
Read This Before You Build Uber for X - capocannoniere
https://blog.ycombinator.com/read-this-before-you-build-uber-for-x/
======
mooneater
I think this misses another critical point.

The platform owner only retains control of the transactions, if they keep the
buyer and seller from getting to know one another.

For Uber, thats easy, because the nature of the service means you want a close
car (typically, a different one each time)

But for Uber for local babysitting, why would the buyer and seller not just
leave the platform permanently after meeting, and transact directly, saving
both the fee?

"Sharing economy platform" commercial success depends on avoiding lasting
local human connection.

~~~
damnfine
Man, that just kinda feels dirty, but its true. Even for uber! An (ex?)uber
driver I know in a semi rural area now just connects directly with locals and
runs a charter to and from the nearby city, as those were most of his fares.

It also kinda hurts that the isolation of people is seen as financially
viable. I would argue, but with very little to back me up, that there is an
intangible (and perhaps a tangible) benefit from closeness to those we
associate or do business with, that we are losing.

~~~
Razengan
> It also kinda hurts that the isolation of people is seen as financially
> viable. I would argue, but with very little to back me up, that there is an
> intangible (and perhaps a tangible) benefit from closeness to those we
> associate or do business with, that we are losing.

As an introvert, I appreciate that there are services that isolate me from
unnecessary contact with people.

Where I live, taxi drivers often try to strike up conversation and get
"friendly." Not only that's awkward and uncomfortable for me, here it's also
generally not very safe to indulge in chitchat with strangers (you can get
marked for scams, muggings or worse.)

~~~
preordained
I'm an introvert as well...plenty are...but I don't think avoiding
"unnecessary contact" is really healthy. Introversion is a weakness as I see
it honestly...a negative feedback loop of underdeveloped social skills
yielding yet more fear, insecurity around social contact. It's not a binary
condition like I'm a Leo or a diabetic. Just saying, it's probably better to
view as personal challenge than a condition that needs to be accommodated
outright.

~~~
Baeocystin
Social anxiety and introversion are not the same thing. I am an introvert, and
need a lot of alone time to feel properly refreshed. People, even ones I love,
wear me out.

But I have no problem whatsoever interacting, and have zero social anxiety.
Need me to talk in front of a group? Sure! Meet new folks? Great! And I
genuinely enjoy doing these things. But it burns a lot of mental energy to do
so. I need quiet alone time, too, and a lot of it.

I say this not to make anyone feel bad about social anxiety, but rather to try
and make people _not_ feel like introversion is a defect. It is not, in any
way, shape or form. So seriously, don't beat yourself up about feeling
introverted, if that is how you are. Anxiety is a different beast, and working
on that will help. And if you get it under control, and still enjoy an
introverted lifestyle, that is 100% OK, normal, and healthy.

------
kbenson
Am I the only one that sees "Uber for X" in a somewhat negative light? In my
mind Uber does relate to dominating an industry and getting big, but more in a
Microsoft of the 90s sort of way, where there a lot of negative baggage
associated with it because of what looks to be unrestrained greed. For
example, I'm not sure I would want to advertise my actions as trying to be the
next Oracle. That probably only comes across as entirely positive to those
that don't know much about Oracle or only care that they make an obscene
amount of money.

Is this just me? Or is it perhaps time to retire this idiom?

~~~
sillysaurus3
I think Uber for X is a fine term. It's short and conveys the idea
unambiguously.

It also filters out people who can't separate their feelings for Uber from the
abstract idea being discussed, which tends to be a net win.

The main issue is that Uber for X is very hard to pull off, as the article
illustrates. So it doesn't really matter how you pitch it.

Grubhub is Uber for food, for example. Perfect description and no negative
baggage.

~~~
goialoq
"Uber for food" doesn't convey anything to me.

GrubHub is a food delivery service, isn't it?

------
the_stc
Nice timing. We are working on "Uber for Sex" or "Tinder + Buy It Now". On the
lower end of the market, it can be a low skilled job in the sense that a lot
of people know how to have sex well enough to satisfy a lot of clients.
Certainly going upscale or into niche offerings that doesn't hold true. So our
system is somewhat split into people primarily booking on cost and schedule,
versus people booking on the entire experience. I think we'll manage to handle
both acceptably enough for all parties involved.

On-demand? There are a lot of scheduling difficulties. Getting a sex worker on
short notice, even in a popular and mostly-legal city is a nightmare. And it
runs into the Airbnb-pre-instant-booking issue: You contact several people,
they don't all get back right away. Then an hour later, you have several
replies, and since you can't book them all, some end up annoyed you're wasting
their time. Not to mention any screening issues or other deal-breakers.

And if someone does have some last-minute availability? They can't easily fill
that slot. It's hard to just offer sex work in a few hours here and there -
you'll spend all your time answering phones.

But it isn't just the "Uber" aspect that we're working. Sex workers lack
cohesive unions and shared resources. We'll be able to pool for things like
security agents. We can handle client verification one time and be done.

We'll do photography of workers, then advertising and bring clients in. This
benefits less entrepreneurial workers that don't want to try to manage an
online presence, deal with SEO, try to A/B test their photos and copy, etc.

There are other similarities. Uber had to avoid LE, so do we. Uber has to deal
with partial cash payments and reconcile, so do we. Uber offers some
insurance, so do we (legal). But we'll be far less sexist than Uber, that's
for sure.

~~~
venantius
There's no way you survive the eventual law enforcement issues here. Uber
circumvented law enforcement on certain issues by operating in a legal gray
zone - you're offering a platform that will unquestionably make you a prime
target for an FBI investigation, at the very least.

EDIT: And it's not just the sex aspect of what you're doing. Your business
model is going to be so ripe as a target for a money laundering investigation.

~~~
tj-teej
Surely this post is Satire...

~~~
svantana
If it is, then it's very thorough. Looking at the OP's profile, there's a link
to the site and everything. Sometimes truth is stranger than fiction...

~~~
the_stc
We're completely serious and have already raised some money (doing a
blockchain fundraiser right now to get the rest to open our first market).
We're operating as an extrajurisdictional company. De-anonymization is a risk,
though we are taking a lot of measures to prevent that and, well, obviously we
are OK with the risk.

This is basically the only way someone can actually help sex workers. Disclose
your identity and do what we're doing and they come after you.

------
slg
The way I see it, there are three main things that contributed to Uber's
success:

1\. As discussed in the article, the service they provide is commoditized
making both employee skill and customer to employee relationships irrelevant.
If I like the person providing the service, what incentive is there for me to
not to continue to work with that person outside of the app?

2\. They connect people who are looking for a service with an untapped market
of unskilled contractors who can provide that service. I would never become a
full time taxi driver but I might consider driving for a ride sharing service
if I needed extra cash. A layperson like me is never going to work for an Uber
for massages.

3\. There is preexisting regulatory capture in the market that allows the new
entrant to provide a much better or cheaper service than the incumbents
(although here be legal dragons).

Ideas like Uber for massages or Uber for housecleaning don't work because they
fail all three of those conditions. Companies that meet multiple conditions
tend to be more successful. Postmates for example meets the first two
conditions while Airbnb meets all three.

~~~
jedberg
> while Airbnb meets all three

Heh. Given that AirBnB is a year older, really we should call Uber the "AirBnB
for car rides".

~~~
dismantlethesun
Perhaps. But Uber found product-market fit faster than AirBnB, which if I
remember correctly took a while to grow from being "just for actual airbeds"
for concert attendees to offering private rooms.

In the beginning, AirBnB was like Couchsurfer but with payments.

------
s17n
The article doesn't mention providers dealing directly with the customer to
avoid paying a percentage to the app. In any service business like
housekeeping where you have a long term relationship between the customer and
the provider, this is going to be an issue.

The article indirectly discusses this by talking about how an app can provide
value to pros in specialties with various characteristics, but I think that it
should have started with by saying "if you think you can take a 30% cut of
every transaction in a service business without actually providing substantial
value _in every transaction_ , it's not going to happen."

~~~
nkrisc
If I recall, this is one of the problems Homejoy had. What incentive was there
to keep using a matchmaker once you've found your match? It was beneficial for
both parties to form their own, direct relationship.

------
b1daly
I'm amazed that this article and most of the comments implicitly assume that
Uber is succeeding, and therefore useful as a an example of a successful
platform startup.

Uber seems to be failing badly so far, losing increasing amounts of money. The
ridiculous corporate shenanigans Uber has been generating seem of a piece with
a company that had massive investments, with expectations, and no clear path
to profitability.

Here's a link to a page that has some detailed, and damning, critical analysis
of Uber's prospects.

The gist of his argument is that Uber is gaining market share by substantially
selling their product below cost. But they have not found some kind of magic
solution to lowering the cost of providing their services by taking advantage
of scale or network effects.

The author argues that Uber is actually a high cost provider, in comparison to
traditional taxi services.

[http://horanaviation.com/Uber.html](http://horanaviation.com/Uber.html)

------
ahh
This is pretty interesting and apt. One thing I'd quibble with is their claim
that many professional skills aren't fungible; this is true in general but
there are many cases where a non-fungible skill is fungible for a major use
case.

In particular I'm thinking of doctors. I care a lot about having exactly the
right doctor (a good one, a specialist, etc) much of the time, but there are
many medical services where I simply need anyone competent to pass their
boards with a prescription pad. (I have been taking the same three or four
prescriptions since I was six for a few common ailments--I don't need someone
to tell me special information about albuterol.)

~~~
ilaksh
Right. And there is an app for that called Doctor On Demand which is where I
have been getting my Albuterol prescriptions.

There are other similar apps I believe but none that seemed too competitive.

------
cjcole
The "skill versus urgency" illustration has me wondering if the author foresaw
or even intended the resulting arguments over whether or not, for example, web
design requires more skill than dog training. It's one way to get people
talking about the article, I suppose.

------
jaypaulynice
Uber succeeded because they can reliable predict demand for services. They
have both historical data (rush hours, regular commute, etc.) and also future
data (sporting events, concerts, night life, etc.)

I looked at starting an Uber for healthcare when it was getting hot, but I
thought again about the problem. It's not possible to predict who will be sick
when and where and doctors are very expensive. Having doctors go to people's
homes is a lose lose situation because the time they spend driving is time
they could spend helping patients.

------
ilaksh
Great article.

Another thing to consider before you build Uber for X: there will come a time,
perhaps in the next couple of years, when people stop tolerating having
monopoly technology companies as intermediaries for everything. Or they will
tolerate some business involvement when it really is a deep value add, but
there will be much more competition and the types of fees being charged will
have to be much more reasonable.

The reason these companies become so huge so fast is of course because what
they are mainly doing is managing basic logistics and information flow
(payment being part of that).

The reason we need these companies, or think we need them, is because we do
not yet have practical and popular decentralized systems that can replace
them. Most people are not aware of the existence of decentralized platforms
that could possibly replace the centralized servers and banks.

But these decentralized platforms do exist and more innovations happen every
day. Popular examples are Bitcoin and Ethereum but that barely scratches the
surface of what is actually already a large ecosystem of peer-based systems
with many types of capabilities.

And I know that it will be really hard to convince most people that these
services could exist without centralized servers or payment intermediaries.
But maybe look into places like reddit.com/r/rad_decentralization or
r/Ethereum to start to get an idea.

~~~
seanmcdirmid
Has that ever happened before in the history of mankind with something
significant?

~~~
fragmede
Oil. Well, not oil _itself_ , since we're still heavily dependent on oil right
now. (Solar and alternatives are shaping up very quickly though!) At the turn
of the 20th's century, the oil tycoons like John D. Rockefeller controlled
significant percentage of the US GDP. (Google/Apple/Facebook/Snap's billions
are a pittance in comparison next to the US' GDP of $18.6 trillion).

Those oil fortunes were achieved via a wide variety of anti-competitive
business practices, and those practices are illegal today because the oil
tycoons' business practices stopped being tolerated, and US antitrust law
largely originates from this era.

~~~
seanmcdirmid
Companies still control and distribute oil, even if it isn't monopolistic
today, it definitely is not decentralized.

------
clairity
the article nailed it: for an "uber for x" to work, it requires (1) commodity,
low skill service combined with (2) on demand scheduling.

one thing it's 2x2 matrix implies is that both taxi services and delivery
services share a common appropriateness as "good" automatable services. but
that's not true. they certainly differ on the scheduling metric - delivery is
not nearly as on-demand as taxi service.

but there is another, more important variable that differentiates these two:
lcationality.

while a taxi service can start and end anywhere, delivery services are
constrained to start at particular locations, which makes logistics and
routing the primary challenge to overcome. you have to get vehicles to the
pickup point each time, which wastes time and money. delivery companies try to
overcome this in a variety of ways:

1) trying to deliver "anything" (deliv, postmates) to approximate a more even
geographic distribution of pickup points

2) subsidizing delivery through membership (amazon)

3) making delivery incidental to the core service (instacart is a marketing
channel disguised as a delivery service)

i'm sure there are dozens of other ways that companies are trying to overcome
this inherent last-mile logistics problem, but it's a real differentiator
between taxi and delivery.

------
swsieber
The solution I think is a little more like what a salon does - a good, shared
platform.

I think if somebody wrote a Uber for x _planning_ on the 1 on 1 repeat
business, they'd be fine... and how?

1) Provide real value for provider - an easy to use billing platform, scouting
out of the upfront work and risk, and classification of the customer and
(here's what I think would be the big one) work schedule management.

2)Provide real value for the customer, it be being able to evaluate a
provider, get good ratings (and here's the kicker) if the preferred provider
isn't available, they don't have to go hunting.

3) Let providers recommend each other. Temper that with user ratings and
platform specific ratings. Have users report when a job isn't done right, or
another visit needs to be made, etc. But the provider peer ratings are like "I
have too much work to provide x, you should try John, I trust his work."

4) The categorization of work could have meaningful use to the providers - it
lets providers specialize further than they normally could otherwise, and
provide a platform to fall back on.

------
rdtsc
> The reason for this high failure rate is most founders underestimate the
> intricacies and nuances of the specific service industries they are trying
> to uberize.

(tongue in cheek) So build a platform which allows startups to build Uber for
X. The real market is a desire to emulate Uber with lots of VC money pouring
in. This is not unlike selling shovels during gold rush.

------
thwarted
This is a decent writeup because it defines what "an uber" is and what it
means to be a business like that.

How many "Uber for X" businesses label themselves that way because of
interactions like this one, where customers and investors are so focused on
Uber as some kind of canonical startup that there's attempts to squeeze
unrelated business models into it?

[https://www.youtube.com/watch?v=syoqjYLDs48#t=19m31](https://www.youtube.com/watch?v=syoqjYLDs48#t=19m31)
(specifically 21m56s and 24m9s)

This video is four years old, so it's good to know that claims of "Uber of X"
are getting long in the tooth. It'll help to start agreeing on definitions and
get away from the buzzwords.

------
tedsanders
This article is excellent.

It takes a common idea (Uber for X), puts it through a simple but appropriate
2x2 lens (skill & scheduling), and produces a valuable insight with broad
applicability (most markets are not like taxis).

Thanks to Sam Madden for writing it and to you for sharing it.

------
smacktoward
The fascinating thing about this writeup is that it's even necessary.

The analysis it presents is a pretty straightforward one. It's the kind of
basic contemplation of product-market fit I'd expect anyone starting a new
business to undertake before spending a significant amount of time or money on
it. In other words, it's a simple sanity check.

What makes this one fascinating is that apparently so many people out there
have tried to start "Uber-for-X" businesses _without even doing a simple
sanity check first_ that it's necessary for a third party to do it just to
prevent even more lemmings from marching off the cliff.

------
Grustaf
>Technology cannot necessarily miraculously make the pro more skilled at their
job

Well, in the case of Uber that's exactly what it did. Uber wouldn't be
possible at all without consumer GPS routing apps, that's one of the reasons
(at least ostensibly) for regulating taxis. Cf The Knowledge, London taxi
drivers' training that is so extensive it actually can be detected on a brain
scan.

[https://en.wikipedia.org/wiki/Taxicabs_of_the_United_Kingdom...](https://en.wikipedia.org/wiki/Taxicabs_of_the_United_Kingdom#The_Knowledge)

------
Triiistan
"It worked great for local transportation services, so why could it not be
applicable across all types of industries?"

Dit it really work that great for Uber? Are the drivers doing all right? Did
the company make the world progress? Is it even profitable? Are the clients
happy about Uber's service? These are important questions to consider before
trying to replicate their model, and I'm pretty sure not everybody feel the
same way about this success.

------
jkingsbery
"It is rare that one plans their day around transportation" \- it wasn't the
main point of the article, but that's not my experience. Many of the people I
know who, like me, commute into New York from the suburbs plan their day
around the train (when is the express train, when is the last train that runs
every 30 minutes instead of 60 minutes, and so on).

------
throwaway100z
Apologies for an unrelated question but, what is the formal name of this chart
indicated in the blog? Scatter plot?

[https://blog.ycombinator.com/wp-
content/uploads/2017/08/Befo...](https://blog.ycombinator.com/wp-
content/uploads/2017/08/Before-You-Build-Uber-For-X-Chart-1024x731.png)

~~~
thedirt0115
Yeah, it's a 2d scatter plot.

------
capocannoniere
Submitted this article as I'm curious about what the HN community has to say.
Apologies if this is a re-post

~~~
grzm
You can use the search form in the footer to determine whether a post has been
submitted before. In this case, it was submitted two weeks ago, though it
garnered very little attention.

[https://news.ycombinator.com/item?id=15042817](https://news.ycombinator.com/item?id=15042817)

In general, it is good to check to confirm whether it's a dupe. In the case of
submissions that haven't had much discussion, it's okay to resubmit.

------
mindhash
I think urgency should be driven by lead time (when i want it - when i get
it).. for e.g. Getting a web design guy may take you upto 3 weeks or more or
45 days if you hire but if you get the same guy in a week or less then the
model still works.

Comparing Web design urgency with taxi doesnt make sense.

------
cossatot
What is an example of an on-demand, app-mediated service that is actually
profitable, regardless of whether labor is contract, etc.? Is any one in this
space actually making money off customers?

------
zengid
Minor side-note, but I think that 'skill vs urgency' graph underestimates the
skills required for delivery service providers. Source: I work for UPS.

~~~
teej
I assumed delivery in this case meant local delivery like food.

------
jonny_eh
Web design is less skilled than life coaching?

~~~
wrs
And dog training.

------
michaelmior
> It is rare that one plans their day around transportation

I do this pretty regularly as do many people who rely on public transit.

------
odammit
I only build the Netflix of Ubers.

I seriously hate these phrases. It's OK to use adjectives, nouns, verbs and to
say the word "app".

I was talking to a guy at SBYP once that said he was building "the Netflix of
snacks" and I asked the guy how he planned to digitize said snacks and he
looked at me like I was the asshole.

I get it but use some words to describe your thing, man.

------
ap46
Way to demotivate other startups!

~~~
jeddawson
I've actually been working on something that this article applies to and it
was refreshing to step out of my comfort zone and reanalyze how things might
work out with a fresh perspective. I found it helpful to think through the new
challenges that were created by the change in viewpoint and I feel reassured
that I have solutions ready.

------
wellboy
Insightful article, but a bit hard to distill the distinct points. From my own
experience at an Uber for X, there is one overarching theme that dictates the
whole dynamic that I think isn't addressed. The article makes the following
points.

1\. "The more skilled the service, the harder is to gain traction, because
quality in service isn't reliable." This is true to some extent, but there is
a bigger underlying dynamic, namely that the fewer people can offer that
service, the harder it is to gain traction, because it takes longer to get
that service on demand (e.g. 20 mins instead of 1 min), which decreases the
user experience.

2\. "There are services that require more time for for scheduling and some
require less." The article doesn't really say which one is better, but the
latter is better, because it makes it more spontaneous, people can make the
decision to demand the service easier and do it more often.

3\. "Maximizing conversion through services where no sales pitch is required,
because quality is almost always the same (taxi)." This goes back into point
1, where low skill all have the same quality. It adds the factor that when
quality is the same, people are less picky and make more purchases.

4." Maximizing profits through retention to get repeat customers." I didn't
understand this point, since critique for Uber for X is that repeat customers
would bypass Uber for X, in order to avoid fees, such as it happened with
Homejoy, Plumbers etc. This can be prevented through making ratings valuable,
i.e. giving pros incentives to not bypass the platform.

The overarching themse is critical mass. All of the mentioned points explain
what factors prevent critical mass form being accomplished. Summing up these
are

1\. The more skill you need, the less service providers you can get per square
mile, the longer it takes to fulfill a service, the harder this makes it to
get traction.

2\. The shorter it takes to schedule the service, the more people will make
the decision and book the service.

3\. The less the quality is a factor, the less people will worry about making
the purchase.

4\. Repeat customers is where the money is. Make it easy for the consumer and
pro to maintain these relationships, BUT, keep them on the platform.

5\. This point I add myself, it is locality and it is the most important
point. It means that you have to figure out a way to get traction in a new
city in a scalable way, because you can get traction in SF with masseurs and
clients, but you need to do it all over again in Fresno, Seattle, London, etc.
There is some traction that comes from other cities, but it is little. For
some services, traction in a handful city is enough and you cna be a $100m
company, but for most, you need to be able to get traction in several dozens
of cities quickly.

------
grabcocque
Uber's main success was to take something that already existed (taxi services)
but then found a way to work around local labour laws on a technicality.

Because Uber drivers are all self-employed, they're not unionised or protected
in any way. Thus, Uber pays its drivers a pittance, and is able to undercut
and undermine existing taxi services who are forced by unions and law to pay
drivers a living wage.

That's the key to being Uber for X. Ask: can I use the internet and shady
business practices to exploit workers to undercut a business that previously
workers were protected in?

If the answer is Yes, then you can be Uber for X.

~~~
WillPostForFood
The Taxi medallion system is more exploitative of labor than Uber, forcing
poor people to prepay for the right to work. It's as close to indentured
servitude as you can get.

~~~
rwmj
The medallion system seems to be a US peculiarity.

In the UK you have to also pay fees up front (and pass certain tests) but the
fees are relatively modest[1] and the tests include things like knowledge,
medical fitness and criminal records, which all seems reasonable. This legally
applies to Uber drivers too, although whether it is enforced seems to be in
doubt[2].

(I'm not talking about London black cabs which operate on a slightly different
system)

[1] The fees for my local council are in section 10 here:
[http://www.dacorum.gov.uk/docs/default-source/licensing-
docu...](http://www.dacorum.gov.uk/docs/default-source/licensing-
documents/licensing-fees-and-charges-2016-17-\(pdf-418kb\).pdf?sfvrsn=17)

[2] [https://www.standard.co.uk/news/transport/uber-may-
face-21m-...](https://www.standard.co.uk/news/transport/uber-may-
face-21m-minicab-licence-fee-a3518996.html)

~~~
dmurray
> The medallion system seems to be a US peculiarity

The equivalent system existed in Ireland until 2000, with taxi licenses
changing hands for over $100,000. I'd be surprised if this doesn't persist in
other European countries and cities.

~~~
Kankuro
In France, licenses have been given for free in limited numbers, and with the
right to resell them on the market. So their price have increased up to
200-350k€. So some people made a lot of money there (and they one accept cash,
so you know what can happen with the taxes). Recent buyers are in a bad
position because they get it for a high price and now risk their value to drop
because of the recent competition.

------
undoware
X11 is getting a rideshare service?

 _Sigh_ well I guess it has modules for everything else

~~~
mikeash
Getting remote display working can be a major pain. An app which handles the
work of bringing together your X server and a remote client could really be
valuable!

