A Monday story from Reuters catches the eye. Investors don’t think a California ruling which classed a former Uber contractor as an employee will affect valuations, either for the taxi supplying start-up or others operating in the so-called “sharing economy”.
There are a couple of ways those optimistic investors might be right, but the sentiment suggests more about the nature of hope and dream-based valuations than any real consideration of business prospects.
We’ll get the obvious argument out the way first: the ruling was a one-off, which Uber will appeal, so lets assume companies which connect consumers with contractors who want to share their labour for a price can continue to treat those contractors as independent mini-corporations, not people. Read more
In Paris this week, at the Ouishare Fest, the great and the good from Europe’s sharing economy have been delving deep into what it means to be running a collaborative business model within a capitalist framework. Are the two even compatible? Or is there a fundamental conflict at the heart of an industry that preaches collaboration but, due to being radically commercialised by venture capital money from Silicon Valley, also needs to profiteer from the goodwill of others if it’s to remain viable?
For the most part it’s a hypocrisy the community is trying to address. The $1bn elephant in the room — the fact some aspects of the sharing economy are becoming the very thing they set out not to be — has basically become too enormous to ignore. Read more
“Reserve” is the new app that Silicon Valley — specifically Uber’s Garrett Camp and Foursquare’s Naveen Selvadurai — insists we will all be going mad about this year.
What is it? Another crypto-currency system? A payments ledger to rival the mighty Special Drawing Right? Perhaps it’s an app that allows you to re-serve your uneaten food?
You know… like a Grindr for leftovers? Read more
The following arrived in our inbox this Tuesday from Hailo, the cabby app which allows you to hail a cab using a mobile:
As of 5pm today you’ll find a free £10 credit applied to your Hailo account which expires at midnight tonight.* Make the most of your evening, stay out late or swap your normal commute with a safe, comfortable and cool cab home. Or why not try our new luxury HailoExec service? Just hit Pick Me Up Here and swipe across to select it. It’s a little post Bank Holiday gift from us to help you enjoy a hassle-free summer with Hailo.
An online service that matches buyers and sellers you say? Worth $18bn? Well, there are a lot of taxis in the world.
We have seen this one before though, so $18bn is entirely possible, if not necessarily sensible.
Consider this chart of the original dot com network effect superstar, eBay. Read more
There have been protests. There has been legal risk. There has been disruption. And there have even been questions about whether breaking all the rules is really all that innovative.
But Uber, the taxi app formed by Garrett Camp and Travis Kalanick in 2009, is heading for a funding round anyway, and it’s doing so at a proposed market value of $10bn. (Note to FT Alphaville selves — we must really get round to launching that Shut App!* idea we’ve had.)
Is that sort of valuation justified? Who knows. Read more