Leaked Lyft Document Reveals a Costly Battle with Uber • Hacker News Board

Re: Leaked Lyft Document Reveals a Costly Battle with Uber

#41

Post by minthd » Thu, Apr 30, 2015, 11:28 PM UTC

toomuchtodo wrote: post #7

gphil wrote: post #5

What I want to know is, when the VC money runs out, what's the barrier to entry to this business? Right now, Uber can beat everybody on price and quality because they don't have to be profitable for a long time. But once they have to compete on price, where's their advantage? Installed user-base? Incumbents forced out of business? Many times I call for an Uber and a cab comes first and then they lose my business to t…

There is no barrier to entry. Seriously. Mobile apps? Backend infrastructure? Trivial. I take that back; the biggest barrier to entry might be a massive trove of ride data for machine learning used to predict capacity requirements. In large metro areas, you might be able to get this data in an open format, obviating the need for you to gather the data yourself (the recently FOILd New York Cab Ride data comes to mind…

Sure there are risks. But assuming that lyft-line or uber-pool succeed in filing rides with few people in return for lower costs they will have an advantage, because average occupancy and a reasonable ride length is highly dependent on amount/density of users.

And BTW, according to some uncofirmed twit[1], more than 50% of lyft rides in sf are done through lyft-line, which is a pretty new service.

To a lesser extent, user density is also related(in theory) to driver ride time, both in reducing wait time, and reducing time from call to passenger.

Also there might be a possibility they can subtly incentivize drivers to only drive for them by giving complying drivers a bit more work, or better work.

And as for your risks lists,you can paraphrase it as: the hand of god(government), a darpa scale technology(self driving cars), very well resourced competitor.

But every company is under risk from the first 2, even for businesses with a strong competitive advantage.

[1]https://twitter.com/DavidELPC/status/593832295968059392

Re: Leaked Lyft Document Reveals a Costly Battle with Uber

#42

Post by jonas21 » Fri, May 01, 2015, 12:38 AM UTC

russell_h wrote: post #24

HockeyPlayer wrote: post #3

Earlier quoted context omitted.

They took the $10.8m in December 2013 revenue and multiplied by 12 to get the $130m number.

But that doesn't make sense, why would they use a year old run rate instead of actual revenue numbers? This presentation was seemingly somewhat recent. Also did Lyft Line even exist in 2013?

Yeah, I think they used the December 2014 numbers.

Re: Leaked Lyft Document Reveals a Costly Battle with Uber

#43

Post by revelation » Fri, May 01, 2015, 1:23 AM UTC

simonw wrote: post #27

revelation wrote: post #19

Earlier quoted context omitted.

Wow. Leave it to a startup to go into the red whilst providing 1) an app and 2) fluff mustaches and .. well not much more, really.

They're in a flat out race to gain market share with Uber. If they were profitable (rather than reinvesting revenue in further growth) their investors would rightfully be furious.

They are a middleman. Where exactly is the finish line of this particular race? Because it sounds very much like an antitrust lawsuit.

Re: Leaked Lyft Document Reveals a Costly Battle with Uber

#44

Post by eli » Fri, May 01, 2015, 2:43 AM UTC

toomuchtodo wrote: post #23

eli wrote: post #22

Earlier quoted context omitted.

I disagree. The network is the product, not the mobile app. Drivers won't switch to a new app that has no customers and customers won't want an app with no drivers.

Oh puh-lease! We hear this argument time and again, yet continue to hear anecdotes about drivers who drive for both Lyft and Uber. There is zero friction to install a new app and accept fares via that app, except perhaps how many ridesharing apps you can run at once on your device for accepting passengers.

Sure, I also hear anecdotes about companies that try really hard but are unable to compete with Craigslist or eBay or other big companies with a strong two-sided network effect.

Based on what I've seen, Hailo tried to buy their way into this market, albeit with the twist of using licensed cabs. Seems like they had little trouble signing up drivers (who were predisposed to distrust the UberTAXI) but my assumption is that they gave up in North America because they couldn't afford to keep giving away the free rides and discounts needed to build up a customer base.

Re: Leaked Lyft Document Reveals a Costly Battle with Uber

#45

Post by digitalzombie » Fri, May 01, 2015, 3:12 AM UTC

gphil wrote: post #5

What I want to know is, when the VC money runs out, what's the barrier to entry to this business? Right now, Uber can beat everybody on price and quality because they don't have to be profitable for a long time. But once they have to compete on price, where's their advantage? Installed user-base? Incumbents forced out of business? Many times I call for an Uber and a cab comes first and then they lose my business to t…

Probably pivot or add another service that compliment its existing one.

I've heard they're beta testing package delivering over at reddit iirc.

An example would be Netflix, they had cheap license for old tv shows and dvd rentals. Now that production studios have squeezing Netflix in licensing deal with higher prices, they've pivot to becoming HBO like, with a smaller selection of tv shows and movies license.

Re: Leaked Lyft Document Reveals a Costly Battle with Uber

#46

Post by prostoalex » Fri, May 01, 2015, 4:04 AM UTC

dankohn1 wrote: post #13

gphil wrote: post #5

What I want to know is, when the VC money runs out, what's the barrier to entry to this business? Right now, Uber can beat everybody on price and quality because they don't have to be profitable for a long time. But once they have to compete on price, where's their advantage? Installed user-base? Incumbents forced out of business? Many times I call for an Uber and a cab comes first and then they lose my business to t…

Uber is a classic two-sided network [0], like eBay or Craigslist. It is extremely difficult to displace a first-mover advantage. The hundreds of thousands of drivers are set up with Uber and will stick with it unless something new is meaningfully better (and Lyft is currently worse). Same with the users. I think you can be legitimately critical of Uber's poor business ethics [1], but the sustainability of their curre…

You just carve out a niche.

* Blacklane - cheaper than Uber Black, but the rides have to be pre-arranged (essentially a car service with UI)

* Wingz - cheaper than UberX, but only to/from airports

* Sidecar - cheaper than UberX, but with implied wait of up to an hour

* Leap buses - cheaper than UberX, but with set routes

If drivers are utilized at 100%, they will have very little reason to look around. But most of the services don't utilize (and hence don't pay) drivers for 100% of their time. Hence a myriad of phones with a bunch of identical apps on drivers' dashboards, and frantic search for 100% utilization (food delivery? shopping delivery? help with moving?) among the dispatcher services.