Lyft losing as much as $50M a month, president confirms • Hacker News Board

Re: Lyft losing as much as $50M a month, president confirms

#91

Post by cloudjacker » Wed, Jul 13, 2016, 1:58 PM UTC

liquidise wrote: post #7

What shocks me about both Lyft and Uber's enormous burn rates are that they suggest the companies are heavily subsidizing their drivers. This subsidy is in part to spur penetration in new markets (as all marketplace apps must do), but also suggests that they have reason to believe customers will simply not pay a rate that makes the business profitable. Assuming the latter is the case, i'm not sure if they have reason…

Lots of valid rational replies here but yes lyft, uber and the crowd can be wrong financially.

Re: Lyft losing as much as $50M a month, president confirms

#92

Post by TheCoelacanth » Wed, Jul 13, 2016, 2:09 PM UTC

liquidise wrote: post #7

What shocks me about both Lyft and Uber's enormous burn rates are that they suggest the companies are heavily subsidizing their drivers. This subsidy is in part to spur penetration in new markets (as all marketplace apps must do), but also suggests that they have reason to believe customers will simply not pay a rate that makes the business profitable. Assuming the latter is the case, i'm not sure if they have reason…

They do at least claim to be profitable in the US[0]. So if that is to be believed, a good portion of customers are willing to pay a sustainable rate. Whether the same applies in the other markets where they are heavily subsidizing drivers remains to be seen.

[0] http://fortune.com/2016/02/18/uber-profitable-us/

Re: Lyft losing as much as $50M a month, president confirms

#93

Post by mikeash » Wed, Jul 13, 2016, 2:16 PM UTC

msandford wrote: post #87

mikeash wrote: post #76

Earlier quoted context omitted.

Actual airplane "autopilots" can be something as simple as automatic wing leveling or altitude hold. Using that name for Tesla's technology is only inaccurate in that they don't make airplanes. Where did everybody get the idea that "autopilot" implies full autonomy?

Sure, let's torture language for Tesla's benefit! Why not? I mean, we shouldn't let a silly thing like people's lives get in the way. Since you know about historical autopilots I suspect this will be redundant, but here it is anyhow: https://en.wikipedia.org/wiki/Autopilot#Modern_autopilots "Modern" autopilots have been around for a while, something like 40-50 years. Sure if you go back 80 years you can find autopilo…

What part of that article do you think is a point against what I'm saying, exactly? Autoland and taxiing? That requires a Category III airport which many airports, even those served by airliners, aren't. It also requires pilot supervision and pilot intervention in the event of emergency. Hardly autonomous!

And there are plenty of systems below that. For example:

http://sarasotaavionics.com/category/autopilots/certified-au...

Note: single axis and 2-axis. Just like what I said it can be.

But yes, the people insisting that "autopilot" does not imply autonomy, simply because no autonomous autopilot exists on any commercial aircraft, are torturing the language. Sure.

Re: Lyft losing as much as $50M a month, president confirms

#94

Post by mikeash » Wed, Jul 13, 2016, 2:17 PM UTC

treebeard901 wrote: post #84

mikeash wrote: post #76

Earlier quoted context omitted.

Actual airplane "autopilots" can be something as simple as automatic wing leveling or altitude hold. Using that name for Tesla's technology is only inaccurate in that they don't make airplanes. Where did everybody get the idea that "autopilot" implies full autonomy?

For most people the word autopilot historically has meant full autonomy.

OK, but why? Such a thing has never existed on any production crewed aircraft.

Re: Lyft losing as much as $50M a month, president confirms

#95

Post by mikeash » Wed, Jul 13, 2016, 2:30 PM UTC

WordyMcWordface wrote: post #83

mikeash wrote: post #76

Earlier quoted context omitted.

Actual airplane "autopilots" can be something as simple as automatic wing leveling or altitude hold. Using that name for Tesla's technology is only inaccurate in that they don't make airplanes. Where did everybody get the idea that "autopilot" implies full autonomy?

I expect an inflatable driver to appear and take the wheel, requiring only an occasional top up of air to keep things on the level.

I actually wonder if Airplane! is where people got the idea that "autopilot" means "the plane entirely flies itself." The bit where it's an inflatable doll is obviously satire, but maybe people thought the capabilities were real and the satire was just the doll part?

Re: Lyft losing as much as $50M a month, president confirms

#96

Post by stormbrew » Wed, Jul 13, 2016, 3:10 PM UTC

ForHackernews wrote: post #38

stormbrew wrote: post #10

Earlier quoted context omitted.

I think the play is more or less to strangle the higher priced and over-regulated patchwork taxi industries and build a more uniform national/international regulatory framework that's more amenable to these kinds of businesses. At that point prices will probably rise, and (they hope, and I think they're right) customers will see value in the better product that keeps them in.

> customers will see value in the better product that keeps them in. How is Uber a "better product" than a taxi? As far as I can tell, it's competing on price, and that's it. If cabs were the same price as Uber, I would take a taxi every time.

There are a handful of cities in north America where this might be true. If you live in one of those, congratulations. For the rest of us the difference is night and day.

As a really simple example, as applies to my city, I have had to wait 2 hours for a taxi more than once. I've never waited more than 25 minutes for an uber. Average times are ballpark 10 minutes vs. 30 minutes.

I would take uber if it were more expensive than taxis any day.

Re: Lyft losing as much as $50M a month, president confirms

#97

Post by stormbrew » Wed, Jul 13, 2016, 4:29 PM UTC

_Codemonkeyism wrote: post #29

argonaut wrote: post #24

Earlier quoted context omitted.

In the abstract, breaking up monopolies is the canonical example.

Breaking up monopolies raises prices? You've lost me :-)

I think the GP is talking about breaking up 'natural' monopolies, rather than government monopolies.

Note: Just to skip a potential semantic argument that always crops up around this: whether or not you believe it's appropriate to call it a monopoly if it's not enforced by government fiat is beside the point.

Re: Lyft losing as much as $50M a month, president confirms

#98

Post by forgetsusername » Wed, Jul 13, 2016, 4:33 PM UTC

adventured wrote: post #66

forgetsusername wrote: post #62

Earlier quoted context omitted.

> I pay extra to get my groceries delivered because it saves me time. That vast majority of Americans do everything they can to save a few bucks, even when it's an inefficient use of resources (time and money). I'm not sure "nickel and diming" a few wealthy people for home delivery is a $60BB business. There's not a huge barrier to entry and margins are low. But what do I know.

> I'm not sure "nickel and diming" a few wealthy people for home delivery is a $60BB business A few? With between 11 and 13 million millionaires in the US, it's a $60 billion business. And that's ignoring the vast number of people in the US earning $150,000+ in a household while not being millionaires; people that can easily afford such services. And then there's this: "The Richest Generation in U.S. History Just Kee…

>With between 11 and 13 million millionaires in the US, it's a $60 billion business.

What are you basing that on, without knowing any financial information? If the mere existence of millionaires makes a massive company viable, then what company isn't?

Do you believe that the very wealthy, today, are doing these things themselves, and that an Uber courier is solving a huge problem for them? Paying people to deliver stuff isn't new. Neither is driving people around. What Uber has done is made in convenient and, thus far, inexpensive. Do you think Uber will reap massive margins here? The barrier to entry is very low.

Re: Lyft losing as much as $50M a month, president confirms

#99

Post by salemh » Wed, Jul 13, 2016, 4:35 PM UTC

jamesroseman wrote: post #89

sfifs wrote: post #71

Earlier quoted context omitted.

In most economies, it's only the top 5-10% that really can afford to value time over cash. The rest are happy to trade off their time and effort to conserve cash. That's a market for sure - but really not such a big market.

I think you might be underestimating the size of the "on-demand industry"[1]. I'm hardly in the top 5-10% and I tried out Drizly in place of my beer run on Friday night and paid a $5 premium for my 6 pack to be delivered. I valued my time in the moment more than $5 and told myself it was a once in a while thing. I'm sure on-demand groceries, dry cleaning, etc all just hope for that market of people who tell themselve…

That entire article only speaks to investment of the on-demand industry, and its "potential". Citing "uberfication" of services and a "rise of 1099 contractors" means nothing for who will actually pay for the services.

Re: Lyft losing as much as $50M a month, president confirms

#100

Post by georgeecollins » Wed, Jul 13, 2016, 4:37 PM UTC

graeham wrote: post #59

liquidise wrote: post #7

What shocks me about both Lyft and Uber's enormous burn rates are that they suggest the companies are heavily subsidizing their drivers. This subsidy is in part to spur penetration in new markets (as all marketplace apps must do), but also suggests that they have reason to believe customers will simply not pay a rate that makes the business profitable. Assuming the latter is the case, i'm not sure if they have reason…

Reminds me a bit of Groupon etc - its easy to get revenue when you're selling dimes for dollars. Fixed costs are presumably low, so it can't be scale that would lead to profitability. Utilisation rates? I've not heard a lot on if rates could come down to compensate for more passenger-miles. But of course a fair bit of the cost must be tied to passenger-miles. Intentional avoidance of profit by acquiring or R&D? I sup…

Exactly - saying it is profitable in the US, minus interest and stock, is another way of saying it is not profitable just cash flow neutral in some markets. Like Groupon it is a business for sure, and probably a big one. But it may be overvalued. And there is this assumption that when self driving cars come they will not be disrupted. But why not?