1 – License Revoked
Uber lost its operating license in London, after it was discovered that more than 14,000 trips had been made by drivers with fake registrations on the app. The startup was given two months' notice to make the required corrections, such as verifying driver identities and vehicle insurance, which is mandatory there. According to the authorities, Uber was putting its passengers at risk and is not fit to operate. This does not mean, however, that app drivers will stop operating immediately. The company has filed an appeal and continues its operations pending a verdict.
2 – It Has Not Been Easy
As a consequence of this loss, Uber shares fell 6.3% this week. This represents a drop of US$ 3 billion in the startup's valuation. According to analysts, this is yet another sign of the regulatory challenges the company may face in certain cities. Furthermore, London represents a significant portion of revenue and, given the prospect of never turning a profit, every cent counts.
3 – In the Red
Despite a 30% revenue growth – US$ 3.8 billion in Q3 – Uber continues to close its books in the red, with a loss of US$ 1.2 billion in the period. Although the result was better than analysts had expected, it was not enough to revive the market. Following the release of the earnings report, the company's shares fell approximately 6%.
4 – Uber Launches New Design for the Uber Eats Delivery Drone
Uber Eats and Uber Elevate will offer dinner for two via drone starting next summer in San Diego. Unveiled at last week's Forbes Under 30 Summit in Detroit, the delivery drone design features six rotors, rotating wings, and can carry a meal for two in its body. Although the drone's maximum travel time remains relatively short (eight minutes including loading and unloading), it is capable of covering a distance of 30 kilometers, split into three legs of 10 kilometers each (from the charging point to the restaurant, from the restaurant to the customer, and back to base).
The current plan involves flying from restaurants to a test location, where an Uber driver covers the last mile to deliver to the consumer. However, with an eye on the future of automated last-mile delivery, Uber is also considering landing drones on the rooftops of delivery vehicles.
It is quite likely that, soon, we will begin to witness the commercialization of autonomous drones for everything from food and Amazon product deliveries to humanitarian aid. If the technology “takes off,” there will be two main impacts:
- A sharp decline in the hiring of humans for delivery roles
- An increase in the hiring of humans for drone maintenance and programming
5 – Uber Money
This week Uber announced yet another spin-off: Uber Money. The primary audience for this new initiative is the more than 4 million drivers the app has worldwide. The service will offer a digital wallet as well as credit and debit cards. According to the startup's executives, nothing prevents them from offering the same to users in the near future. Whatever it takes to get out of the red, right?
Uber has a new venture – and it is not in the ride-hailing sector. The company launched Uber Works, a platform for hiring temporary workers.
The goal is to connect candidates with temporary job openings and recruiters. Just as with the ride-hailing app, payment for work is made directly through the application.
Uber has been diversifying its business portfolio for some time now. The company started in mobility, moved into food (with Uber Eats), and will now work with temporary labor hiring.
However, it is not as though it is starting from scratch – it already has millions of users and workers registered across its platforms.
And, even more importantly, Uber already works with temporary workers – drivers and couriers. It is simply expanding the initiative to other sectors, opening positions for cooks, cleaners, event staff, and more.
Initially, the new feature is being tested in Chicago, in the United States, where users rely on staffing agencies to handle payroll and benefits.
6 – Uber Works
Uber Works was launched at a time when Uber's business model, although replicated by competitors worldwide, is being called into question.
Recently, the Governor of California, in the United States, signed a law stipulating that app-based drivers (and all independent workers) must be classified as employees of the companies they work for, in compliance with local labor laws.
This ruling is contrary to that of the Brazilian Superior Court of Justice. Today, the company pays neither wages nor employment benefits.
Now, with the California government's decision, there is a risk of a major impact for a company that has yet to turn a profit, should other states and countries follow this example.
Uber Works has just launched, but already faces competition in the market. In the United States, there are solutions such as Shiftgig, and in Brazil, GetNinjas. The Brazilian startup has become a marketplace for hiring freelance and/or temporary professionals – and is in the process of expanding into Latin America.
What do you think about Uber's latest moves?
Source: Startse and Peter Diamandis