Quote:
Originally Posted by Tyga11
They collect revenue from every ride and the Uber drivers are not employees so they don't have any overhead there.
How are they not printing money? What is the overhead besides the software? Never understood this
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For all these ride sharing apps, cost of customer acquisition is extremely high. Uber has basically been commodititized by its competitors. Customers typically have multiple apps installed and will use whichever is cheaper at the moment in time. All these promos/discounts/offers are funded by Uber and that's where the cash burn is.
In my part of the world, Uber fought and lost to Grab, a regional startup here. They sold their stake to Grab few years back, but even Grab is not profitable til today despite being the major ride share player in the region.
Compounding to that problem, easy money is drying up. Starting Q2 this year, VCs wised up and stopped looking for potential and started looking for profitability. So all these companies that were riding their unicorn status are getting a lot less funding now.