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Comment by elmar | Hacker News Reader

I am shocked, how is possible to get away with this toxic company culture.

Because they're "high performers".

Screw Uber. Just delete that app and never use it.

I'd like the think that eventually karma will catch up with Uber. Hard to think of a single positive thing to say about the company.

Here's my positive thing. Taking a cab to the airport from my house in Cambridge, MA runs about $42 before tip, so call it $48 or so.

An UberX costs $24.30 right now and UberPool costs $14.30 right now. Additionally, I can summon the ride more easily and get better feedback about the arrival time, giving me more confidence/less anxiety that I'll have a problem getting to the airport on time.

As a consumer, by reducing my cost by 50-70% while providing a marginally better service, I can readily find one thing positive to say about the company.

You could say the same about lyft, seemingly minus the illegal and immoral behavior, though they might get away with the same behavior due to not being in the spotlight as much as Uber

Sure. Being able to say a positive thing about Jane does not diminish the positive thing that I say about Susan.

Wait until no one else is in the market. Then have fun with your positive thing/thinking :)

I don't see that happening. There's no natural monopoly here and almost no barriers to entry. The moment Uber tries to leverage being the only one left, someone new will undercut them.

There will be a natural monopoly (or rather, a natural oligopoly) once the car makers all have their own autonomous carsharing fleets and sell cars only with an EULA that forbids ridesharing. The entry barrier for car manufacturing is way higher.

Ok, but a lot of companies are working on self driving cars.

If one company refuses to sell self driving cars to consumers/upstart ride sharing companies, then that means that ANOTHER self driving car company can makes 10s of billions of dollars by ignoring this rule.

Do you really think that not a single one of the multitude of self driving car companies would break the collusion agreement, if there is 10s of billions of dollars on the line?

>sell cars only with an EULA that forbids ridesharing.

It'd probably be leases, rather than sales - selling property gives the buyer more rights, which would make that sort of EULA problematic. Might be able to side-step it by a combination of forbidding commercial ride-sharing in order to keep the self-driving system up to date along with requiring up-to-date self-driving software to be road-legal.

i think you are right about the barriers to entry, but uber will have tremendous resources to kill/acquire any upstart. any prospective competitor is going to have to be very well-financed to deal with uber's ability to price them out of the market.

This is basically like saying "I don't see why someone couldn't just build a Youtube alternative. There's no barrier to entry, basically. You can just buy as many hard drives as you need if Youtube acts up!"

Except the twenty gazillion dollars you need to get started anyway, and the fifty ga-jillion dollar incumbent you're stacked against who already, again, has leveraged their death grip on the market -- which is presumably why you were becoming a competitor at all, right? To fight that?

Why would you need twenty gazillion dollars? It's a business you can enter with a cell phone, a car, and a license. If you really want a smartphone app, you're looking at maybe six figures to build it and some pennies per active user per month to keep it running.

The comparison with YouTube doesn't work, because videos are not fungible. If there's a video you want to see, and that video is on YouTube, your choice is to use YouTube or not see it. If there's a place you want to go, you can use any transportation service that covers the area.

I'm having trouble thinking of a good comparison, because there aren't many markets that are this easy to enter. Maybe house cleaning would fit. If Homejoy had taken off, would there be any fear of it abusing a monopoly position, when anyone can trivially enter the market and compete on their level?

Uber can afford to subsidize your ride for the next 10 years or so. That doesn't mean it's long term viable, it just means that they're pumping money from one pot to another until the first one is empty and won't be refilled.

They've raised over $10B...

I'm willing to take a discount on cabs for ten years. That it's not sustainable does not make it not a net positive to me. (I don't think any of my money is in that $10BB they raised.)

That line of thinking seems to miss a lot of the negative externalities [0] of a hypothetical world in which Uber is dominant.

Just to take one example, Uber doesn't pay the same taxes as taxi companies. Localities will be losing out collectively on a lot of revenue. Aren't you affected if your city has to raise taxes to compensate?

[0]: https://en.wikipedia.org/wiki/Externality#Negative

I am overwhelmingly likely to save more on car services in the next 10 years than I am to pay in increased local taxes, leaving Uber/Lyft a net economic positive for me, even after considering that most of my Uber rides are expense-able to my company.

Uber is proving that car service is not a natural monopoly. If the dominant provider is taking too many liberties with pricing, someone else will come in to right the market.

I didn't intend to start a massive defense of Uber subthread, but to say there's no single thing positive about Uber I thought was a substantial overstatement.

> Uber is proving that car service is not a natural monopoly. If the dominant provider is taking too many liberties with pricing, someone else will come in to right the market.

This is complete nonsense. Car services have never been a monopoly, natural or otherwise; in every major city there have always been multiple car services. Uber's valuation is premised almost completely on the hope/expectation that they can become a monopoly and start exploiting their market position to the detriment of everyone.

Seriously, check out the Naked Capitalism series linked above. It lays out in great detail why Uber is not in any way an example of someone "coming in to right the market". They're wronging the market.

?? I said they're not a monopoly and you seem to violently argue against my text saying that they're not a monopoly. You've convinced me: I agree that they're not a monopoly.

Uber is losing money, believing they can make it up later somehow (presumably self-driving cars, possibly by taking a cut of a substantial percentage of the car service rides).

That's participating in the market, not wronging it, IMO.

No, they believe they can be a monopoly. There's no other way they can be profitable.

So.... You agree that the taxi market is NOT a monopoly?

As soon as Uber tries to become a monopoly, and raise prices, then Taxi cabs can start right back up again, and take back the market with lower prices.

Or ANOTHER VC company can come in, and subsidize prices, and knock Uber out.

As soon as Uber attempts to exploit the market, they are dead.

If the city is smart, they'll fill that hole by taxing Uber and other such services. If they're stupid then there's no end to the ways they can cause me to suffer.

They may not be able to. Many cities are subject to state laws about what can and cannot be taxed.

That 50-70% is a loss leader for Uber. Did you read the post of their financials? They are hemorrhaging money.

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

Uber's biggest investor is Saudi Arabia's Sovereign Wealth Fund.[1] They don't have a problem with the company keeping women in their place. It may even be viewed as a plus, influencing an American company to adopt Saudi values.

[1] https://www.nytimes.com/2016/06/02/technology/uber-investmen...

I suspect even the most misogynistic investor will balk at the poor publicity like OP's story, and especially at the stack of harassment lawsuits that are sure to be in the pipeline if all these employees grievances are accurate.

how the fuck did Saudia Arabia investors make it into a conversation about SF company culture..

Saudi Arabia is keeping Uber alive. Without that $3.5 billion cash investment from last summer, Uber would be in serious financial trouble now. They wouldn't have been able to get the $2 billion loan that followed, and would have had to raise rates to stop the cash burn. That would have stopped their growth and cut their market share.

and none of that makes any difference to company culture. if it was toxic without money it wil be toxic with money.

To assume there is a disconnect between a company and the investors that fund it is pretty naive. For starters, major investors almost always get board seats, which means they have a direct say in managing the company. Besides that, there are numerous articles that discuss how taking VC money has ruined many companies - Zenefits is the most popular recent example.

VC momey doesnt ruin anything. shitty managers do.

any investor or board member whonis aware of the type of activity mentioned by OP would shut it down fast. their first responsibility is to protect the company, especially one about to go public, and that doesn't happen when you're getting sued repeatedly for hostile work environment and/or sexual harassment.

VC's main goal is for their investments to grow and grow fast. They know most of their companies will fail, and they don't want to waste their time on the companies that will only net them a modest return when they can focus more of their efforts on the company that will net them a 20x return. It's actually in a VC's best interest for you to either be a rocket ship or for you to fail completely, as mathematically it's the best use of their time for maximizing profits.

VC's aren't trying for all of their portfolio companies to be profitable - they're trying to fund 1 company that is going to be uber profitable. There's a saying from the dot com investment days - you either invested in Google or you didn't.

Saudi Arabia's sovereign wealth fund isn't a VC. They're a late stage buy-and-hold investor.

Do you believe the behavior described in the piece is a result of Saudi investment? Your comment leans in that direction, which is quite an insinuation if that's not what you actually believe to be the case. If so, I'd like to know more about what leads you to believe it is, or is even likely. It seems to me that much more prosaic explanations are likely.

My reading is that their belief is that Saudi investors wouldn't care about such behaviour or consider it marginally positive, as a contrast with non-Saudi investors who might reconsider doing a deal given such information.

I think this sentence is implying something much stronger than that:

It may even be viewed as a plus, influencing an American company to adopt Saudi values.

I'm unsure what difference you see between "a plus" and "marginally positive" except I'm specifically pointing out it's probably a secondary consideration to profit.

Interesting take. The operative word for me is influencing. Thanks for pointing out in detail where you where getting your reading.

Investors pull the strings. The behavior isn't the result of an investment, but failing to implement procedures after the fact to stop future incidents definitely can be. Not through action, but through inaction.

Meaning, more ethical investors (also known as: Board Members) might say "We need to do something about this."

"Uber passengers were paying only 41% of the actual cost of their trips; Uber was using these massive subsidies to undercut the fares and provide more capacity than the competitors who had to cover 100% of their costs out of passenger fares." Is either mathematically incorrect or extremely misleading. You can't take Uber's cut of passengers payments (~18%) and then divide by Uber's costs to say "passengers were paying only 41% of the actual cost of their trips", as the bulk of the cost of the trip goes directly to the driver. If you take this into account the rider is actually covering about 80% of the total cost of the trip, with Uber subsidizing about 20% of the cost on average, which includes their massive infrastructure building and expansion efforts. This means that even break-even Uber at a 25% higher cost, or a 20% profit margin Uber at a 50% higher cost, is still cheaper (and more convenient and enjoyable) than a taxi.

In which case, isn't taking Uber and forcing them to eat that 50-70%, the ethical thing to do?

The 50% that you are forcing Uber to pay is 100% that is denied to Lyft, and additional pressure on drivers to keep the Uber app open and the Lyft app closed.

To be sure, ethical consumer choices are a luxury and consequently you'll have to pay extra to make them.

If your only concern is the sticker price, then that is a ethical choice that you're certainly entitled to make, but that also necessarily involves a choice not to account for what goes into that sticker price (parallels with e.g. Walmart), and thus is a pretty limited principle. Possibly limited to the degree that it is actually merely self-serving.

Are there any Uber competitors in your city?

It should cost them employment talent, which should be a factor against them versus other employers with less toxic work cultures, all else being equal.

They are used to break the laws, it's called disruption, I think.

Disruption doesn't necessarily imply illegal activity.

But Uber does.

Then that's the point that should be made, not some vague innuendo about an aspect of entrepreneurism in general.

In fact many current industries engage in illegal activities. Most often cartel behavior and price fixing.

Generally this behavior is not curbed already because it's hard to prove price fixing without having concrete information about the communication. Technically you don't need to have communication, but it's hard.

Sometimes all you need is one new vendor to enter the market place and not play by the old rules.

As someone who was truly frustrated with the taxi system for years, to the degree of refusing to use them hardly at all, I don't mind so much Uber breaking outdated laws (I do believe some kind of taxi commission is warranted in general) so much as the results of their business model: replacing one mafia with another. That a secondary effect is to flood the streets with even more batshit-awful drivers is proof that they aren't disrupting anything but taxi management and not hacks[1] in general.

1. http://answergirlnet.blogspot.com/2007/07/why-are-taxi-cabs-...

It could even be worded like this: Given most taxis across the world provide a dodgy service and hijack fees way above official metered levels (or hijack meters or add luggage fees or spend 20 minutes negociating the fare after you've made them aware you're in a hurry for a flight) to the point that most middle-class doesn't use them, ... is replacing this mafia with a batshit-awful company still a progress?

As long as the middle-class now can afford taxis on a regular basis, and the offer of drivers is in an all-time high, with better control of driver and passenger identities, then it's an economical plus for the society. Of course there's Lyft and Grab too.

Naturally, in some places the taxi service is 1000x worse than what I ever complained about, so in those places I can see the up-front pricing for Uber to be a little bit more of a revolutionary improvement.

I think overall the experience of taking a taxi is not going to change that much, but there's going to be a big repricing when Uber runs out of loss-leader. I imagine the dream is for inflation to absorb most of that by the time the axe falls, but uber/lyft/taxi pricing across the board will have to find an equilibrium. Or differentiators.

probably because "Brilliant Jerks" are tolerated

Yup. There was the article a couple days ago about how employers should avoid the "brilliant jerks", and everyone in the comments was saying how they'd rather have the "brilliant jerk" than someone who was nice and mediocre (despite the fact that isn't the choice at all; there are plenty of people who are talented and not asshats). Well, when you make that decision, this is the kind of workplace you get.

There is no pressure to change when they can continue to get billion-dollar handouts from Saudi billionaires no matter what happens.

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