Uber flawed business model? Why then it’s worth billions in market capitalization and going for IPO soon?
Uber’s IPO Prospectus
Translated in a Financial Times comment. Obfuscation and jargon removed
We don’t make money.
We probably will never make money.
Our current business relies on shareholders to fund cheap cab rides in the hope that regulators will let us become a monopoly and charge whatever we want. But regulators aren’t playing along.
We have therefore spent more money expanding into other low margin highly competitive businesses like food delivery or trucking, despite there being lots of specialist logistics firms. So, it’s not very obvious to us how we are going to make any money there either.
We hope in the future there will be driverless cars and that we can then make money. But other people are developing them too.
We have annoyed lots of regulators so we have lots of disputes and problems with regulators everywhere.
We don’t pay much tax, and have done lots of aggressive tax planning, and so we have lots of disputes with tax authorities too.
We don’t employ anyone (or, we say we don’t!) but we have lots of de facto employees. And so, we have lots of disputes and problems with drivers and employment tribunals.
We don’t actually own many assets because we managed to get our drivers to provide their own cars.
We have an app but other cab companies also have apps.
Current investors want to get out and so we hope you will buy some shares anyway because you have heard of us. Also, we need more money to fund the businesses that don’t make money.
We are expanding into more business lines that don’t make money, and we need more money to fund those.
We are really big and you have heard of us. Plus, we say we are a tech disruptor so don’t worry that we make no money. It will all be great because you will be an Uber investor.