A unicorn is a startup that crosses the hallowed $1bn valuation mark. But it’s when it takes the world outside the tech industry by storm that it can be considered revolutionary, paradigm shifting, world changing. Check Google, Facebook, Amazon and Twitter.
Now add Uber to that list.
But here’s the kicker. Uber may actually end up bigger than Google, Facebook, Amazon and Twitter…combined.
- Its rate of growth for a real-world-atoms-moving company is quicker than Google, Facebook, Amazon and Twitter. In fact, pure tech companies can find scaling-up quite a bit easier than companies that deal with real world assets, like Amazon and Uber. And even in such odds, Uber has far outpaced the others.
- It has chosen to up-end one of the most essential industries – transport. After food and shelter, this has to be the next most basic human need, and Uber is pretty much the only global household name. That too, in just 6 years after being founded. A lot of that is because of the essential nature of the industry they are in.
- The CEO, Travis Kalanick, may be a chauvinistic pig, but his professional instincts and drive so far have been incredibly aggressive and spot-on. He has mitigated a large number of political risks and regulatory hurdles by hiring David Plouffe (who handled the Obama campaign). And this time, he’s probably handling the biggest campaign of his life. Local disputes like the taxi strikes in Paris and the rape controversy in India need to be handled carefully and sensitively, something Travis is least suited for. But Plouffe, on the other hand, can manage global PR, local governments and aggressive lawsuits smoother than almost anyone on the planet. A huge trump card for the company.
- Their modus operandi. Uber treats each city as a mini-startup with much of the decentralised authority and mentality it entails, enabling multiple simultaneous localised experiments, the learnings of which can then be easily and quickly scaled across their global network. This has a two-fold benefit: firstly of easier penetration into local markets (instead of shoe-horning a standardised system in drastically different markets), and secondly of quick and dirty trial-and-errors at smaller than system-wide scales, which can then be fine-tuned for the system if they show promise.
It’s the last point that gives Uber the versatility and agility to grow as a startup even at their currently incredible scale of 67 countries! They’ve been experimenting with all sorts of ideas, some wacky and some obvious in retrospect, which gives us an idea of what they’re imagining the future to be.
The biggest paradigm shifting experiment is their investment in developing driverless autonomous cars. This would firstly eliminate the need for drivers and their salaries and insurances, thus massively reducing the operating cost of a vehicle by more than 50%, and secondly make the vehicle available for all 24 hours, reducing downtime to a mere 2% for scheduled maintenance and upkeep. What this means is that you’ll be paying a small fraction of the cost per km that you currently do, for a much more responsive and consistently available system of cars.
It’s not too far-fetched to imagine not just Uber cars, but a fleet of Uber trucks, someday maybe even Uber planes! (With our identities being fingerprinted on phones, a lot of barriers can be cleared.)
Here’s a small list of what they’ve tried: UberRUSH (merchant deliveries), UberPOOL (carpooling), UberEATS & UberFRESH (food deliveries), UberHEALTH (checkups and vaccines), UberCARGO (moving service), in-car magazines (great for ad-revenue).
If only some these experiments pay off, Uber can be a viable solution for a multitude of industries.
- Taxis (Duh!)
- Carpool – an obvious extension
- Buses – Bit of a stretch, but it’s just a regulatory leap away
- Deliveries – They’ve tried ice-cream deliveries in a few cities, groceries in others. With a well entrenched fleet, it’d be easy to handle on-demand delivery services in a city.
- Healthcare & First-Aid – A simple kit is easy to carry around, and doctors in designated vehicles improve access like nothing else
Put simply, Uber wants to do 2 basic things
- Transporting people
- Transporting goods and services
But what’s also interesting is the probable path they plan to take to get there. Clearly in the short term, they’re looking to kill the current day version of taxis. We’re seeing this happen with our own eyes, no big surprise there.
It’s the medium term goal that’s more intriguing – remove ownership and drivers. In Kalanick’s own words:
“The magic of self-driving vehicles is that the reason Uber could be expensive is because you’re not just paying for the car, you’re paying for the other dude in the car. When there’s no other dude in the car, the cost of taking an Uber anywhere becomes cheaper than owning a vehicle. Even if you want to go on a road trip, it would just be cheaper. The magic there is that you bring the cost down below the cost of ownership, for everybody, and then car ownership goes away.”
What are the ramifications of something like that?
- No one ever has to own a car. But what about other things?
- Deliveries – Uber can rival Amazon’s drones for its own low cost delivery services. What’s the cost when you can just stuff goods in the trunk of a car that’s already carrying passengers on the same route?
- Rented goods – Why buy something you’ll use rarely, when you can just rent it for a fraction of the cost. Uber drops it and picks it up once you’re done.
- Motels – Far-fetched but we’re speculating here. With no drivers, the concept of a vehicle can change from our current car to something far more box-like. A box (caravan-like) where you could sleep, shower, eat and relax overnight while you work in the day. Especially useful on long trips. And if you can do it on trips, there’ll be some who can do that permanently as well. Cueing a whole new concept of residence and home-ownership.
While the last one is too wildly imaginative to be considered, for everything else, there’s Uber. And the best part is, transport & logistics isn’t a want, it’s a need.
If they play their cards right, there’s no limit to what’s possible in the long term. Now that’s a little scary.