📝Uber proved the scalability of the 📝Two-Sided Marketplace in 2009, spawning copycats across dozens of industries. The survival of Uber-for-[X] startups shows the power of ‘the Uber effect’; those who market themselves as, “the Uber for Weed” (Eaze),“ the Uber for Massage” (Soothe), “the Uber for Booze” (Drizly), etc.
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.
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 statementsays: “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.