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Uber Sets Valuation Record of $17B in New Funding

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Re: Uber Sets Valuation Record of $17B in New Funding

#91

Post by ghaff »

milesskorpen wrote: post #55
muhfuhkuh wrote: post #30

Earlier quoted context omitted.

>I imagine a world where you can get anything on demand in minutes, and in that scenario Uber is the taxi, UPS, FedEx, etc. at the same time. And, with that, the feeling that Amazon.com will snap this company up for cash and stock is almost palpable. Forget drones, that's PR stuff for now. Uber is the real PTTH (product to the home) service.

Given that Google has a huge stake in Uber, I think an Amazon acquisition is unlikely. I see Uber as Google's go-to-market plan for driverless cars (along with the trucking industry) ... if they can pull that off, something like this valuation is justified.

>Google's go-to-market plan for driverless cars

Robo-Uber as I like to call it is all very exciting and transformative. And I have little doubt that it will happen someday. But we're talking decades according to many people who really know the topic. For example, John Leonard who was on the MIT DARPA Challenge team has said "I don’t expect to have truly driverless taxis in Manhattan in my lifetime." http://digitalcommunity.mit.edu/community/featured_content/b...

Next time you drive in a city, think about all the little decisions that you're making constantly. I'd love to have a service like this but it's not going to happen within a time horizon relevant to any current financial investments.

Re: Uber Sets Valuation Record of $17B in New Funding

#92

Post by [deleted] »

6cxs2hd6 wrote: post #38

Although I like using Uber as a customer: > "Uber is creating 20,000 jobs per month, the company said in a blog post." Really? "Jobs" as in W-2 forms and health benefits? Or independent contractors? Not that the latter are necessarily bad, but they're fundamentally different. It is misleading to call them "jobs" in their blog headline, then switch to "partners" and "small business entrepreneurs" in the text.[1] I und…

[deleted]

Re: Uber Sets Valuation Record of $17B in New Funding

#93

Post by rayiner »

opendais wrote: post #77
rayiner wrote: post #59

Earlier quoted context omitted.

They might be turning around that NJ loss: http://www.engadget.com/2014/06/06/tesla-resume-sales-new-je... , which puts them at 4 for 4. They're in it for the long game, and I don't see them losing it.

Do you honestly think Uber can do that while simultaneously removing per-trip, tax medallions, and other taxi related revenues from the city coffers?

I don't think cities have to lose taxi-related revenues for Uber to be able to do business. They will have to figure out how to address concerns about liability insurance, overcrowding, etc. But they can still do that and make money.

Re: Uber Sets Valuation Record of $17B in New Funding

#94

Post by ChuckMcM »

conistonwater wrote: post #61
ChuckMcM wrote: post #45

This is an interesting valuation[1]. It shows that a workable replacement for an established service business (one suffering from large regulatory capture) is considered so significant from the perspective of these bankers. It also suggests that AirBnB could do really well if they went back to the well (not that I recommend it, money drags you down). But more importantly this looks like an investment in a public comp…

You are being very optimistic. For example, as the article says: > Kalanick added that Uber would continue to experiment “aggressively” with lowering prices, in an attempt to boost demand and increase the number of trips drivers can make each hour. Valuing the company at 80 times the 2013 revenues ( http://techcrunch.com/2013/12/04/leaked-uber-numbers-which-w... ) is a little bit mad. > I also agree the bubble hyster…

I don't disagree that the valuation stretches credulity, perhaps past the breaking point. The narrative of the 'old bubble' was hyperinvestment by retail investors and mutual funds in unsustainable technology visions. The only thing 'wrong' about that old bubble, was that people who didn't know any better lost their money. Sometimes because their cousin or grandchild said they should put their savings bonds into tech stocks, sometimes because an aggressive fund manager put in more risk than they bargained for. Either way, people who didn't know better got hurt. In this hypervaluation the people at risk are investment bankers that do know better, and if they lose all their money, then fine. That was the bet they made. To use a gambling colloquialism, "Nobody cries for the roulette player that puts it all on 13 black."

I don't necessarily agree that markets "exist" to allocate capital efficiently, I would agree they exist so that capital can be allocated. When the market is fair, capital is pretty efficient allocated, but the private financing market is not fair on at least two axes, there are artificially high barriers to creating new goods (startups in this case), and information is not evenly distributed amongst all parties. That does put a crimp on the efficiency of their operation.

Re: Uber Sets Valuation Record of $17B in New Funding

#95

Post by arjunnarayan »

uptown wrote: post #86
untog wrote: post #60

Earlier quoted context omitted.

Yes, Uber is cheaper - until it isn't, when it implements surge pricing. It's a very different model, which makes direct comparisons tricky. The price of a London cab is regulated. Maybe that price is wrong. Uber can take advantage of it, but do you think the London taxi industry is really going to sit back and watch its market disappear without even trying to change price? And the cab driver protests are more rooted…

"Yes, Uber is cheaper - until it isn't" Case in point: https://twitter.com/newyorkcityliz/status/470010209403150336 Edit: Fixed my idiom. Thanks dragonwriter.

Friday night, 9pm.

Re: Uber Sets Valuation Record of $17B in New Funding

#96

Post by rxaxm »

gtirloni wrote: post #87

From Uber website: "Get a ride that matches your style and budget" In the low budget/style area, they are competing with the public transportation system? Do they have all this financial/momentum muscle? And in the high budget/style, they are competing with rich people who can own their own BMW/Ferrari with a private driver? Who "needs a ride" and chooses an expensive "SUV". How could this thing make a difference in…

there are a lot of rich people without cars (a lot of manhattan). i know tons of people who hate cabs and can't really justify a full-time driver--these people take a lot of ubers. also, cabs can only take 4 people at a time. the ability to call a large car when going out has a made a huge difference.

Re: Uber Sets Valuation Record of $17B in New Funding

#97

Post by efuquen »

aneisf wrote: post #18
quaunaut wrote: post #10

Prepending Edit: If you're reading this and have a lot more familiarity in how investments of this kind are made, and what kinds of things these investors are thinking, I really am making this post looking for education. I didn't finish college, and don't know a lot, but I'm trying. If you'd rather not stir the pot by talking here, my e-mail is in my profile. The one thing that makes me skeptical about this, is histo…

I think UberX has the potential to become bigger than the taxi market. In the vast majority of American cities, especially in smaller ones, taxis are not readily available and are just too expensive for getting across a suburban sprawl. The main Uber service depends on the existing market to some extent but I think it also has the potential to grow it.

> In the vast majority of American cities, especially in smaller ones, taxis are not readily available and are just too expensive for getting across a suburban sprawl.

There is a good reason for that, it's so much easier to own a car in these and is pretty much mandatory to get anything done. Cars + Gas are still relatively cheap in comparison to paying someone to come out and drive you around anytime you need to go somewhere, which is compounded in the suburbs by the distance and time involved and the area any taxi service would need to cover.

Sure, technology ala Uber helps here, but does this really change the fundamentals in theses areas? I don't think so, you still need to pay a driver and in areas where its easy and cheap to store a car it would make much more financial sense to just drive yourself around.

Driverless cars are really the fundamental shift that might change this, but let's be real that is still a risky venture, despite all the Google hype people are drooling over. This large of an evaluation only makes sense with that in mind.

Re: Uber Sets Valuation Record of $17B in New Funding

#98

Post by _delirium »

conistonwater wrote: post #54
6cxs2hd6 wrote: post #38

Although I like using Uber as a customer: > "Uber is creating 20,000 jobs per month, the company said in a blog post." Really? "Jobs" as in W-2 forms and health benefits? Or independent contractors? Not that the latter are necessarily bad, but they're fundamentally different. It is misleading to call them "jobs" in their blog headline, then switch to "partners" and "small business entrepreneurs" in the text.[1] I und…

The whole "creating jobs" narrative is a bit odd. It's not like the people working for Uber would have just sat on their hands otherwise. They would have found something else to do.

Some of them would've even been doing a pretty similar thing. To the extent that part of Uber's growth is through taking market share from competitors in the car-driving-for-money sector, they're shifting jobs between companies, not creating new ones. Some may also come from expanding the size of the whole market, but you can't just count the total number of employees and use that number as the net-jobs-created.

Re: Uber Sets Valuation Record of $17B in New Funding

#99

Post by opendais »

rayiner wrote: post #93
opendais wrote: post #77

Earlier quoted context omitted.

Do you honestly think Uber can do that while simultaneously removing per-trip, tax medallions, and other taxi related revenues from the city coffers?

I don't think cities have to lose taxi-related revenues for Uber to be able to do business. They will have to figure out how to address concerns about liability insurance, overcrowding, etc. But they can still do that and make money.

Fair enough, but that is part of why they are getting banned and upsetting people. Its also part of their price competitiveness. Their contractors haven't been paying.

Re: Uber Sets Valuation Record of $17B in New Funding

#100

Post by tptacek »

rayiner wrote: post #59
opendais wrote: post #46

Earlier quoted context omitted.

Tesla is larger and how well has that worked for them? http://www.valuewalk.com/2014/03/tesla-motors-inc-tsla-now-b... Uber, unlike Tesla, is costing the government money in the form of licensing fees. Its contractors are not paying for such licenses frequently. You can't simply "fight" the tax system like that. Can they fight lobbying by the taxi companies? Yes. Can they convince the governments to go tax someone el…

They might be turning around that NJ loss: http://www.engadget.com/2014/06/06/tesla-resume-sales-new-je... , which puts them at 4 for 4. They're in it for the long game, and I don't see them losing it.

To be fair, Tesla has a much stronger case. The regs impeding Tesla make no public policy sense, and the perceived public benefit of Tesla is enormous on its face.
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