Re:DoorDash to Slash 1,250 Jobs to Pare Back Rising Costs
by seanhunter on Wednesday November 30, 2022 @04:55PM
(#33808372)
Literally no-one is assuming that average unit economics apply to every transaction.
Re:DoorDash to Slash 1,250 Jobs to Pare Back Rising Costs
by RC_ITR on Wednesday November 30, 2022 @06:24PM
(#33809529)
Read up the thread my guy.
>Gonna be very unpopular here, but the sooner gig companies like Uber and DoorDash collapse, the better. The business model of these so-called unicorns is effectively a Ponzi scheme where the end goal is for early investors to cash out with the IPO. However, unlike a Ponzi, these companies also rip off their contractors so most restaurants and drivers actually lose money by being involved with their "service". Straight-up middlemen who skim off the top behind a veneer of tech that can't even turn in a profit. Build a real business. If you can't be profitable without eliminating all the competition by first undercutting them, then jacking up prices on users, then you shouldn't exist
[Edited the last sentence for punctuation]
People show average unit economics and people assume that the average applied to every transaction, when it is actually a distribution.
Expanding into new segments and markets almost always leads to temporary negative unit economics, but that's just what growth looks like.
The trick is to not take that too far and enter markets/segments with unit economics that will never be positive (like on-demand dog walking)