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Comment by cylinder | Hacker News Reader

Haha they really are trying to sell every story possible to their investors. I'm going to enjoy this company blowing up.

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Aren't they just throwing a lot of different things at the wall, to see what (which ones) stick? While, yes, I do have a problem with Uber's attitude, and also I'm generally more charmed by doing one thing and doing it right, I can totally see how this as a general approach might make sense (to them). I worked for XPO, then Con-way, and they have/had a business unit (Menlo) doing pretty much this: matching up carriers and shippers, using unused space, or throwing business at vehicles that would otherwise be skipping a turn. From first-hand experience, I can say that that general business could certainly use a shake-up, and that Uber stands to benefit from doing so. (Still, not liking them...)

I'm guessing that your opinion comes from your personal distaste of their practices and aren't based on any business facts or insights. I'd love to hear why you think they are going to "blow up".

You should read Naked Capitalism's excellent 5-part series about Uber's viability:

Part 1: http://www.nakedcapitalism.com/2016/11/can-uber-ever-deliver...

Part 2: http://www.nakedcapitalism.com/2016/12/can-uber-ever-deliver...

Part 3: http://www.nakedcapitalism.com/2016/12/can-uber-ever-deliver...

Part 4: http://www.nakedcapitalism.com/2016/12/can-uber-ever-deliver...

Part 5: http://www.nakedcapitalism.com/2016/12/can-uber-ever-deliver...

They're burning investor money and have no plausible plan to reach profitability. Their best plan appears to literally be that the singularity might come early in the area of personal urban transit.

They could get the benefit of the doubt... but then you see stunts like the recent self-driving fiasco.

> plausible

I find it plausible that they can turn a profit on ride hails, despite it being a competitive market. FedEx, DHL, and UPS are all profitable.

> FedEx, DHL, and UPS are all profitable.

All of whom own or lease almost all of their transportation infrastructure (Note Amazon leased their own Prime planes).

> All of whom own or lease almost all of their transportation infrastructure

Most FedEx drivers are contractors who must supply their own trucks.

Fedex was held liable for mislabelling thousands of employers as contractors when they were not.

"FedEx has settled a long-running dispute with FedEx Ground California drivers. The class settlement will create a $228 million fund to resolve claims by over 2,000 FedEx Ground and FedEx Home Delivery pickup and delivery drivers. Some claims date back to 2000 and some extend through 2007. The settlement must still be approved by the Ninth Circuit, but assuming court approval, will end one chapter in a bitter dispute."

"In this case, the Ninth Circuit said that FedEx controlled the drivers and that they were independent contractors in name only. It was a major blow to FedEx, which has fought about its so-called independent contractor model of operation for many years. The financial benefit of the contract arrangement was big. For years, FedEx has been able to shift to its drivers the costs of FedEx branded trucks, FedEx branded uniforms, FedEx scanners, fuel, maintenance, insurance, and more. Drivers were not provided pay for missed meals, rest periods, overtime compensation, etc."

http://www.forbes.com/sites/robertwood/2015/06/16/fedex-sett...

I didn't realize the drivers won that suit, good for them!

I think their opportunity to turn a profit on ride hails in enough local markets to justify their valuation is limited by [current and future] competitors operating on the same sell VC-subsidised rides at below cost business model. I think the longer they continue to grow revenues and vanity metrics and raise more capital, the more numerous those competitors get...

Yes, but eventually the subsidy will run out and companies will turn a profit or stop operating. Or maybe the investors will never stop the subsidy. That's fine, too.

Sure but will that profit justify their valuation is probably the doubt. Fedex's market cap is $50bn right now.

Valuation is misleading. The later investors likely have enough clauses to protect their capital that they're not thinking of the investment the way a public investor thinks about buying a share. I think you're right that the valuation will become a lower market capitalization if/when they go public.

I actually don't think the self-driving announcement and implementation was a fiasco. Message got out there, media ate it up, and any potential "controversy" only further strengthened their positioning efforts against Google, Tesla and Apple in the self-diving market.

And of course a fantastic branding.

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