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The Economics of Uber

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First 500 people get 2 months free of Skillshare: http://skl.sh/polymatter7 Patreon: https://patreon.com/polymatter Twitter: https://twitter.com/polymatters Reddit: https://reddit.com/r/PolyMatter Discord: https://discord.gg/polymatter Uber may be the highest-valued private company in the world, but its economic troubles are profound and concerning. This includes a paid sponsored promotion which had no part in the writing, editing, or production of the rest of the video. Music by Varsity Star: https://varsitystar.bandcamp.com/releases their Facebook: https://www.facebook.com/varsitystarmusic/ Special thanks to http://ridester.com for looking over the script in advance. Ridester offers resources for ride share drivers. Brief music clip: Teddy Bear Waltz Kevin MacLeod (incompetech.com) Licensed under Creative Commons: By Attribution 3.0 License http://creativecommons.org/licenses/by/3.0/ VHS fast forward effect modified from https://www.youtube.com/watch?v=s_auAhu-91U https://www.forbes.com/sites/lensherman/2017/12/14/why-cant-uber-make-money/#7d83f5f410ec Dr Seuss Style Font: “Yikes” by Rick Montgomery https://www.dafont.com/yikes.font?l[]=10&l[]=1 http://flopstarter.com https://medium.com/enrique-dans/why-is-uber-sweeping-all-before-it-because-it-understands-economies-of-scale-70d104688783 https://www.irs.gov/businesses/small-businesses-self-employed/independent-contractor-self-employed-or-employee http://ritholtz.com/2018/05/tlc-medallion-owners-created-uber/ https://www.caseyresearch.com/forget-stocks-buy-taxi-medallions/ https://www.nytimes.com/2017/09/10/nyregion/new-york-taxi-medallions-uber.html http://www.nyc.gov/html/media/totweb/taxioftomorrow_history_regulationandprosperity.html https://www.nytimes.com/1996/05/11/nyregion/medallion-limits-stem-from-the-30-s.html https://www.theverge.com/2018/6/26/17500510/uber-london-license-appeal-court-decision?utm_campaign=theverge&utm_content=chorus&utm_medium=social&utm_source=twitter https://www.statista.com/statistics/277229/facebooks-annual-revenue-and-net-income/ https://www.washingtonpost.com/news/the-switch/wp/2016/06/27/how-much-uber-drivers-actually-make-per-hour/?utm_term=.cc5e13967aec https://www.cbinsights.com/research-unicorn-companies https://expandedramblings.com/index.php/uber-statistics/ https://medium.com/uber-under-the-hood/uber-in-small-towns-and-cities-a-data-deep-dive-6e3cc2a250f4 https://www.wsj.com/articles/how-self-driving-cars-could-end-uber-1494154805 https://www.wsj.com/articles/with-kalanick-out-ubers-troubles-are-just-beginning-1498049054 https://www.wsj.com/articles/with-kalanick-out-ubers-troubles-are-just-beginning-1498049054 https://www.statista.com/chart/12059/uber-revenue-bookings-and-net-loss/ https://www.theguardian.com/technology/2018/mar/01/uber-lyft-driver-wages-median-report https://www.ridesharingdriver.com/uber-fees-cancellation-booking-cleaning-fees/
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Text Comments (1263)
PolyMatter (6 months ago)
New logo + we’re getting the reddit.com/r/PolyMatter subreddit going!
Pratik Raj Pant (2 months ago)
P
Nova LiThePear (3 months ago)
China has a uber like thing. Ive been in china to visit my relatives about 5 months ago.
Darth Awar (6 months ago)
Uber stole all their self-driving car technology from the Waymo Company the Alphabet/Google Self-Driving Car Company (Over 2,000 pages of Documents not just diagrams and lists of parts but programing code as well!), They also have the whole legal backlash over their test self-driving car killing the girl earlier this year! Google/Waymo and Tesla will be the real giants to push self driving cars forward, Lyft & GM are said to be working with Waymo to get the cars out first while being faster (via cloud sharing traffic data and routes!) while being much safer than Uber's, Uber is rumored to be working with Ford to make these cars when they get the technology right but seeing they are in legal battles with Google forcing Uber to waste time and money in court while also stopping them from using the stolen tech until the matter can be resolved forcing Uber to waste more money in creating their own version of the stolen Google/Waymo hardware & software which cost them money yes but arguable more important time giving companies (like Waymo, GM, Tesla!) a huge market share before Uber can even get theirs out the door! Tesla & Waymo have stated they have no plans to work with Uber or even allow them to purchase their cars or tech despite the amount as Uber is already so large and greedy that if they helped Uber it would be like letting your kids feed a wild bear Not a Good Idea!
Jonathan Bryant (6 months ago)
3:43 for you and me**
Traveel (6 hours ago)
1:45 CGP Grey robot in the 1st gear on the left!
CHACE (1 day ago)
Jeez it's really all or nothing with Uber. I don't really believe in the companies business model long term.
Tommy Vercetti (1 day ago)
When a re they considering going electric?
I’m from Gridley thx for the shout out this is crazy!!!!!
Ms Garamycin (2 days ago)
i don't think Kim will be good facebook friend
MrCookieDoodles (3 days ago)
so uber could easily invest in the space industry?
jayive34 (5 days ago)
7 times the normal price!? The most I got was 2.9!
Dustin Ducote (5 days ago)
wow.... you read off a script really well!! making even the random add-ons sound organic!!!! stressing 'happened' though? cheap.
John Smith (6 days ago)
"Uber is the highest valued private company in the world, more then Airbnb, Space X, and Lyft combined." Wow.
David Rosner (7 days ago)
As a former part time Uber driver, I’m fascinated by the company’s business philosophy as well as their rapid growth over the past decade. I agree with this video’s analysis that the future of Uber is with self-driving or possibly self-flying drone taxis. Uber will need to successfully adopt autonomous driving technology and compete with the likes of Google and Volkswagen to survive. If Uber makes transition to autonomous driving technology, it will become a major transportation company rather than a ride sharing platform. They have a lot going for them and I wish them luck but only time will tell if Uber will succeed medium to long term.
Md Aman Mazhar (9 days ago)
Also make a pdf having the information mentioned in the video
Katea Jurors (13 days ago)
Do not get a GM vehicle do not trust a GM vehicle. For the past 20 or so years they've been making them shit. And now they're pulling out of the United States I will not trust a self-driving GM vehicle if they get a deal with Honda or Toyota that I'm definitely more willing.
Martin Johnsons (13 days ago)
it wasn't great, but it was depressing hm.. fair enough
TechReflex (14 days ago)
2:20 Okay. :-|
Tycooperaow (15 days ago)
If you add blockchain platform by creating a new app entirely, drivers will earn so much more and it cuts the middleman entirely because everything will be through a dApp and smart contract.
Uber is pointing to EBITDA as the earnings, not factoring in the cost of capital expenditures, this has been done many times before.
Abu Quabir (16 days ago)
Is it me or was there a Kim Jung Un and Steve Jobs reference at 7:42
Michael Laymon (17 days ago)
now TikTok is the highest valued startup...
Cecil Gordon (17 days ago)
uber is the ultimate dude-bro scam. they carry none of the actual costs of business and take the lions share of the cut. granted, they cover marketing but NO business expenses and carry no business costs, ie ... workers comp, unemployment insurance, employer FICA, Medicaide matching contributions. thts not clever, its a con-man/slavemaster mentality. and the idea that the company is worth billions when its never turned a penny in profit (because of excessive executive pay) is unbelievable.
Rödët Bürk (17 days ago)
Uber customer support sucks
You are not even an economist but you defy Uber investors by saying Uber's business model is not sustainable. Id say thays rather bold
Robert Harris (18 days ago)
Fuk uber
Maxx Reverie (18 days ago)
Thank GOD for Uber, many times taxis said they would come for me, and never showed up. Uber ALWAYS show up, yay!
Desmond Bagley (24 days ago)
.......look at the track record of Uber.... clearly it is a criminal organisation..Those who sing praise to Uber are the trash of their societies being only interested in selfishly saving a measly buck.
Hair Luvo (25 days ago)
Uber is not the highest valued private company in the world. Not even close.
Thundawich (25 days ago)
What was Uber spending tens of millions of dollars daily doing? I thought you said they had no risk and were essentially just skimming profits off the top of the drivers. You mention a lack of service/consumers, but essentially they run an app and rent/own some servers. What is costing them so much? ;-;
Mike Papadopoulos (26 days ago)
An investment endorsement in the middle of the video?? Seriously???
Mike Papadopoulos (26 days ago)
Sarcasm is the lowest form of wit.
Mr. Sarvy (29 days ago)
in uk now,you need licence for passanger transport and extra inshurance,so no,you cant do it beween jobs because you still pay the extra inshurance and not using it
Alan Karcich (30 days ago)
this is very true of instacart as well
ttraderjim (1 month ago)
$8.55 per hour after expenses works for me. It’s a very pleasant way to spend the day. (I’m retired from a 30 year pressure job). I drive my own car and usually have enjoyable conversations with my customers. If I needed more than $8.55 per hour I would bust my brain figuring out how to get it. Uber operates on supply and demand and I don’t think complaining about wanting more money will work. “Don’t get mad, don’t get even, get ahead”
The Black Ghost (1 month ago)
Fantastic, a youtUBER that makes good videos!
hosank (1 month ago)
Wow, Flopstarter actually exists
Sedric Suringa (1 month ago)
What's the font used in this video???
okko16 (1 month ago)
This is a comercial for Uber.
Mani Fernandez (1 month ago)
Uber is not a sustainable buisness.the riders are expendable and WILL be once investors' sell their shares when the company corruptly goes public.They have data to sell and thats about it.... thing is rides can be so random their stats are like a dog poo.....does make me chuckle how so many ididots have fell for the biggest scam on earth lol
Mark Pantoja (1 month ago)
Race to the bottom and stop giving rides to this retards that dont appreciate you and you service.. oh and report u
Raheem (1 month ago)
amira25930ue uber code
haks Hinds (1 month ago)
Logo is cold
Jose Herrera (1 month ago)
Whenever I see an idiot driving recklessly, I already know that uber sticker is on their back window.
Cookies Yum (1 month ago)
Did you see CGPGray's robot? I love when youtubers do this.
Tanmoy Dixit (1 month ago)
Very informative... Great video 👍👍👍
saavy p (1 month ago)
But then YouTube wasn't invented, so they drove taxis 😂😂 ded
KuraIthys (1 month ago)
Driving a taxi certainly wasn't so great either. Granted, it's a different country, and somewhat different conditions apply... But I witnessed a lot of taxi drivers getting very low wages that functionally are below minimum wage by quite a margin. When you're making $250 for a 12 hour shift on a GOOD day, Oh, but you have to pay for half the fuel cost... And half of your money goes to whoever owns the taxi... (Taxi licenses being quite expensive, as per the example), Still, you may nonetheless pocket that $250 Fine, sure. But that's only on a GOOD day. Only if it's busy. And only if you get lucky, hang out in the right places, and try to ensure you get lots of short trips, rather than a few long ones. (and that nobody sends you out into the middle of nowhere forcing you to drive back to a more sensible location with little chance of a fare along the way.). On a bad day... Count on getting $70 And if you do this 7 days a week... Count on your total weekly wage to be somewhere around $800 at most. OK, fine. Sure. But you've just worked 7x12 hours to earn $800. That's 84 hours, to earn $800 - let's round that up for the hell of it. You earn $10 an hour. So, what's the problem here? Well, you live in a country where the official, legally mandated minimum wage is about $21 an hour. (And quite a bit higher for people that work nights or on saturday or sunday evening especially -and you HAVE to work these periods to stand any chance of making that $800 - your busiest times are friday and saturday night.) So, through some peculiar legal oversight, you earn about half of minimum wage (if you're lucky), and are at risk of being assaulted or robbed or otherwise messed with on a regular basis (and the risks of this are highest at the same periods when you're most likely to make money, thus difficult to avoid), the police have it in for you (they'll fine you for the slightest thing at a rate vastly higher than a normal driver)... Quite the job, huh.
James Cochrane (1 month ago)
If they go to driverless cars, then won’t they just become a taxi service and subject to regulation? Without the “partners” won’t be able to argue just a platform any more!
db11289 (1 month ago)
The low prices would have obviously led to drivers exiting. The worst thing to do was to reward drivers throwing tantrums by making limiting the supply artificially with government force. In both cases, you get less drivers. In the later however, the supply is now artificially set rather than a function of market forces.
Blue Electrical (1 month ago)
It's my birthday today! Please give me a present by subscribing to me! Thank you so much and have a great day!
john westermark (1 month ago)
Uber left China because they got the boot after setting up.
Jumbo Cor (1 month ago)
at 2:23 it’s not monopoly it’s perfect competition meaning prices are lower than an oligopoly that happened with the medallion system
Mr Peco (1 month ago)
you should do a vid on the stock market @8:45 and how it works
Hi Mr. Peco, I just finished a video on how the stock market works from an investors point of view, you may find it interesting!
Deno Moto (1 month ago)
Uber is trash. I tried it and it was such a bad experience that I actually stopped using it as a customer because I cant in good conscience
xiral (1 month ago)
Whatever you say... Taxi drivers were ripping off the riders..
Justin Mahida (1 month ago)
5:28 Does North Korea really have service by Uber? I find that difficult to believe.
Would have liked to hear your opinion on the tipping feature.
selectsedan (1 month ago)
Sir, Mr. Tony West Chief Legal Officer Will you consider adding to Uber's Drivers/Riders Support Staff in order to improve response time for everyone? Days-to-weeks at a time of "time out" or deactivation of us Drivers & Riders by your Algorithm, and no one is there to override it. Keep in mind that higher-end vehicles and commercial insurance is a large investment. Once a Driver or a Rider has filed a request for fact-finding (Discovery) with the UBER Registered Agent of their state, do they still have to appear in person in The Netherlands? Bibi Pravong UBER Black/SUV Driver Dallas, Texas 214-223-3338 LinkedIn
WilsonBlock100 Radio (1 month ago)
Just stop hazarding in tha middle of tha street
pyrobooby smith (1 month ago)
https://petitions.ourcommons.ca/en/Petition/Details?Petition=e-1906
Andrés Feliciano (1 month ago)
I don’t think i’ve ever laughed as much as i’ve learned in a video before. Well done 👏🏼👏🏼
james le (1 month ago)
Not convenient but stealing from drivers value of car
Thiago Oliveira (1 month ago)
We need to do something to combat hunger and the basic survival needs of humans around the world in some simple and intelligent way as well. No humanity, no money!
ashish gaur (2 months ago)
self driving cars maybe plausible in developed countries but introducing self driving cars in developing is very difficult. And uber cannot use fail fast strategy here to get an advantage since human lives are at stake now.
DYZ.G Comment (2 months ago)
1:45 CGP Grey's bot is here!
Simon Xyz (2 months ago)
Feel sorry for Uber drivers!
DIp (2 months ago)
I want Uber rocket so I can go to Mars to hunt down some aliens
Edgar Cristaldo (2 months ago)
This company is a scam. They came up with a new system (Uber 180 days) to get $50 off every driver everytime they get a moody rider who decides to give them 1 star. Out of 434 rides, I have 413 rides 5 stars. 15 are 1 star. (The rest is 4 and 3 stars) Those were people who threw up in my car, damaged it, people who wanted to smoke inside the vehicle, was aggressive and so on. My account was deactivated because my rating fell below 4.70 Now they want me to pay $50 to reactivate it with no promises of future deactivations.
Josh Webbs (2 months ago)
Basically Uber is preparing all of there customer to ride in self driving cars they are losing money to gain a customer base. Then they will cut the driver and start making profit when self driving cars be widely available... Clever devil
uber froud (2 months ago)
But uber partner income 👎👎👎👎👎👎
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Tom Federico (2 months ago)
Do not work for these app based jobs, we are telling these rich corporations that we like working for minimum wage or less, for no benefits, while devaluing your only asset....Does that sound good to you? Uber, uber eats, grubhub, doordash, they are getting rich, they recently lowered pay, and increased fees...That's when they became even more valuable...But i guess we love it, nobody is complaining....The rich like us stupid.....We are all just suckers working for the rich.....
Kaka karrot Cake (2 months ago)
It’s shitty working for this company I would never wish it on anyone there is no hourly
Kaka karrot Cake (2 months ago)
Uber working for them is shitty
csxcobra csxcobra (2 months ago)
ALL DRIVERS DO THIS..........TURN DOWN 5 RIDES PER WEEK. TELL THE CUSTOMER BECAUSE OF THE RATE DECREASE IN OUR PAY THIS RIDE NO LONGER PAYS ME ENGULF AND FOR THAT REASON I WILL NOT TAKE YOU. PLEASE GET OUT OF MY CAR AND CALL UBER LYFT AND TELL THEM TO PAY THE DRIVERS BETTER SO I CAN GET A RIDE. PASS THIS ON AND THE RATES WILL GO UP. YOU ARE NOT REQUIRED TO TAKE ANY RIDE.
Leo A (2 months ago)
Uber will die soon.
cycling life (2 months ago)
Dont drive for these companys. I know alot of you probably hate a warehouse job buy but, reality is, you end up breaking your car and be unamployed in a short mater of time. They dont pay enough to cover a new transmission engine overhaul and other work related wear and tear.
Prince Majithiya (2 months ago)
Your videos are really good!
GMK OSU (2 months ago)
I love with this channel
Vaughn International (2 months ago)
First time here. The Sam I Am Bit made me subscribe...😂🤙🏽
Noah Franklin (2 months ago)
Your writing is impeccable, but your speaking is flat, somewhat apathetic sounding. In my opinion, if you worked on sounding more enthusiastic, it would do wonders on the overall quality of the video.
yakyakyak69 (2 months ago)
Fascist-Socialism: When business (taxies) use government (socialism) to use the force of regulation to kill the competition with "regulation".
Depot msa (2 months ago)
the video was great except that ad at the end, fuck ads !
william wallace (2 months ago)
Do a video on why Facebook's not doing so hot please.
Brennen Cox (2 months ago)
Uber didn't fail in China, per se, it was banned/kicked out.
Eiffel R (2 months ago)
Surge prices can be a b*tch, 2 years ago new years eve, I paid $30 for a 20 min ride to downtown Chicago. Around 2am tried to get the same ride back home the price jumped up to $170
Hey love your content 929 392 6266. I have a offer I think your going to love.
Ashutosh Kumar (2 months ago)
Which video editor do you use?
ankit chheda (2 months ago)
A windows phone.. nostalgia
Yin Scape (2 months ago)
5:22 "What are you doing scanning a QR Code in 2018?"
NJ (2 months ago)
It's expensive in India. Indian govt has a taxi meter system.
t4705mb6 (2 months ago)
Self driving cars? End of the road. https://www.youtube.com/watch?v=Ujk_5KD5G9o https://www.youtube.com/watch?v=g0TaYhjpOfo
Alex 2017 (2 months ago)
What is uber?
Ferricity AMV (2 months ago)
It does make sense. The more driver, the more competition while Uber are just gaining golds in this competition.. It has to be a well balanced equation
rejvaik (2 months ago)
Yeah people are wising up to the shit that is Uber and refusing to use it
RhysWilliams348 (2 months ago)
Uber is most definitely not the highest valued private company in the world.
lordfuture1 (2 months ago)
Prediction: Uber and Tesla or going to merge or form a partnership in the not-too-distant future mark my words. And if it's not those two companies, it'll be two companies from their respective Fields who recognize the weakness in their own business strategy and try to fill it with a merger. Uber wants in on driverless cars, Tesla is in a great position to help with that. Tesla would like to cover its butt by getting a piece of the transportation/ride-sharing economy. They can each take a large Leap Forward by plugging in the strength of each company into one really strong company.
Matthew James (3 months ago)
Love your videos! Can I please ask you how you get this reliable data? I would love to inform myself about topics like this from reliable sources!
Khodor Sheikh Moussa (3 months ago)
4:40 France flag
Lillian (3 months ago)
Lmao a lyft as came before this vidoe.
Luis Angel (3 months ago)
You should review the doordash model too
10000 subs no likes (3 months ago)
I live 1 town north of gridly

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