
Disrupting Uber/Lyft? - permatech
Recently the number of Lyft drivers on the road at ~5AM has gone down in my area substantially. Recently I met a driver that starts taken people &quot;off the books&quot; at 3AM and then drives on the app until 6 or 7AM. He suggested someone replicate the app, invite all 5 start Lyft &#x2F; Uber drivers to join and offer riders the first ride free. Run the entire thing with a low overhead with profits going to the driver. Seems like an interesting way to improve the community.
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lhorie
The problem with asking a Uber driver how to make a better Uber is he'll
always tell you that the solution is to decrease overheads so he can earn
more, when in reality the competition between Uber/Lyft already pushes margins
to be thin. Also worth noting that a significant portion of these "overheads"
go towards hidden support jobs that let drivers focus on driving in the first
place (e.g. new driver onboarding, customer support, fraud detection,
marketing, dev ops, etc).

~~~
permatech
When drivers are already driving for Lyft and Uber the on-boarding is taken
care of.

Uber and Lyft are pushing margins down because they want to extract profit to
pass back to shareholders. When revenue only goes to supporting the
infrastructure and paying riders the only competition is who can deliver the
cheaper ride. Delivering the cheaper ride for Uber/Lyft while also generating
a profit means the driver needs to take a hit. Why would the driver take a hit
when he can drive on a platform that pays better?

~~~
lhorie
Every company has to take care of its own onboarding, so sure it's taken care
of... for Uber and Lyft. But not for a new competing service. A new competitor
has to figure the local regulations etc for every city they operate on, setup
driver intake centers, man these offices, etc. New cities also typically
suffer from rampant fraud and anti-competitive practices (e.g. subsidizing
rides via VC money). Dealing with this stuff isn't cheap either.

> Uber and Lyft are pushing margins down because they want to extract profit
> to pass back to shareholders.

Profit comes from within those margins, so pushing it down (as in a race to
the bottom) is at odds w/ shareholder yield. Also uber/lyft stocks don't yield
in the first place (they haven't even had a single profitable quarter in the
open markets yet...) In fact Uber/Lyft IPO stories have largely been told in
terms of growth and market share.

> Delivering the cheaper ride for Uber/Lyft while also generating a profit
> means the driver needs to take a hit.

You can't really have your cake and eat it too. If you're delivering a cheaper
price, then by definition driver pay goes down too. Uber can increase margins
via economies of scale (e.g. the same call center can support US, Australia
and India, price shopping for insurance on a per-month basis actually makes a
difference, etc). The whole game is actually about getting as much market
share possible to increase the total margin through sheer scale.

Having seen a financial breakdown of costs per ride, I can tell you that you
are severely overestimating what percentage of a ride's money goes to things
other than driver pay. The vast majority does indeed go to the driver already,
and the rest gets extremely complicated on a city-by-city basis due to intense
local competition, regulations, and a million other factors.

Overall, it really just sounds like you are armchair-postulating without any
grasp whatsoever on the industry...

~~~
permatech
> Overall, it really just sounds like you are armchair-postulating without any
> grasp whatsoever on the industry...

No, I was proposing a employee owned version of Lyft. For onboarding screen
you use something like "already has 100+ drives with 5+ star rating" or
similar.

> You can't really have your cake and eat it too.

True. Rather than paying shareholders and drivers an employee owned company
only pays the driver. They are recruiting from the same pool of drivers.

~~~
lhorie
Onboarding often requires things like criminal background checks, medical
exams, city-issued permits, driver license validation, training, etc. You
can't just show your Uber driver profile screen to Lyft to qualify as a driver
for Lyft. You're in for a world of trouble if your onboarding flow is: "oh, I
see you drove for Lyft for ~2 weeks, welcome to being one of the company
owners, here are some health benefits!"

> Rather than paying shareholders

I just told you Uber/Lyft shareholders get zero dollars out of the operational
money.

------
thedevindevops
Have you looked at:

[https://www.ridesharingdriver.com/lyft-driver-
requirements-m...](https://www.ridesharingdriver.com/lyft-driver-requirements-
meaning/)

Try replicating __that __on a wafer-thin margin _on top_ of the development
and maintenance of the tech infrastructure.

~~~
permatech
Lyft/uber need to pay drivers and make a profit -- if a rideshare is
employee/driver owned the profit is the same as the drive pay out. Margins can
stay the same but how could lyft/uber keep drivers and make profit for
shareholders?

