Uber is a privately-owned company headquartered in San Francisco, CA. It was established in 2009 under the name ‘UberCab’ by Garrett Camp and Travis Kalanick, and it is one of the first successful transportation startups to grace the modern world.
This enterprise is probably most known for its mobile app which lets people hail a ride and pay for it in mere seconds. Simple, efficient and classy.
On top of its transportation service, Uber offers other kinds of transit for customers: food deliveries, service that works in conjunction with the taxi industry, transportation via boats, freight delivering service and other kinds of assistance.
That’s the basic gist of it. Find out what this business is all about with this rundown of materials.
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The profitability of Uber is of major interest since it’s a privately-owned business and it is not required to disclose financial data. However, a few figures were released and shed light onto the financial state.
Even though gross bookings reached the number of $20 billion, and net revenue was at $6.5 billion, the company still reported annual losses of $2.8 billion. It’s not hard to triangulate the reason, these deep losses are the consequence of what may be called as a ‘timeline of turmoil.’ More on that later.
From a financial standpoint, in order to become profitable, the company needs to begin cutting losses. The company still has a long way to go before becoming a profit-turning enterprise instead of revenue-generating one. Not everything is as grim as it sounds, the business has enough money to fuel its efforts for two or three more years.
The service provides a variety of options for any discerning customer. There is a tiered system that allows for customers to pick the type of vehicle they want; this flexibility elevates it far and beyond over a traditional taxi or shuttle service.
Since Uber is also available round the clock, it makes for a great way to get around town, no matter the time of day.
Proprietary referral program and celebrity stunts can also be attributed with bringing moderate marketing success.
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Structure ; Operations
It’s hard to estimate the number of employees since it does not operate on a full-time basis with its partners. However, it is known that the company functions on a global scale, with a vast number of cities (over 620, in fact) supported by the app. Drivers are to bring their own transportation, which in turn eliminates overhead and overall costs by a large margin.
As mentioned earlier, Uber is one of the few private companies that suffer losses in revenue. So what went wrong?
There are significant problems the company is yet to fix. There’s the legal mess with WayMo, a lawsuit has been filed by Google’s parent company – Alphabet – over the alleged theft of intellectual property. Work culture and harassment lawsuits have also been filed, and top-level executives began to leave the company.
The enterprise needs to make the service work the drivers (they earn minimum wage, no benefits) and even employees. The only ones winning out of this are the people who use Uber as a mode of transportation – the rates are quite accommodating.
More on Uber below.