71–80 of 141 posts
Sales growth in commodity product that is loosing money on ever sale? I'll never understand this. Uber won't own the market. There is zero lock-in. If Lyft is cheaper this week, I'm riding Lyft. I sold my car over a year ago and use a mix of ridesharing and rentals for transportation. Uber and Lyft's greatest competition in my life is a small Google product where people pick up people on their daily commute to and fr…
Earlier quoted context omitted.
> In the fifth year you think you're gonna spend $6 and make $10. And now you're profitable. In theory yes, but tracking the the progress of UberChina http://www.cnbc.com/2016/02/18/uber-losing-1-billion-a-year-... , situation in Denmark or Spain, inability to win market share from established players in Russia, India or Malaysia introduce some real-world corrections to an otherwise ideal business plan.
Or maybe their market plan already included those potential misses.
> Uber said it uses generally accepted accounting principles. Revenue includes only the portion Uber takes from fares, except in the case of its carpooling service; the company counts the entire amount of an UberPool fare as revenue. Does this mean Uber technically recognizes more revenue from from a $6 UberPool ride than a $20 UberX ride?
That sentence seems like its intention is to confuse the reader. To me it means for UberX: Fare - Cost = Revenue, and for UberPool: Fare = Revenue.
Sales growth in commodity product that is loosing money on ever sale? I'll never understand this. Uber won't own the market. There is zero lock-in. If Lyft is cheaper this week, I'm riding Lyft. I sold my car over a year ago and use a mix of ridesharing and rentals for transportation. Uber and Lyft's greatest competition in my life is a small Google product where people pick up people on their daily commute to and fr…
> There is zero lock-in. If Lyft is cheaper this week, I'm riding Lyft. It makes sense, but I'm not sure it works out that way. Many web services have zero lock-in (not including those with a network effect such as Twitter and Facebook) and competitors are a URL away, yet the first ones to gain (mindshare? marketshare?) seem to keep it: Google search, Amazon, etc.
“We’re fortunate to have a healthy and growing business" $2.8bn "adjusted net loss" on $6.5bn revenue is healthy?
The naivety on HN is staggering sometimes. Imagine your parents give you a $10 loan to start a lemonade stand. You think you need six years to make them an above market return on their investment of 2x. You're gonna buy cups, lemons, sugar, and water. In the first year you think you're going to spend $3 and make $0. So you have $7 in the bank. In the second year you think you're gonna spend $2, and make $1. So you ha…
Imagine your parents give you a 10 dollar loan to start a lemonade stand.
It costs you $3 to buy the lemons, sugar, water, and cups to make 10 cups of lemonade, that you sell for ten cents each.
In the first day you spend $3 and make $1. In the second day you spend 3 more dollars and make one dollar. In the third day you spend $3 and make another $1. In the fourth day you again spend $3 and make $1. At this point you now have $2 remaining.
On the fifth day a miracle happens and your mom gives you another 10 dollars, so you make and sell more lemonade. But you're concerned now so you ask all of your customers why they're buying your lemonade. They tell you that the only reason is the price, it's such cheap lemonade! If it were 2x more expensive they might still buy it, but certainly not at 3x.
And then what happens 4 days later?
Uber doesn't have a business model, they have a house of cards. They can't make money continuing to operate the way they do now, fares don't cover their operating costs, even if you factor out costs of "building" or "expansion". Their paths to success are either forcing everyone out of business by undercutting them and causing everyone else to go bankrupt, after which they can raise their prices back to the old market rates; or, somehow managing to get self-driving taxis on the market in the next 5 years so they can take driver compensation out of the equation.
Earlier quoted context omitted.
The naivety on HN is staggering sometimes. Imagine your parents give you a $10 loan to start a lemonade stand. You think you need six years to make them an above market return on their investment of 2x. You're gonna buy cups, lemons, sugar, and water. In the first year you think you're going to spend $3 and make $0. So you have $7 in the bank. In the second year you think you're gonna spend $2, and make $1. So you ha…
> In the fifth year you think you're gonna spend $6 and make $10. And now you're profitable. In theory yes, but tracking the the progress of UberChina http://www.cnbc.com/2016/02/18/uber-losing-1-billion-a-year-... , situation in Denmark or Spain, inability to win market share from established players in Russia, India or Malaysia introduce some real-world corrections to an otherwise ideal business plan.
Any concrete data on this other than for news articles?
Earlier quoted context omitted.
> I'm 43 and would like to start a family. Don't wait for success or money if you want to start a family, there really never is a 'right' time.
Why does HN limit the depth of replies? Just to keep the page looking snappy & fresh? That's pretty awesome that you guys thought of hosting videos. The idea escaped me, even after watching photo.net & then Flickr. I was working on an idea back then & the issue was the cost of bandwidth, right? Sure.. put videos on the Internet... but how would you ever pay for that much bandwidth? I guess that's why a Silicon valley…
OH.
I felt like I was going insane reading some of the comments that seemed like they had no context. Ha. (Now to figure out what the proper ordering is? Unless it's deleted)
Thanks for the context
> Uber said it uses generally accepted accounting principles. Revenue includes only the portion Uber takes from fares, except in the case of its carpooling service; the company counts the entire amount of an UberPool fare as revenue. Does this mean Uber technically recognizes more revenue from from a $6 UberPool ride than a $20 UberX ride?
Can someone explain how GAAP would consider only Uber's share of an UberX revenue, but the entirety of an UberPool as revenue? This doesn't really make sense to me.
I think this is a matter of accounting judgment.
I'm not an accountant, but I remember reading somewhere that pure agency transactions have different accounting treatment vs. "principal" transactions where the party in question assumes more risk and is not acting strictly as a representative of another party (the UberX driver).
[1] http://www.journalofaccountancy.com/news/2015/aug/fasb-propo...
Sales growth in commodity product that is loosing money on ever sale? I'll never understand this. Uber won't own the market. There is zero lock-in. If Lyft is cheaper this week, I'm riding Lyft. I sold my car over a year ago and use a mix of ridesharing and rentals for transportation. Uber and Lyft's greatest competition in my life is a small Google product where people pick up people on their daily commute to and fr…
> There is zero lock-in. If Lyft is cheaper this week, I'm riding Lyft. It makes sense, but I'm not sure it works out that way. Many web services have zero lock-in (not including those with a network effect such as Twitter and Facebook) and competitors are a URL away, yet the first ones to gain (mindshare? marketshare?) seem to keep it: Google search, Amazon, etc.
Amazon figured out how to marry a familiar and easy to use web-based store to a state of the art fulfillment pipeline, which is how they took over the market. Fulfillment is a non-trivial problem. Keeping track of what is where and how much is left, figuring out what to charge for shipping and handling, and figuring out where to keep stock and how to produce orders. A typical web-based shop will get to your order in one or two business days and be able to put it in the mail maybe that day or a day later. Amazon figured out how to optimize everything about their systems to be able to get your order in the mail within hours of you placing it. They've consistently been improving that process for years, and almost nobody can keep up with them. They can achieve same day delivery on a lot of common items in many metro areas, for example.
If Uber was as superior to the alternatives as Amazon or google was they wouldn't have any problems keeping marketshare. But they really aren't that much different than Lyft or other ride hailing apps. The core valueadd comes from being able to use a smartphone to set up your ride instead of having to place a call or having a cab be immediately visible to you. There's not enough that Uber brings to the table otherwise which would allow them to keep their business if they couldn't subsidize fares using VC money.
Sales growth in commodity product that is loosing money on ever sale? I'll never understand this. Uber won't own the market. There is zero lock-in. If Lyft is cheaper this week, I'm riding Lyft. I sold my car over a year ago and use a mix of ridesharing and rentals for transportation. Uber and Lyft's greatest competition in my life is a small Google product where people pick up people on their daily commute to and fr…
Is there any public information that says Uber is losing money on every sale? I'm honestly curious. In my brief searching, I haven't found much. I'd love it if someone would point me to information on Uber's finances/economics that shows their negative gross margin in developed city markets.
My mental model of their finances is heavy fixed costs (~5,000 programmers) and near-zero marginal costs. The only way they are losing money on marginal rides is if they are paying drivers more than the fare. Do they? I honestly don't know.