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Instacart is playing games with its workers’ pay

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Re: Instacart is playing games with its workers’ pay

#131

Post by muzz »

l33r wrote: post #56
tyre wrote: post #8

They have tens of thousands of customers, yet are worth multiple billions of dollars (valued at $2bn in 2015.) That's just incredible. Let's say they have 100k customers who each use the service every week. That's 5.2m orders per year. Let's say $100 per order, to be generous. At a 10% service fee, that's $50m for a two-year-old 40x revenue multiple. Before paying their contracted workforce. This does not make sense.…

I use Instacart because I don't own a car and convenience. When I'm making $60 an hour overtime during the weekend for a 12-14 hour shift, you bet I'm going to be using Instacart for a nominal 10% markup for groceries from Costco.

And you don't need to be a member of Costco to use it via Instacart

Re: Instacart is playing games with its workers’ pay

#132

Post by MaxGabriel »

marcell wrote: post #117
MaxGabriel wrote: post #24

I think Instacart's other justification for this is that multiple people are now involved in procuring your groceries. One person shops and another delivers. If you tip in cash, the shopper gets nothing. Can't speak to if this is their real motive, but does seem to be in line with other criticisms of tipping (e.g. waitresses making much more than kitchen staff).

This is a misdirection and Instacart knows it. In the old system, the shopper got half the tip. Source: I worked as an Instacart driver for fun.

Ah, sad to hear that

Re: Instacart is playing games with its workers’ pay

#133

Post by thehardsphere »

MegaButts wrote: post #121
thehardsphere wrote: post #116

Earlier quoted context omitted.

Right, so the question becomes "Why do enough people perceive the potential of Instacart to be billions when a back of the envelope calculation by a guy on Hacker News suggests that's not the case?" Presumably said investment bankers are capable of doing the same math as Hacker News readers, so why did they still fork the money over when they have many other crazy bets to choose from?

Here's a secret: most investors lose money.

Well, sure. They usually know they're going to lose money going in, and they can pick all sorts of things to lose their money on. That doesn't explain why the picked this one particular thing to lose money on.

Re: Instacart is playing games with its workers’ pay

#134

Post by muzz »

misingnoglic wrote: post #120
closeparen wrote: post #101

Earlier quoted context omitted.

>What is the market for +10% on groceries and basic necessities? People who live in the suburbs without cars. Cities are successfully discouraging car ownership by making parking scarce near downtown offices and even the suburban transit stations that lead to downtown offices. At the same time, cities aren't permitting the construction of dense, walkable neighborhoods, at least not fast enough to make them affordable…

It's also very useful for college students with no cars, that live in off campus apartments with 3-4 people (can split delivery fees, tip, etc).

Very useful for lots of people-- busy parents, office deliveries, people who would just rather pay 10% and save the time, etc.

Re: Instacart is playing games with its workers’ pay

#135

Post by muzz »

CamelCaseName wrote: post #62
grandalf wrote: post #29

Earlier quoted context omitted.

Say the average wage is $10/hour. If it takes one hour to go and do that shopping, I break even by paying someone else that $10, if I value my leisure time as equivalent to my wage. More likely, most Instacart customers earn much more than $10/hour. For someone with a busy work schedule, there might be 2 hours of leisure time available per day during the week. This means that by using Instacart I increase my after-wo…

When I go to a physical store I frequently end up buying things I didn't really intend to, but with Instacart, I only end up with the things I actually wanted. Specifically what products do you end up buying? I have always wanted some insight as to who buys these items near the register and why, as I rarely see anyone pick them up.

Gum and mints, for me. Sometimes batteries if I need them, even though they are cheaper at WalMart or Target.

I don't personally buy things like tabloid magazines, but I'm sure grocery stores have spent lots of time researching this to optimize the placement of these products

Re: Instacart is playing games with its workers’ pay

#136

Post by toomuchtodo »

doctorpangloss wrote: post #54
pshposh wrote: post #42

Earlier quoted context omitted.

I didn't realize your comment exclusively pertained to venture owners. Even so a venture owner could sell the company to the employees and move on to their next big thing.

You're right that it's something a venture owner could do. But then, you'd be surprised at how many highly-compensated programmers never bother to exercise their options. The same ones who then go on Hacker News and complain about bad treatment of workers, and how if only they owned the companies.

I not only complain about how workers are treated, I'm also active in the political process to effect social change for workers. I've also exercised all of the options I've vested at the startup where I'm employed.

Careful with them broad strokes Tex.

Re: Instacart is playing games with its workers’ pay

#137

Post by grandalf »

jjfine wrote: post #71
CamelCaseName wrote: post #62

Earlier quoted context omitted.

When I go to a physical store I frequently end up buying things I didn't really intend to, but with Instacart, I only end up with the things I actually wanted. Specifically what products do you end up buying? I have always wanted some insight as to who buys these items near the register and why, as I rarely see anyone pick them up.

They're not necessarily talking about just those items. The entire store is designed so you buy things you weren't intending to buy. You never said/thought: "Ooh look ice cream's on sale..." and failed to resist?

Exactly, I rarely add anything from the checkout lane area, but I'm often enticed to buy unplanned stuff from the ethnic foods aisle, and now and then I'm taken in by the end-cap displays featuring product pairings, especially if I've been inclined to try a similar combination.

Re: Instacart is playing games with its workers’ pay

#138

Post by solatic »

tyre wrote: post #8

They have tens of thousands of customers, yet are worth multiple billions of dollars (valued at $2bn in 2015.) That's just incredible. Let's say they have 100k customers who each use the service every week. That's 5.2m orders per year. Let's say $100 per order, to be generous. At a 10% service fee, that's $50m for a two-year-old 40x revenue multiple. Before paying their contracted workforce. This does not make sense.…

It makes sense when you take into consideration investors' expectation for exponential growth. The company's valuation is based on that expectation. If the company stops growing, expect the valuation to pop like a bubble.

Re: Instacart is playing games with its workers’ pay

#139

Post by notatoad »

biot wrote: post #13
tyre wrote: post #8

They have tens of thousands of customers, yet are worth multiple billions of dollars (valued at $2bn in 2015.) That's just incredible. Let's say they have 100k customers who each use the service every week. That's 5.2m orders per year. Let's say $100 per order, to be generous. At a 10% service fee, that's $50m for a two-year-old 40x revenue multiple. Before paying their contracted workforce. This does not make sense.…

It's basically Webvan 3.0. https://en.wikipedia.org/wiki/Webvan

Or ViaWeb 2.0

Re: Instacart is playing games with its workers’ pay

#140

Post by muzz »

narsil wrote: post #43

As a sidenote, returning something bought via Instacart is a pain, as I learned. Target refused to accept a defective light-bulb without the original receipt, but did exchange it for store credit fortunately.

You were able to buy a light bulb on Instacart?

I'm in Silicon Valley and it's just groceries here

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