A company must be profitable to be socially and economically sustainable. How long profitability takes depends on several factors; typically, a lack of access to capital is a fundamental barrier, but not for Uber. Since 2009, Uber has burned through billions and in 2023, it is making a profit based on the initial proposition, a ride-hailing app.
Uber has seen some profit through acquisitions like Lime Scooters and Post Mates, launching Uber Eats and UberX Share. However, the idea that attracted investors, disrupted industries and burned through billions took 14 years to make a profit.
What does this have to do with Economic sustainability?
The Good
- Uber is the primary and secondary income for millions of people around the world.
- Uber's focus on advertising and brand partnerships supports downstream growth and activities in the supply chain
- Uber's acquisition approach with Lime Scooter, Uber Eats, Post Mates and others sustains profit and enables economies of scale for those entities
The Controversy
- Uber demonstrates that investors will invest in a "founder type" regardless of how much money it costs.
- 1% of the billions invested in Uber could have been reallocated to 0.01% of underrepresented Founders that get VC funding, and it may not have taken them 14 years to turn a profit.
- When Uber entered a new market, it created competition by driving the price down and, in doing so, controlled the market. It is good for business but not economically sustainable.
If competition creates a commercial advantage, should Uber and other companies be concerned with economic sustainability?