SF wants startups to behave, so why did it reject the ‘nice guy’ of e-scooters?
sfchronicle.com
sfchronicle.com
But the bigger point is that the SF government apparently places more weight on minor application mistakes than actual, historical "bad" behavior.
That's why this is so comical. It only feeds fuel to the truth that rules should be bent and there really is no point in "moving slow" for startups. You won't be rewarded for it. Most tech entrepreneurs already know this: Airbnb and Uber proved this point long ago.
This has been my experience with pretty much any bureaucracy, regardless of locale. E.g. when I incorporated my company, I had to send in the same application four times, each time paying an additional fee. Reason was I had minor, pointless really, mistakes in the application, a box I didn't realize had to be ticked, name in the date field and date in the name field, that sort of thing. The data entry people at the government agency could have easily resolved any mistakes with a phone call, but instead I get a letter in the mail a couple of weeks later, saying there's an error but not what the error is. So I have to call and ask, and of course they had no record of what the error was so we had to go over the application on the phone and find them. You'd think they'd tell me about the other errors then, but no, I had to do this four times. It took almost two months to get a simple form approved.
I wish that was my only story of wasting time on bureaucracy, but there are plenty more where that came from.
Government officials will always choose the easiest path forward - and that is almost always inaction.
It doesn't have to be this way.
I incorporated my first company in Chicago, and was stunned with how helpful the bureaucrats were.
Yes, it was a little complex, especially in the years before "startups" were a thing, and you could do stuff online. But each department I had to work with had people who would sit me down at their desk and explain what they did, why I should care, and how to fill out the forms properly.
Maybe the difference is that back then, you were expected to form a company in person, and not do everything online all by yourself and be an expert from day one.
A massive thanks to the Illinois Department of Revenue people in the basement of the Thompson Center for all their openness and hand-holding.
(In spite of all this, I still moved the company to another state a few years later because of Chicago + Illinois taxes and corruption.)
On the other hand, dealing with private bureaucracies such as internet providers has always been a major pain. Very unhelpful, not accommodating at all.
Starting with the experience of moving to the state, to contrast (Upstate) Western New York vs Indiana:
My New York insurance provider determined that I was no longer residing in the state, so mailed me a letter of notice that my vehicle insurance was being cancelled. In truth this was the best thing that could have happened, because Indiana insurance is so much cheaper, and I got a deal through my new employer. I was dragging my feet on this because I did not know better about it, and knew it would be painful. So I went to get new insurance, and learned I would need to re-register my car...
Visiting the Indiana BMV was like no other auto vehicle registration experience. They were able to take care of me same day, and with no long wait – I waited up to at most 15 minutes to the desk. I was not shuffled from one desk to another, we completed the process in a single desk visit. On the other hand...
New York requires you to surrender your plates when you leave the state. If you fail to surrender in a timely fashion, you will be fined punitively. Indiana has no such requirement, they trust you to destroy the plates when you drop a registration for a vehicle. In fact, when I brought plates for my second vehicle to the BMV to surrender them, as the lease was being grounded, not only did they let me know that they actually don't do that at all, I don't need to do that, but also that I was entitled to a credit for the portion of my registration that I had not used (which is fairly substantial, as it is based on the worth of the vehicle and paid annually, like a use tax.)
The desk attendant was able to help me fill that form out before I left, and about 45 days later, two checks came in the mail. Being from New York, I found this kind of experience at a bureaucracy to be quite pleasant and seemingly impossible, (and from what I hear asking people who are born and raised here, it has only just become this way recently because of many reforms that have been applied in the past 20 years.)
A place like New York or Illinois is stuck dealing with all of the bullshit generated in New York City or Chicago. Registration and titles are impossible as a reaction to the industry the popped up in the 90s “laundering” stolen cars by swapping in salvage titles. Same deal with rings of people who’d purposefully cause accidents to defraud insurance companies for phony medical procedures.
It’s even worse with trucks, where there is a complex web of federal, state and local regulations, which scummy operators are good at exploiting.
I was making a LLC, so it was pretty straightforward and no surprises.
Once the SecGen approved it, getting IRS numbers was a whole 5 minutes. I also wish to sell things on Kickstarter/Indiegogo, so I applied for indiana tax numbers as well. $20 for 2 years.
Specific reforms intentionally undertaken to solve known problems with the system, made the system work better.
As a life-long New York resident until about 4 years ago, I can also tell you that I probably wouldn't disagree if you told me you thought this was "not possible in New York."
(And intuitively I'd say, it's not because of population numbers, but I can't put my finger on exactly what it is. There is a different mindset, whatever causes it I can't say, but I noticed immediately when I moved here, I still tell folks this place really just isn't like New York.)
To elaborate a bit more, I felt like part of the New York mindset was basically psychologically planning oneself around not getting robbed. There were plenty of ways to get robbed that people just don't worry about around here (and some of this can surely be attributed to population issues.) I'm not just talking about general common-sense things like making sure that valuables are not left visible in your unlocked, parked car. I mean up to and everything including neighborhoods which don't have enough driveway space for everyone in large duplex houses to park their cars, where the streets are marked for opposite-side alternate day parking.
So I don't have a private place to park my car at my rented house, and I have to park on the street, but I can't park my car on the street and leave it for 48 hours time without getting a ticket. This makes sense in Upstate New York as a condition required for Winter road maintenance, so that plows can get in and clear the snow off of the road. Only it's not just a condition required at Winter time, and when you point this out, people just accept it and say something like "yeah, well, they gotta make their money somehow..."
This is the cause of the race to the bottom. All that hand-holding is really expensive.
It's like the cover charge at the bar of bureaucratic suffering. Generally it's what follows that becomes painful, depending on the business you're in and how large/active/complicated it grows to be if at all.
I incorporated my first company as a teen, following instructions from a book in the local public library. I don't remember it requiring more than filling out and mailing some forms in.
For example, I doubt as a teen you set up any kind of worker's compensation payment system for your employees.
You're just doing rubber-stamp "so he/she wants to be a corporation and pay taxes and employment security overheads, quarterly filings, and give us opportunities to bring on the hurt in the future, Sure thing!" kind of crap.
That means either training people to be experts in whatever they are doing or removing agency from the individuals in the system.
Having people with the right training, etc is obviously the better path, but it costs more. End of the day, this is why devops is a thing — traditional IT operations only does what it does, which is a problem when you’re changing and growing.
This obviously isn't an excuse for dump or inefficient processes, though.
I'm reminded of the opening of Hitchhiker's Guide to the Galaxy, which satirized this 40 years ago.
In my country (NZ) you can incorporate a country online in an hour. You will need to scan or fax your consent to be a director/shareholder forms though.
https://companies-register.companiesoffice.govt.nz/help-cent...
Likewise, I can update my income details for family tax credits etc. online with the IRD, our income tax system is very simple (sometimes referred to as pure) so I've never needed to file a tax return.
I apply for hunting permits on government land online, and when I change address, I'm required to notify the Police as a registered firearms holder, which I do online, they then email me asking me to document my secure firearms storage, I email them a brief description and some photos, and then based on that, they decide whether or not to send out a Police Officer to confirm.
I renew my car's registration online when emailed that it's due. On the odd occasion when I've gotten a speeding fine, I pay that online also.
It's really all about complexity of legislation, and administrative desire to minimise red tape. Our government, fortunately, in the more important areas, has made active endeavours to reduce legislative complexity, and red tape.
Funnily enough, I hit a lot more bureaucracy dealing with large companies, than our government.
So, not only in america then?
The reason why I am asking is because as a EU citizen, my experience is that that bureaucracy in northern europe is very different from bureaucracy in southern europe.
Sure, It's not perfect anywhere, but framing this as a problem that can't be fixed, that it is equally bad everywhere is in my view not just wrong but actually harmful to society.
This does not match with my experience.
Bureaucracies, like human being, vary greatly. I was able to incorporate in Colombia at the department of commerce four years ago barely speaking Spanish, in just a couple hours as the bureaucrats there were very helpful.
I've also tanked tens of thousands of dollars on lawyers and spent over a year trying to reconfigure my corporate structure in a way that seems fairly trivial to me in Canada.
The idea that all bureaucracies are inherently evil is a self-fulfilling prophecy imo.
Many laws don't have a consequence.
Many laws were written by your rival.
Many laws have consequences that have nothing to do with closing your Series C which is a far greater incentive.
Disagreeing with this reality doesn't change the accuracy of this reality.
Yes, it is important to remember that the state is imbued with power, and also in many areas they have discretion, so if you want something discretionary from the state you need to maintain a relationship with them or leverage.
But the term you need to remember is "toothless", there are some toothless laws, and some toothless enforcement agencies
When the consequences are negligible you can consider acting accordingly
Disagreeing with why you got a ticket doesn't matter once it's written.
Breaking a law doesn't matter until it does, and then it can hurt quite a bit- that ticket cut into my Christmas present money. Similarly, breaking laws with you company can impact your bottom line, and your credibility.
I'm still going to enjoy the accelerator, but I have learned not to do stupid stuff when you can't see everything that's going on.
Same with laws, and car parts- if you don't know why they're there, you oughtn't break / remove them.
It might or it might not matter. Many startups have proven that if you just move quickly enough, you can get away with it for long enough to become a successful company. And by the time that happens, you can just get the law changed.
OR, SF used the tiniest technicality to reject because it's easier and immediate than on grounds of previous bad behavior ;)
Corporations have figured out how to use incentives, winks, and nods to avoid having anyone but the lowest level employees end up with provable beyond a reasonable doubt intent level mens rea. But we have solutions to that in our toolkit. We can define crimes as requiring only negligence or even strict liability crimes.
We need only summon the collective will.
And if you can't follow a simple set of instructions that is life or death for your startup then the management that oversaw the application (the legal team?) should be fired immediately.
I hardly see anyone using them in SF anymore. It’s cheaper to use just a regular Uber.
I’m convinced the only people using it now can’t do basic math.
I use an eskate so it does not apply 100% to scooter with wheels that are twice as large, but most of my learning curve has been around learning to deal with bad road conditions.
The roads I usually take are riddled with potholes or crossing rail tracks with huge gaps.
Cars (or rather their drivers) are also very dangerous.
I still skate to work almost every time when the weather permits but I can understand people choosing to use a car instead.
I have good hopes for the future. Once Market Street becomes more welcoming to bikes, that will open up more possibilities, adding a couple more bike oriented streets could make the whole city way more bike/skate -able.
And the completed rubrics of each of the applications here: https://www.sfmta.com/sites/default/files/reports-and-docume...
With other related documents here: https://www.sfmta.com/reports/2019-scooter-application-evalu...
While the rubric grading might have seemed overly strict and bureaucratic, keep in mind that at the end of the day it's intended to stand up in court because the SFMTA could get sued given how high the stakes are and would have to demonstrate that it was a fair and transparent process.
As well, the priorities are very different now compared to 2018. The initial pilot accepted open-ended proposals and had the goal of determining whether scooters were in the public interest at all - Scoot and Skip won because their applications addressed concerns that none of the other applicants did (https://www.sfmta.com/projects/powered-scooter-share-permit-...).
This process was essentially an RFP where the SFMTA was clear on what they wanted, meaning that the firms with more operating experience, better equipment, and a stronger financial position had an advantage.
The broader issue is why even have an artificial limit for scooters? Imagine if SFMTA limited roads to just 2 car manufacturers and a set number of vehicles...
The problem would sort itself out real damn quick.
As to the second question, despite being pretty pro-regulation myself, I don't know whether the artificial limit is really worth imposing at this point. A year and a half ago, I would have said maybe it was, based on the way scooters had become a borderline menace in San Jose -- but there don't seem to be nearly as many of them now, I suspect in part because the novelty has worn out and in part because, as someone else noted in this comment section, the prices have substantially jumped compared not just to the $2-for-30-minutes rental bikes (when they're available, granted) but to Uber/Lyft.
Notably, Lyfy was rejected with much higher scores and no failing categories. So Skip didnt even barely miss. It was a true whiff.
Ultimately sad, because yes, SF does have issues with companies not following the rules and profiting, but this does not appear to be such a case.
Thanks for providing the actual data.
The founder’s take-away from this should have been “double-check the details, especially when dealing with a bureaucracy” instead of “optimize for the short term”. This was an unfortunate but entirely preventable outcome.
It's absurd to punish someone because the formatting was wrong.
In the case of software, being clever means that you open yourself to unintended result, vulnerabilities and such, in the case of bureaucracy you open yourself to lawsuits, corruotion charges and lenghty trials
Sadly, politics only cares for people actively involved. If you want different behavior, communicate with an elected official, try to elect different people, or run for office yourself.
That is a lot of UX designers.
Of course a helpful bureacracy will ask feedback in order not to waste your work, but unless you know how it will work expect the worst and act accordingly
One could argue that these formats are more accessible than their equivalent pseudo-paper formats. It would eliminate the nitpicking over document format, as the low bar to enter would be enforced programmatically.
This would allow technologists with lesser experience in the minutia of proposal writing to compete with huge government contractors with specialists who deal in final proposal preparation. At least it would in the short term until the big contractors retooled.
If what it expects had an exhaustive formal spec and also an automatic validator, that would work better.
Without meaning to imply that Skip did anything particularly wrong, I intended to dispute the lesson its CEO took away from the experience. Skip wasn't in a position to change the bureaucracy: it simply wanted to get something from it. The advice given was implicitly for other people in similar circumstances, so I modeled my take-away for the same context. Dysfunctional bureaucracies are widespread, and knowing how to successfully interact with them is a crucial survival skill in modern business. Doing everything exactly by the book is how you do that; declining to invest in the future is simply an admission of defeat.
If your company was bidding on a request for proposal (RFP) for a potential client, wouldn't you want to follow the customer's requirements?
Often RFP teams use failure to follow directions or specifics in a proposal submission as an informal measure of the likelihood the respondent will fail to deliver on other requirements.
I have worked for a company where I had spent 80 hours building a demo for a potential client. We did not make it to the demo phase due to a failure of our proposal writing team to address some technicality in the written proposal. I don't hold this against the client we lost; this falls on those whose jobs are solely writing and submitting technical proposals.
If a robot were processing these applications then the error might be forgivable. But if you’re a human on the job, society expects you to use the reasoning skills of a human.
I think the sort of person that would reject Skip’s application is someone that society would be better off without them in their current position. Hopefully one day they realize how their incompetence is hurting both people and progress, and either work towards using those reasoning skills or find a position better suited towards them.
Except it doesn't. Then society labels the process as biased, unfair, subject to the whims of the reviewer, open to corruption, and so on. One of the down voted comments jumped right to bribery for example.
Bureaucracy is this way not because it has to be but because society actually wants it to be.
If a reviewer cannot do something trivial like this, then we don’t need them anyways. If the content doesn’t matter, as this bureaucracy has demonstrated, just run the application through a software that checks for word count and header presence and call it a day, and use those tax dollars towards a cause that would actually benefit society.
In this case, the employee tasked with separating out the application pieces and sending them to the relevant specialists is likely not highly-trained, and there may be no-one in the organization competent to do this: the people that process the application as a whole aren’t qualified, and the people that are qualified can’t look at the whole application for fear of introducing bias.
> If the content doesn’t matter, as this bureaucracy has demonstrated...
I saw no indication that the contents of properly-formatted applications were being ignored. I believe it’s more likely that they set up a complicated review process that relied on applications being formatted as requested, so Skip’s application couldn’t be put through the pre-planned approval process.
I do find it ridiculous that they were not able to present a correctly field document for what such a crucial RFP.
I see something of an analogy to the brown M&M's rider[1]. They don't particularly care that there are no brown M&M's, but the presence of them is a massive red flag that you have cut corners or not done your due diligence.
[1] https://www.insider.com/van-halen-brown-m-ms-contract-2016-9
Read the RFP carefully for formatting instructions and follow them precisely. For example, if the RFP says the proposal is to be double spaced, and does not make an exception for tables, double space all tables, no matter how silly this looks. The Department of Education, for example, will often reject proposals for non-compliance for just such nitpicking instructions.
We've seen innumerable proposals rejected for slight page limit violations, font violations, and similar minutia. Is this bullshit? Maybe. But if a funder is looking for reasons to reject you, and some are, try to give them as few reasons as possible.
If you're the bureaucrat reading applications, and you have a lot of applications that you need to narrow to one, you'll toss them for even the most minor rule violation.
Uber and Lyft would not exist if they had "played nice". We can imagine a world where certain regulation would have improved their service for riders and drivers. But in the real world, if they had complied with every ask, cities would have crippled them with requirements when they first started. (Ok, you can do your Lyft thing, but let's start with 100 cars, for say, the first 3 years).
A lesson for regulators, regulation creates environments where the people who succeed are the ones who work the refs and skirt intent. These are probably less likely to be the best companies or the nicest people.
So a quick call, like "hey, put A3 in here or we can't count it" could make the world a little better. And if you would prefer to regulate people who follow the intent and not the letter of the law, you need to govern that way.
I hardly ever see anyone riding scooters in SF. The scooter companies keep raising their prices in lock step because they have to, but it’s now gone from $.15/min to $.32-.33/min, which is more than $20/hr with tax. It’s cheaper to just use an Uber.
Have no idea who they are targeting with those prices. Kids can’t afford that. Adults would rather take an Uber at those prices.
After they stopped servicing SF, I tried Uber's red scooters and they really sucked. There was not enough torque to get up 90% of the hills in SF.
I downloaded the Spin app in frustration but on one attempt wasn't able to get a scooter.
Skip indeed seemed to be doing the best out of all these companies.
I had to complain to the city twice about a Skip distributor’s aggressive strategy of tying their scooters in the early morning to every available bike hoop (and even trash cans) around the Twitter building.
The city has rules about how many scooters can be tied to a public bike hoop and at least one person at Skip was not nice and was ignoring that rule.
They didn’t submit the required information in the required form. SF wants startups to behave, that doesn’t mean that behaving startups get to ignore the standard procedures or get exceptions from requirements.
For such a large city with a huge amount of tax revenue, I would expect the bureaucracy in SF to do a little better with processes like this one. It would have been trivial to review these for required sections in advance or to give companies time to submit corrections. Obviously this isn’t how it works, like you stated “standard bureaucracy”, but I’d love to see certain parts of government move further away from this mentality of being some punishing Old Testament god to serving the community.
Absolutely. It is trivial! And the company making the submission is expected to do that. Which I think is very reasonable, considering that they know the requirements and make the actual submission in the first place.
It’s silly to want the reviewers to take on an additional burden in the process just because this one company made a dumb mistake which as you say would have been trivial for them to review and catch.
The reality is that the bureaucrats just don't wantT more startups and so they use excuses to obstruct them.
Certainly sounds like what happened here - a bored, lazy bureaucrat scanning the application for a heading and tossing it in the bin when they didn’t find it.
I’d far prefer a bureaucracy where the employees cared, even if it was caring about the “wrong” reasons.
I have a friend who does this for research grant applications.
Why not start a new city say, in an open spot somewhere with minimal regulations and let tech companies build and innvoate as much as they want? Sure, in the beginning you need to provide incentives for some companies to go there. but once the jobs are there, people will definately follow.
SF and NYC are hotspots because that’s where the money is. That’s where the rich people are. They like to invest locally when possible. They like to see the billboards of “their” companies on the way to the airport. It’s an ego thing.
Obviously this is a generalization and not true in all cases. But it’s true enough and that’s why it’s the way that it is.
They all more than doubled their prices in the last year to $1 + .32/min + tax, which works out to more than $20/hour! At that price, it’s cheaper to just use Uber.
What Ubers have you taken in the city that work out to less than $20/hour? Even for Uber Pool that's significantly less expensive than what I've experienced.
And it kills the use case of keeping the same scooter rented for a few hours while you hop around and do errands or go around the city since it’s too expensive now.
Frankly I do not like these scooters. We have bicycles made from iron and aluminium they are fully recyclable vs this electronic plastic e-waste ie scooters.
I mean there is a difference between reasonable regulations and just outright picking 1-2 cheaters who bribed you for the right to offer a service that supposedly free people are willing to pay for out of pocket.
We get stories about this in Russia and China and call it Putinism and Corruption all the time.
And why is it bad? For one, real intentions are inscrutable, so it is very easy to ascribe whatever intentions you want to an action. For another, the intentions behind an action have essentially no correlation with the effects of the action, at least insofar as the intentions are not explicitly malicious (e.g. 'hurt people').
The most common alternative that I can see is "you can do whatever you want as long as it follows the letter of the law". However, that doesn't seem to work well either.
Yeah, in that case, all the long term residents living in popular cities must be insane to hate Airbnb. Have lived in a city and a building infested with Airbnbs? If you did, you would how fucked up it is for a long term renter.
This drives up prices for locals.
The other tenants are mad because landlords prefer renting apartments to tourists for 5k a month instead of renting to locals for 1k a month.
If people just rented out their guest room, or rented their apartment out while they're on vacation, I don't think anybody would complain.
If this is happening it's because your city has a massive shortage of short-term rental properties. If you can make $5k a month then people should be building those properties left and right since it's so profitable -- but what most likely happened is that your city passed rules effectively prohibiting that construction, so now there's an arbitrage opportunity by converting long-term rentals to short-term rentals.
You should direct your anger at your local government for doing nothing to address the high short-term rental demand, because if they did then that wouldn't happen. And the same rules tend to restrict the availability of long-term rentals as well, which means that they were causing your rent to be higher than necessary even before people started converting neighboring units.
Yes, so what? Why should a tourist be forced to pay more than a "local" (who might nonetheless move out of town at a moment's notice) for what boils down to the exact same service?
I actually think cities tend to overregulate Airbnb (and housing construction), but if your model of housing policy can't tell the difference between a tourist and a resident, it's woefully incomplete.
And luckily these affordable car transportations don't drive around the city empty most of the time, causing huge traffic congestion.
And if it still comes out cheaper it’s for a reason e.g. no security, no housekeeping, no amenities, no one to help you.
Why is this a bad thing? It's just unbundling security and housekeeping and lowering the price correspondingly. If you want the full-service option hotels still exist
And like I said in a lot of places an Airbnb is not actually cheaper than a hotel, so in that case you’re getting ripped off because you pay the same price as a hotel without any of the benefits a hotel provides.
I can’t be happy “living like a local” when I’m wondering in the back of my mind if the apartment I’m staying at was illegally turned into a hotel (most likely yes) and getting dirty stares from the neighbors that actually live there.
Somehow -- honestly, I'm unclear on how -- they survive.