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UBER Prezi

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Bernard O'Brien

on 23 February 2015

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Transcript of UBER Prezi

design by Dóri Sirály for Prezi
CEO Travis Kalanick
Sector Experience
Age/Gender
A sexy man!!!
Managerical experience
Serial Entrepreneur
Scour - File sharing



Co- founder Garrett Camp
GM Ryan Graves
So who are UBER?
UBER & THE RISE OF THE SHARING ECONOMY


''Demand-side drivers Vs Supply-side tech drivers''


SHARING ECONOMY VALUED AT > $1bn (Regner, 2014)



A stark reduction in transaction costs that allows for radically disaggregated Consumption (Botsman, 2010).

Sharing Economy: 2 Types
Asset Hubs – Rise of the Microrental e.g. ZipCar
Peer-to-peer networks - connect many would-be sellers or workers with many would-be buyers or employers e.g. UBER, Lyft, SideCar, AirBnB


SUBURBS TO CITIES
UBER'S STORY


'Its a lifestyle, who's the baller?

iOS APP launched in 2010

Luxury car service for the masses

Early adopters in Bay 'Tech' Area

Word of mouth marketing

Famous advocates



FUNDAMENTALS OF THE SHARING PLATFORM


Exchange goods and services and offer to backstop and insure transactions. In exchange, collect a “broker’s fee” on each peer-to-peer transaction

Arguments for:
creation of new markets in previously untraded sectors
bypassing of sclerotic competitors
new opportunities for the under/un-employed

Arguments against:
exploiting “desperate” employees
flouting local regulation
claiming vast profits under the cloak of community collaboration



THE SHARING PLATFORM MODEL


UBER: creates and serves “two-sided” markets: their users include both market buyers (riders) and market-sellers (drivers) mitigating coordination problems between buyers and sellers
Surplus effects as result of pre-existing assets being traded in new ways
Economies vs. diseconomies of scale = optimal size of platform?


MACROECONOMIC EFFECTS OF SHARING

End of Idle Capacity e.g. average car idle 23hrs per day
Commitment to Choice e.g. anyone can offer rides = risk for passengers

GROWTH RATE OF ONE CITY PER DAY
64% OF US CITIES WITH ACCESS TO UBER – SOME CITIES CANT SUSTAIN THE UBER ECOSYSTEM

“If we’re not there now, we’ll be there in a week.” Austin Geidt, Head of Global Expansion

Internationalisation
UBER: SCALING CONSIDERATIONS & DIFFICULTIES

Local regulatory issues

For us to be successful in new markets, we’ve had to plan for those issues, navigate them, understand the market dynamics, and find ways to maneuver our strategy to adapt to those environments.


Hype management

If we hadn’t managed that attention appropriately, it would have been easy to lose focus, and deviated from the path we knew made the most sense for the business.

Recruitment – “hire slow, fire fast”
Focus on the individual first, culture will take care of itself
Terms of the VC deal – aligned with short and long term goals
Auxillary value of particular VC firms
Strong relationship with investors


Ryan Graves
Head of Global Operations


SURGE PRICING


RISE OF THE “GIG ECONOMY”


EMPLOYMENT CLASSIFICATION –
drivers as “independent contractors” and thus entitled to reimbursement (Farrell, 2014)



PAY-RATES
FUNDING UBER

2011 $50M from investors

2012 seen UberTaxi in Chicago launched

Early 2013 saw UberChopper trial ($3,000)

Sept 4, 2013 saw the first NFL Sports Partnership

35 Cities by end of 2013

Uber Valued at $41Bn (Forbes 2015)

More valuable than 72% of Fortune 500




5X 5X 20X
The need for Uber

Frustrating and broken Taxi service

Unsatisfied customers/drivers

Identified fail points in the entire service (Bitner et al; 2008)

A willingness to improve every 'Touchpoint' in a lackluster service

'A complete solution for riders'-
CEO Travis Kalanick

Or was it as simple as Travis seeing this?

Predicted: Uber and City Governments will strategically partner e.g. government contractor for municipal services

Other option: provide the government with data e.g.information about where people

want to go and leave and when, which could aid everything from public transportation routing to
land use planning
Strategic Partnerships:
Uber’s main competitor is Lyft.

Others:
-Side Car
- BlaBlaCar

Non sharing firms: incumbent taxi firms and
regulators

Smaller cities may see the entry of one sharing firm, but not its competitors, creating concerns about
market power. These cities might consider providing subsidies in order to promote competition
among sharing firms

Competitor Mapping
(Source: Storey, 1994; Smallbone & Wyer, 2006, 2012)

GROWTH HACKING PROCESS (Patel and Taylor, 2013)

1. Define actionable goals e.g. increase users by 2x

2. Implement analytics to track goals e.g. views, shares etc

3. Leverage existing strengths e.g. unique distribution list

4. Execute an experiment e.g. hypothesis re: effect of user content on hit
rates such as Uber CHOPPER rides to the Hamptons $10 off coupons

5. Optimise the expt e.g. control group, A/B test

6. Repeat











UBERS GROWTH ENGINE



Accelerants:

1.Restaurants and Nightlife
2.Holidays and events
3.Weather
4.Sports (Source)

Other:

Events and holidays
Low risk trials







ACQUISITION (adwords, facebook, other channels)

VS. OPTIMISATION (owned properties, apps, website, landing page)



“UBER makes it very easy not to own a car”
Brian Chesky, CEO AirBnB

Return on Investment


‘Venture capital funding is generally seen as appropriate for firms in high- and new-technology based industries’ (Deekins and Freel, 2012)

Investors regard the sharing economy as the new “mega-trend”; investing hundreds of millions into related start-ups (Alsever, 2013)


Supply Chain Scalability

Positive network effects facilitate scaling:

- Low barriers to entry into niche markets
- Wide Reach of supply
- Very low fixed costs
- Satisfying latent Demand
(Zervas et al, 2002
)




Uber’s Innovation - "Disruptive Transportation"

Kalanick’s vision to revolutionise a technologically stagnant industry

‘Innovation should be seen as a radical and disruptive departure from existing practice’ (Schumpeter, 1950)

Uber represents an Innovation in Process (Schumpeter) - prediction algorithms and heat maps to match supply and demand.

“Shorter waits for riders and busier, more efficient days for drivers”

Low cost approach of matching Buyers and Sellers:

Improved Data Storage and Analytics
Smartphone Proliferation
Widespread GPS Tracking

Mobile Affiliate marketing











Market Development

Focus on Large Cities – ‘Agglomeration Economics’
Differentiator Strategy – Charging a premium for convenience and quality (1.5 Times normal taxi rate)

Crossing the Chasm
UBER style:


Innovators and Early Adopters:
Tech friends
Early Majority
:Upper class professional spending $100 per month – “an astonishing figure for an app company”
Late Majority:
Urban Middle-class: non-luxury cars at lower price

Finances & Valuation

Private Company
Leaked document shows figures for Dec 2013
Year on year growth Dec 2012 – Dec 2013 of 369%
Estimated revenue of $2bn in 2014
Projected revenue of $10bn in 2015
Majority of revenue from 10 cities


Finances & Valuation
UBER Scandals
Uber in the media




Kalanick : no plans to IPO (WSJ interview, June 2014)

Hire David Plouffe (Aug 2014)

PR strategy to soften image of Travis Kalanick

“Uber is the most arrogant company I’ve encountered, and the most unethical” Peter Sims, Venture Capitalist (October 2014)

Vs


“Brand Ambassadors”

“SLOG” campaign

Executive headhunting

Litigation

UBER's Start up Guide to Sharing


1. Open and develop customer bases before getting
regulatory approval

2. “We’re not service providers” but networks for connecting third parties

3. Leverage significant customer base to overcome politicians and regulators (Scheiber, 2014)

4. Develop sophisticated political arm (Uber’s David Plouffe) Too big to ban


Finances & Valuation


Last round of VC of $1.2bn valued Uber at $18bn (June 2014)

More valuable than 72% of Fortune 500 companies

$41bn valuation (Jan 2015)

Return to original investors of 4500X






sUBER Growth
Uber's Patent Locations
Competitors

‘Sharing Taxi’ Companies



Traditional Transport Providers:




Final Thought

Internationalisation and IPO
Circumventing local regulation
Public-private partnerships

Smart City Planning e.g. Emergency Response, Policing, Traffic Control

Utilising DATA to become UBER
Universal
Booking
Engine
Real time
''A Total Solutions Provider''

''DISRUPTIVE TRANSPORTATION''
Product Development

Market Segmentation and Positioning:











Diversification:
Uber Patent Domains
2015
4.
Full transcript