This is called "Being disruptive." Basically, just ignore the law, but make sure you get enough workers and customers that love you so that they turn against politics when you break the law.
The issue is that not every industry is so inefficient as to be possible to legally disrupt profitably, so people try to do an end-run around the law.
Uber's autonomous car fatally collided with a woman, raising questions of negligence and liability in automation.
Uber acquired some of Alphabet/Waymo's trade secrets when they aqui-hired one of their former engineers who apparently kept a bunch of Waymo's IP he worked on. That engineer himself is now facing a federal indictment, and Uber and Waymo have settled.
E-scooters are facilitating a number of city-specific crimes (it's usually illegal to operate a vehicle, bike, or skate on a city sidewalk and the e-scooters do not provide helmets but neither do the riders). To say nothing of the legally dubious use of public property to deploy them.
Move fast and break stuff indeed.
If anything, I'd expect it to work against them.
What was/were the other crime(s)?
As it was originally proliferated in reference to tech ventures, it referred to a very specific pattern highlighted by Clay Christensen's writings out of HBS.
In classical "disruption," a product or technology that is notionally "worse," but as a result greatly cheaper or more easily distributed, takes over a market from notionally "better" but more expensive legacy approach. Often includes de-skilling of the use case too.
It's sort of like guerilla warfare in that way.
The successful recent IPOs people are pointing to in this comment section -- like Zoom, Datadog, and Cloudflare -- all tend to have a version of this classical disruption if you try and see it.
I say this not for mere pedantry but because taking "disruptive" to mean "F---ing things up (rules, laws, etc.)" dilutes a useful concept in thinking about technology adoption approaches.
This is more an inditement of modern society, highlighting how much freedom we have lost
When an app like uber is "illegal" one can not call that society free in the least bit.
The fact that most things are by default a violation of some law or regulation is the #1 reason we are no longer innovating as fast as we used to.
Some might see this as a good thing, I do not
You don't ask the question, why should an app like Uber be illegal? Why should taxi medallion holders have a monopoly on on-demand transportation in a city? To make hedgefunds rich?
Transportation across cities in North America sucked before Uber. You are completely delusional if you think pre-Uber and pre-Lyft cities were some kind of transportation mecca. It was horrible. I used to wait in the rain at UCSF for 30 - 45 minutes on the curb waiting and hoping for a taxi and finally just pitifully walking home getting drenched.
I love having a ride-hailing app and not having to waste money on a car or motorcycle.
I really think people that love static bureaucratic states should go live in France or some communist nation.
Uber and Lyft can't start up in a city if they have to wait for all the politicians and bureaucrats to give them an okay, when these people are bought and sold by unions and hedgefunds. Only delusional people think there's a path to disrupt that kind of logjam by waiting in line like a "good boy".
Medallions are just a mechanism for limiting the number of cabs to what the street network can support; isn't that obviously necessary?
On the other hand, it appears from what I read that Uber may have actually been dealing with the problem by charging surge rates and then keeping most of it, thereby reducing demand without increasing supply which is just what is needed. But that outrages everybody, so the argument for having the government ration things is that it's more socially acceptable - which is a valid reason!
The apps of Uber and Lyft seem to me like valuable innovations in that they allow you to get information on your ride, predict the cost, and pay with a credit card which are great improvements on regular cabs.
But cheering unregulated cabs makes no sense to me - the streets in a given city seem obviously a commons that needs regulation. Uber and Lyft are forms of regulation, so really, people only debate the details. Freedom vs. non-freedom is a caricature.
Unfortunately, this seems to be the only way that's not outright massive violence such as Hongkong or France to get politicians to do their goddamn job. Taxi services have had a really massive lobby power in the US.
If not then this is just a silly point. Some of the regulations were unreasonable and the result of corruption - but Uber also skirted insurance and background check related laws at various times.
The end result is a safer, better-functioning street transit system (in New York at least). I don't care if they were in it for social change or for the money. They delivered results, both themselves and by kicking taxis up a notch.
(Many activists aren't in it for altruistic purposes. That doesn't make their work less meaningful.)
Yes, the rise of the Internet meant it was time to change how we did cab dispatch. And it would have been great to see what else we could improve, including getting the cab companies to be less oligopolistic. But Uber was clearly after a monopoly [1] so Kalanick could jack rates up enough to justify the billions of investment they took. But national monopolies are way more harmful to both workers and customers than local, strongly regulated oligopolies. Uber was ultimately trying to make things worse, but with them skimming the monopoly rents.
[1] https://www.amazon.com/Super-Pumped-Battle-Mike-Isaac/dp/039...
It's better to have two parties competing for user's money than just one party fixing the price and service quality.
> Unfortunately, this seems to be the only way that's not outright massive violence such as Hongkong or France to get politicians to do their goddamn job. Taxi services have had a really massive lobby power in the US.
This was strongly implying that Uber was causing political change. I don't disagree that the competition has been healthy or that the taxi companies were bad actors - or even that the regulations were legitimately onerous sometimes... I object to the statement that "disruption = positive social change".
I think that Uber's case is particularly weak because, while skirting regulation may have gotten accolades, the company itself was toxic to work at and brought in a bevy of sexual harassment charges.
by and large consumers don't care if the company is for social change or not.
it's difficult for a company to succeed in getting customers to pay based purely on social change intentions. That's how a market works
The wonderful board room scene:
They borrowed short, lent long and then pretended it was as sustainable business. To their credit, they abundantly disclosed their shenanigans. (I haven't seen any evidence suggesting investors can reasonably claim fraud.) But they were playing fast and loose with basic economics.
At its core, sure, WeWork could have been a business. Its thesis, that office space should be treated as a service versus capital expense, is plausible. But there was so much garbage--the party-at-work hypothesis, thoughtless cross-selling, nepotism, consciousness nonsense, self-dealing, et cetera--that the value got diluted while the price was pumped.
SoftBank and Masayoshi Son's hypothesis is:
1. Find a market which can be captured by a business with access to massive capital
2. Provide massive capital
3. Extract profits once a monopoly has been established
WeWork is a terrible example of this, because in no way does scale give them unique advantages. And furthermore, "scale" in this context means "scale in the office property market" -- that's a pretty big pool to expect to overflow.
I run a small digital agency, as a WeWork member when I'm on the road being able to know I can find and book space for meetings or work is invaluable. We've also spun up offices in new cities (Mexico City for us) easily and quickly with a confidence in the level of service and support that we're getting.
There is a premium for this and we've moved on from those offices sometimes as we settle in. But its not a non-existent advantage.
Within the original thesis per se it gave them a possible demand-side advantage. (Commercial real estate is too big for any meaningful sell-side advantages.)
Being able to say "let's open a branch in Singapore and see how it goes for 6 months" with a few clicks is quite awesome. If I trusted it to be around in a few years, it would change how I think about deploying people.
To be able to deliver that value prop, you need seats available in Singapore. (And New York and London and Dubai.) Hence a potential scaling advantage.
I'd have thought that for most businesses, the two big obstacles for doing this are a) getting skilled people to suddenly move to Singapore at your will, and b) getting the Singapore office well integrated with the rest of the company.
Compared to those two, setting up an office lease is about as hard as tying your shoelaces.
This has not been my experience. Given how localized real estate markets are, they haven't been subjected to efficiency-driving global competition. The result is every market has hidden oddities. Little details that are a nuisance if you know about them but a disaster if you bumble through the process.
For long-term commitments to a market, sure, it makes sense to own your plot. But for short-term assignments? Toes in the water? Being able to spin up an office with flown-in staff committed to for the short-term, to develop leads and/or find those skilled locals to hire, is a tactical advantage which doesn't presently exist.
Uber's product isn't rides. Uber's product is being the market-maker between riders and drivers.
Austin has a non-profit rideshare business that matches riders and drivers.
You've just described almost every company in the financial sector.
They do have some scale, and there's always the idea that you can move to a different office or reconfigure your space quickly. This has real value. Just not $50 billion worth.
Matt Stoller wrote a great post about it:
https://mattstoller.substack.com/p/wework-and-counterfeit-ca...
"Generally speaking, Softbank’s model is to manipulate private capital markets as a way of drowning out competitors with cash. For instance, there were several ‘rounds’ of WeWork investment where Softbank was buying more shares at higher valuations. WeWork ostensibly became more valuable because Son said it was more valuable, and bought shares for higher prices. And since there was no public market for these shares, the pricing of the shares was totally arbitrary. WeWork then used this cash to underprice competitors in the co-working space market, hoping to be able to profit later once it had a strong market position in real estate subletting or ancillary businesses.
Engaging in such a strategy used to be illegal, and was known as predatory pricing. There are laws, like Robinson-Patman and the Clayton Act, which, if read properly and enforced, prohibit such conduct. The reason is very basic to capitalism. Capitalism works because companies that thrive take a bunch of inputs and create a product that is more valuable than the sum of its parts. That creates additional value, and in such a model companies have to compete by making better goods and services.
What predatory pricing does is to enable competition purely based on access to capital. Someone like Neumann, and Son’s entire model with his Vision Fund, is to take inputs, combine them into products worth less than their cost, and plug up the deficit through the capital markets in hopes of acquiring market power later or of just self-dealing so the losses are placed onto someone else."
No evidence of fraud, no. But cheating is not necessarily fraud because not all rules are codified as law. There is cleverly devious cheating, like a lot of what Gates and Jobs did in the 80s. That's cheating, but it's clever and it's cute so we think of it positively.
Then there's cheating as in pretending to defy the laws of economics, which is what WeWork did. They were trying to scale out of a business that loses money on the marginal dollar. Nothing illegal about that. But together with Masa Son's spigot of Saudi cash and Neumann's rampant self dealing, I'd go ahead and qualify it as cheating.
WeWork's revenues already cover its rent costs even at just 70% occupancy.
I still don't see this "cheating" you speak of.
The social focus is indeed different but I wouldn't call that alone a massive paradigm shift.
-Margin Call
SV ran out of the first two because they are much harder. We are left with the dying gasps of companies trying the third way.