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I believe that sharing your moments of failure is the most powerful thing in the world — and I am not afraid to share this with you. In March 2011, I applied for a job at Uber, and I created a presentation with my application to differentiate myself from every other candidate. At that time, Uber had just 10 employees and was renting two desks at Rocketspace, a shared office in San Francisco. I was working on my own startup idea at Rocketspace, and I sat next to the Uber team every day. I remember how much their work ethic impressed me. I knew their team would build one of the most important companies in the world. Uber is now an $18 billion company and has 1000+ employees throughout the world. I created this presentation when Uber was operating only in San Francisco and I imagined what a potential expansion to Los Angeles might look like. I worked on the proposal for two weeks and worked up the courage to email the Uber founders directly. I never heard back. ------------- A week after failing to secure a position at Uber, I accepted a job at Zaarly, and embarked on the most incredible adventure of my life. I met the most amazing people in the world, lived in 10 apartments in 2 years, and traveled the country. The company is not yet worth $18 billion dollars, but I loved every single minute — and I would trade that experience for anything in the world. ------------- What have you failed at in your life? Share those moments with the world and be proud that you are now a better version of yourself. Failure is a beautiful thing — and you should never hide from it. No regrets. Never ever. -Jeff Morris Jr. ------------- Note: This author is still a loyal Uber customer and is great friends with several members of their team. He is also working building his own startup and promises to share his failures along the way. Hopefully he can share a few victories too ☺
Citation preview
Los Angeles – Taxi Industry Overview
2
Fare Revenues LA Taxi franchises are worth an estimated $180 million in annual fare revenue from the 2,303 licensed taxis operating in the City of Los Angeles. The City’s take is about $4.5 million a year in franchise and related fees
Taxi Market 9 companies control all of L.A.’s 2,303 cabs largely through a structure of cooperatives and private corporations. Approximately 3,500 drivers make an estimated 7 million taxi trips each year
Ownership One-third of the drivers own their cabs; two-thirds lease cab time when the owners aren’t behind the wheel. Each cab owner has a share in the company, which they pay for with an annual fee for permits and access to company dispatchers
Wages The average wage for taxi drivers is $11.75 an hour – usually without health benefits – and they spend approximately 61 hours per week fighting L.A.’s notoriously congested streets
Drivers The median driver is a 47-year-old man who is a legal immigrant and a father of school age children, who sometimes works 18 to 20 hour days
Cars The driver’s workplace is typically a used police car worth about $4,000, now painted yellow and equipped with a leased radio and taxi meter
3
Cab Fare Averages – Los Angeles Ranked no. 6
3
Fares for Typical Trips Area Costs . . . City
DC suburbs**
San Diego**
Orlando
Denver
New Orleans
Cleveland
Phoenix
Honolulu**
Miami* San Francisco** Boston** Los Angeles** Seattle* Las Vegas St. Louis Philadelphia* Atlanta
Minneapolis
New York**
Houston Chicago**
Dalllas
Detroit Baltimore
Avg. US Trip ($)
$12.08
$16.17
$13.38
$13.23
$11.80
$10.78
$12.87
$19.75
$16.10 $15.90 $15.45 $15.00 $14.80 $14.75 $14.30 $14.17 $14.00
$13.37
$13.10
$12.85 $12.70
$12.55
$11.65 $11.60
Short Trip ($)
$8.35
$10.59
$8.89
$8.74
$8.21
$7.21
$8.83
$13.04
$10.73 $10.85 $10.08 $10.07 $10.29 $10.27 $9.81 $9.47 $9.52
$9.11
$8.65
$8.81 $8.66
$8.52
$8.07 $7.99
Long Trip ($)
$23.70
$33.67
$27.38
$27.23
$23.00
$21.98
$27.10
$40.75
$32.90 $31.65 $32.25 $30.40 $28.80 $28.75 $28.30 $28.87 $28.00
$26.67
$27.10
$25.45 $25.30
$25.15
$22.85 $22.80
Initial Charge
2.25
2.00
1.60
2.50
1.80
2.50
3.00
2.50 2.85 1.75 2.20 2.50 3.20 2.50 2.30 2.50
2.50
2.50
2.50 2.25
2.25
2.50 1.80
Initial Distance
1/10
1/4
1/8
1/8
1/6
1/6
1/4
1/6 1/5 1/8
1/11 1/10 1/8
1/10 1/7 1/8
1/5
1/5
1/6 1/9
1/9
1/8 1/8
Mileage Charge
0.25
0.25
0.25
0.20
0.40
0.30
0.75
0.40 0.45 0.30 0.20 0.20 0.25 0.20 0.30 0.25
0.38
0.40
0.30 0.20
0.20
0.20 0.20
Mileage Distance
1/10
1/8
1/8
1/8
1/4
1/6
1/4
1/6 1/5 1/8
1/11 1/10 1/8
1/10 1/7 1/8
1/5
1/5
1/6 1/9
1/9
1/8 1/8
Wait Time Per Hour
20.00
22.50
22.50
18.00
15.00
20.00
30.00
24.00 27.00 24.00 24.00 30.00 22.00 24.00 20.00 21.00
21.00
12.00
20.00 20.00
18.00
16.00 24.00
Last Change
Nov-05
Oct-05 Sep-03 Sep-02 Nov-05 Apr-05 Apr-05 Jul-03 Jul-05 Oct-05
Sep-05
May-04
Aug-05 May-05
Nov-05
Aug-01 Jul-05
Components of the Fare
Boston and NYC also prime markets
Los Angeles – Taxi Operators
4
United Independent Taxi Drivers (United Taxi of San Fernando Valley) San Gabriel Transit (City Cab)
LA Taxi Co-operative (Yellow Cab Company and Fiesta Taxi)
Beverly Hills Transit Cooperative (Beverly Hills Cab Company)
Independent Taxi Owners’ Association (Independent Taxi)
United Independent Taxi Drivers (United Independent Taxi)
Los Angeles Checker Cab Company (Checker Cab)
Bell Cab Company (Bell Cab)
South Bay Co-operative (United Checker Cab Company)
Company Zone A – San Fernando Valley
Zone A – San Fernando Valley Zone C – Central and Eastern Zone B – Western Zone C – Central and Eastern Zone D – South Central Zone B – Western Zone C – Central and Eastern Zone B – Western Zone C – Central and Eastern Zone D – South Central Zone B – Western Zone C – Central and Eastern Zone D – South Central Zone B – Western Zone C – Central and Eastern Zone D – South Central Zone B – Western Zone C – Central and Eastern Zone D – South Central Zone E – Southern
Service Area 100
96 70
160 370 209
93 70 72
110 64 88
130 71 67
134 68 70
126 65 70
No. of Taxis
100
166
739
163
246
289
269
261
70
Total Taxis
Los Angeles – Taxi Zones
5
Los Angeles Taxi Passenger Complaints
6
296
2007 – Nos. and % of Total
3 - 1.0%
22 - 7.4%
26 - 8.8%
80 - 27.0%
8 - 2.7%
34 - 11.5%
61 - 20.6%
43 - 14.5%
12 - 4.1%
1 - 0.3%
0 - 0.0%
6 - 2.0%
Total
Company Type
1. Company Service Refusal
2. Driver Service Refusal
3. Service Time Response
4. Driver Discourtesy
5. Driver Service
6. Driver Safety and Ability
7. Overcharge
8. Payment Acceptance (CC)
9. Vehicle Condition
10. Dispatch Service
11. Insurance
12. Other Operator Problems
235
2008 – Nos. and % of Total
1 - 0.4%
17 - 7.2%
12 - 5.1%
63 - 26.8%
19 - 8.1%
23 - 9.8%
58 - 24.7%
34 - 14.4%
4 - 1.7%
1 - 0.4%
0 - 0.0%
3 - 1.3%
214
0 - 0.0%
25 - 11.7%
11 - 5.1%
32 - 15.0%
24 - 11.2%
27 - 12.6%
33 - 15.4%
27 - 12.6%
9 - 4.2%
0 - 0.0%
1 - 0.5%
4 - 1.9%
2009 – Nos. and % of Total
The total number of complaints received for overcharges (sub-item 7) has decreased, but it remains the no. 1 ranked complaint, followed by driver discourtesy, driver safety and ability, and payment acceptance.
Taxi Service – Growth in Los Angeles
7
1,347 1,432
2,143
2,303
1,000
1,200
1,400
1,600
1,800
2,000
2,200
2,400
1990
Jan-
92
Jan-
93
Jan-
94
Jan-
95
Jan-
96
Jan-
97
Jan-
98
Jan-
99
Jan-
00
Dec
-00
Jul-0
1
Jul-0
2
Jul-0
3
Jul-0
4
Jul-0
5
Jul-0
6
Jul-0
7
Jul-0
8
Jul-0
9
Chart 2A Taxicab Vehicle History – City of Los Angeles Vehicle Authority and PC&N History Since 1990"Number of taxicabs authorized and actual numbers decaled
Vehicles authorized Vehicles decaled (operating)
8
Los Angeles: Rate Optimization
8
Pricing Uber pricing must be adjusted to account for the urban sprawl – consider new prices for distance and idle time. Los Angeles has 6,499.5 miles of public streets in an area of approximately 470 square miles.
Flat Rates
Event Pricing Offer “Event” pricing for all major sports teams, events, and venues. Examples include: • Beverly Hills Staples Center for Lakers/Clippers/Concerts. • Westwood Pasadena for UCLA football games.
Time of Day “Time of day” pricing should be a consideration due to traffic (see slide #10). • In Los Angeles: On Thursday at 5:30 p.m., the average trip takes 71 percent longer than normal. • In San Francisco: On Thursday at 5:30 p.m., the average trip takes 63 percent longer than normal.
Flat Rates should be offered for many destinations, in addition to major airports. The City has limited pedestrian traffic and citizens rarely “hail” cabs on the streets.
Los Angeles Traffic 2010: Worst in the World
9
Travel Time Tax in Los Angeles: 34.7% average
• Time tax is additional cost of travel above the uncongested conditions
Uber vs. Taxi – Los Angeles Airport
10
Destination
Staples Center – Downtown
3rd St.Promenade – Santa Monica
Rodeo Drive – Beverly Hills
Sunset Plaza – Hollywood
Origin
Los Angeles Airport
Los Angeles Airport
Los Angeles Airport
Los Angeles Airport
Uber Fare
$106.00
$92.14
$83.05
$108.24
Uber Cost Multiple
1.62x
1.64x
1.62x
1.64x
Trip Statistics
16.94 miles 26 minutes total 12 minutes idle
14.11 miles 25 minutes total 12 minutes idle
13.02 miles 27 minutes total 9 minutes idle 17.65 miles 32 minutes total 11 minutes idle
All fares estimated for 6:00 pm trips Taxi fares include 15% tip Uber fares = $8.00 base + $4.90 per mile + $1.25/idle minute (no tip)
$65.19
$56.24
$51.13
$65.81
Taxi Fare"$
Uber vs. Taxi – West Hollywood
11
Destination Origin Taxi Fare"$ Uber Fare
Uber Cost Multiple Trip Statistics
Staples Center West Hollywood (Fairfax Ave/Santa Monica Blvd.)
$38.78 $67.69 1.75x 9.63 miles 22 minutes total 10 minutes idle
Los Angeles Airport West Hollywood (Fairfax Ave/Santa Monica Blvd.)
$51.01 $89.28 1.75x 12.25 miles 37 minutes total 17 minutes idle
Dodgers Stadium West Hollywood (Fairfax Ave/Santa Monica Blvd.)
$36.54 $64.40 1.76x 8.96 miles 21 minutes total 10 minutes idle
Malibu Country Mart West Hollywood (Fairfax Ave/Santa Monica Blvd.)
$88.41 $152.34 1.72x 24.1 miles 44 minutes total 21 minutes idle
All fares estimated for 6:00 pm trips Taxi fares include 15% tip Uber fares = $8.00 base + $4.90 per mile + $1.25/idle minute (no tip)
Largest Private Car Fleets in Los Angeles
12
Company Name Name of CEO City, State Total
5 Music Express Cheryl Berkman, CEO
Los Angeles 30 197 44 24 0 11 0 0 306
6 Diva Limousine BijanZoughi, CEO
Los Angeles 45 109 52 16 0 4 0 0 226
35 VIP Limousines & Coaches Inc. Roger Webb, CEO
Santa Ana 5 32 4 2 1 16 4 5 69
54 Best Chauffeured Worldwide Robert Vaughan,CEO
Huntington Beach 3 22 5 6 1 14 0 0 51
Limo Sedan SUV Van Limobus Shuttle Motor-Coach Other
USA Ranking
Action – identify highest-rated private fleets in Los Angeles submarkets. Account for revenue, employee size, fleet size, car models, location, and price.
Customer Acquisition Strategy
13
Sub-markets
Corporate Accounts
Focus on Entertainment, VC, Technology, and Finance.
Entertainment – Century City, Beverly Hills, Studio City, Santa Monica
Venture Capital – Santa Monica, Sherman Oaks, Downtown, Westwood
Technology – Santa Monica
Finance – Century City, Downtown
Prioritize locations based on demographics and revenue potential. Acquire Uber customers who evangelize the product
Demographics: Most Expensive Zip Codes in LA
14
City, Zip Code
Median Home Price"$
Median Household Income"$
Beverly Hills, 90210 6 $3,684,150 $112,572
Malibu, 90265 24 $2,730,577 $100,857
Beverly Hills, 90077 33 $2,347,030 $141,527
Santa Monica, 90402 35 $2,338,049 $118,553
Pacific Palisades, 90272 46 $2,133,148 $122,877
Manhattan Beach, 90266 87 $1,641,666 $100,761
Santa Monica, 90401 104 $1,491,117 $48,317
West Hollywood, 90069 130 $1,368,998 $51,215
Hermosa Beach, 90254 138 $1,333,731 $81,352
Century City, 90067 155 $1,237,576 $74,830
Venice, 90291 157 $1,229,241 $45,769
Beverly Hills, 90212 161 $1,224,020 $61,039
Los Feliz, 90027 223 $1,006,491 $31,820
Hollywood, 90068 232 $993,523 $52,890
Brentwood, 90049 75 $1,693,033 $84,342
Beverly Hills, 90211 164 $1,209,132 $57,746
Pasadena, 91105 219 $1,018,709 $83,737
National Rank
Action – perform detailed analysis of every listed zip code (age, gender, education, public/private transportation, social habits, profession) and prioritize locations for launch.
Corporate Accounts – Fortune 1000 Companies in Southern California
15
60 67 69 98
126 165 168 184 241 298 319 329 376 398 415 433 458 464 495 517 524 545 551 580 673 675 682 705 745 769 800 878 902 927 932 986 993
Rank Walt Disney Ingram Micro Northrop Grumman Occidental Petroleum Direc TV Group Health Net Amgen Edison International Jacobs Engineering Group Reliance Steel & Aluminum Western Digital Dole Food Avery Dennsion First American Corp. Mattel DaVita AECOM Technology CB Richard Ellis Group Broadcom Allergan Live Nation Unified Grocers Pacific Life Stater Bros. Holdings Molina Healthcare Beckman Coulter KB Home Activision Blizzard Quiksilver Watson Pharmaceuticals Mercury General Guess Ryland Group Teledyne Technologies Sun Healthcare Group Public Storage Fleetwood Enterprises
Name $37,843.0 $34,362.2 $33,940.0 $24,480.0 $19,693.0 $15,366.6 $15,003.0 $14,112.0 $11,252.2
$8,718.8 $8,074.0 $7,732.4 $6,710.4 $6,213.8 $5,918.0 $5,660.2 $5,216.2 $5,130.1 $4,658.1 $4,403.4 $4,327.1 $4,104.8 $4,023.0 $3,741.3 $3,112.4 $3,098.9 $3,033.9 $2,898.1 $2,638.8 $2,535.5 $2,414.2 $2,093.4 $1,976.1 $1,893.0 $1,883.7 $1,745.6 $1,736.6
Revenues"$ millions
Burbank Santa Ana Los Angeles Los Angeles El Segundo Woodland Hills Thousand Oaks Rosemead Pasadena Los Angeles Lake Forest Westlake Village Pasadena Santa Ana El Segundo El Segundo Los Angeles Los Angeles Irvine Irvine Beverly Hills Commerce Newport Beach San Bernadino Long Beach Fullerton Los Angeles Santa Monica Huntington Beach Corona Los Angeles Los Angeles Calabasas Thousand Oaks Irvine Glendale Riverside
Location
Los Angeles Visitors: Bay Area Ranked No. 1
16
LA’s Top 5 Domestic Feeder Markets"Percent of all domestic overnight visitors to LA
Seattle-Tacoma
New York
Phoenix
Sacramento-Stockton-Modesto
San Diego
San Francisco-Oakland-San Jose
Santa Barbara-Santa Maria-SLO
Philadelphia
Fresno-Visalia
Las Vegas
San Francisco and Uber Cities
17
Travel Accounts
During initial expansion, San Francisco Uber passengers should be served in their most traveled destinations. “On the road” support from early adopters will be critical.
San Francisco Departures
Los Angeles ranks no. 4 among cities that San Francisco travelers are looking to visit
1. New York 2. Washington, DC 3. Boston, MA 4. Los Angeles, CA 5. Chicago, IL
6. Seattle, WA 7. Dallas, TX 8. Newark, NJ 9. San Diego, CA 10. London, United Kingdom
Substitute for Car Rentals
Allow travelers to book Uber rides in advance – important for airport rides at LAX.
College Campus Reps
18
New Freshmen
New First-time Freshmen, by Home Location
USC Fall 2010
911
571
1,074
313
Nos.
2,869
31.8%
19.9%
37.4%
10.9%
%
100.0%
UCLA Fall 2010
2,078
2,123
176
45
Nos.
4,422
47%
48%
4%
1%
%
100.0%
Other California
Out of State, but in US
Outside US
Total
Los Angeles/Orange County
At a Glance – Student Characteristics
31.4% of USC students are from Los Angeles/Orange County
47% of UCLA students are from Los Angeles/Orange County
Uber will target the local college student demographic, as they are likely to promote the service to friends and family in the area
Los Angeles college students are more mobile than Stanford or Berkeley and leave campus frequently
Action: Hire campus representatives and interns to promote Uber
Strategic Partnerships
19
REITs Apartment and office REITs that house
employees at home and at the workplace. Become preferred provider and create revenue share agreement with groups that have millions of productive employees underneath their rooftops
Hotels Joie de vivre (recently partnered with
Virgin), W Hotels, Kimpton Hotels, SLS,"Hyatt, Marriot, Ritz Carlton
Sports Teams Entertainment Industry
Los Angeles – Marketing Targets
20
Publications Technology (With Offices in LA)
Events Venues
21
Uber Ideas for all Locations
21
Free Wifi Install free wifi in Uber cars. Connectivity remains an issue for travelers on the move. In Tokyo, 820 black sedans operated by DoCoMo will offer free wifi in March 2011. Establish partnerships to subsidize wifi costs – like Google on Virgin America flights.
iPhone Chargers Every Uber vehicle will be equipped with a complimentary iPhone charger for passenger use. Uber riders should never run out of battery!
Sponsored Rides On weekend nights: “sponsored rides” awarded to limited number of customers. Partner with brands and local businesses to pay for sponsorship opportunity. Ex: In SF, Tipsy Pig offers bar patrons with $200 bar tab a free local ride after 1:45am.
Uber Safe Partner with colleges/safe ride programs to promote Uber Safe. Offer discounted fares to students at college bars. Allow advertisers to pay for student “Uber Safe” trips at night. Allow students to pay with pre-loaded accounts like University ID (ex. Bruincard at UCLA).
Uber Social Connect with 3rd party APIs for linking passengers to information they care about on sites like Twitter, Facebook and Foursquare. Passengers can be alerted when friends are close by and determine the best way to meet up.
Uber Nascar Buy a Nascar team. Hire Danica Patrick to drive. Just kidding… don’t do that