Hacker News Reader

Comment by tootie | Hacker News Reader

Uber is an international brand for taxis. I'm not even sure why they are considered a tech company.

It's a mystery. They do have a nice app for hailing their taxis, but so does my local "legacy" taxi company.

Similarly: Why is Blue Apron a tech company? Their business model is putting food in a box, and then shipping it to people. That's great, but my local grocery chain does that too?

And then there's Juicero, who's only claim to being a tech company seems to be they printed QR codes on the packaging, despite the QR codes being entirely unnecessary to their core business. If Kraft puts a QR code on a box of mac and cheese so you can scan it and get a cooking instruction video on your phone, do they become a tech company too?

It's just branding.

My guess is that it's "cool" to be a tech company. It gives an excuse to not be profitable. Get wider range of talent.

My current and my previous company is a traditional business, both more than 20 years old. They sell a product or service that has existed for decades. But damn they both tried to say we are a startup, we are a tech company, etc etc.

I see you've read Matt Levine's newsletter:

https://www.bloomberg.com/view/articles/2017-08-09/yogurt-li...

They're virtual-reality companies.

After the slashed IPO pricing and the continued downward trend since, besides the fact that Blue Apron's unit economics are dubious, the market has been crystal clear that they don't value Blue Apron as a tech company.

https://hackernoon.com/blue-apron-is-not-a-tech-company-neit...

This always blew my mind: a smartphone app for a cab company that doesn't even own any cabs raised $16 billion.

It simply can't be that they spent even a small fraction of that writing software, smartphone apps just aren't that expensive. But they've got one helluva marketing engine and investor relations group...

That, and a lot of their money is buying market share, effectively subsidizing people's rides.

I've never understood how that's going to work, beyond vague handwavey arguments about potential future driverless cabs and other complex arguments that don't seem backed by data.

I think the lesson here is that kickstarting new markets (entering new countries) is not easy. They basically have a local or regional team that needs to find a way to drive user adoption. They also spend a lot of money on promotions to change user and driver behavior.

IMO it doesn't do them just when we say "it's just an app". It's a complex operation that they've simplified to appear as that way.

It's fine to spend money driving a new market but you eventually have to capitalize on it. How will that work? Large price increases, or just betting that driverless tech will eliminate costs and get them to profitability?

Also, they already have substantial scale. When would one reasonably expect them to stop losing so much money?

Just take a look at Didi. They won the market in China and now prices are up, driven incentive pay is cut, wait times are up because drivers are leaving the platform because pay is down.

https://www.google.com/amp/amp.timeinc.net/fortune/2016/09/1...

When they stop expanding worldwide. The world is an extremely large place. Paying drivers hundreds of dollars to sign up with Uber in hundreds of countries is a massive startup expense.

I agree with you. I was simply trying to address the comment that it's "just an app".

Well, it's clearly a very successful business. But to your point, their success if their ability to break into new markets. Striking a deal with the Taxi and Limousine Commission in NYC was probably their single most valuable innovation and it was lawyers, not programmers who pulled it off.

Reply on news.ycombinator.com