We’ve heard the catchy descriptions: “We’re the Uber for Weed” (Eaze); “we’re the Uber for Massage” (Soothe); “the Uber for Booze” (Drizly). The list goes on…
Uber proved the scalability of the so-called “2-sided market” 10 years ago, spawning copycats across dozens of industries.
Has the mimicry worked? Based on Alexis Madrigal’s survey in The Atlantic, yes — for the companies, at least. For everyone else? Maybe not.
The Uber-ization of everything
There are hundreds of Uber-for-[X]s. The survey tracks 105 of them (in this lavish spreadsheet): Together, they have raised more than $7.4B in VC investment in industries ranging from food delivery to fitness.
But, to the more important question: How successful were they?
Here’s the breakdown: 54 are still kicking, 28 have gone the way of Enron, 19 have been acquired, and 4 have achieved hallowed “unicorn” status.
Imitation is the sincerest form of… fundraising?
The overwhelming majority, 73 of 105, did not fail. In pursuit of rapid growth, investors lined up for startups built from a template. But is “not failing” the same as succeeding?
Consider this: Uber is still not profitable, (despite the $24B it’s raised). The 4 unicorns in the group — Instacart, DoorDash, Grubhub, and Postmates — have followed Uber’s expensive lead, raising an average of $1B apiece without becoming fully profitable.
Most gig economy platforms aren’t profitable — and may never be. Lyft’s IPO statement says: “We have incurred net losses each year since our inception and we may not be able to achieve or maintain profitability in the future.”
There aren’t many winners here
Well, these platforms must be good for workers and consumers… right?!
Not exactly: Ridesharing makes traffic worse, and gig workers struggle to make ends meet. But a myth of the “financial independence” they provide keeps these gig companies afloat in the court of public opinion.
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