Musings on Markets · 2016-08-17 · 3578d

Ride Sharing Business Analysis: Market Maturation and Profitability Challenges

The article analyzes the ride-sharing industry's rapid growth and global expansion while highlighting a critical flaw: despite raising capital at high valuations, companies are burning cash unsustainably. The author questions whether the industry is approaching a 'Bar Mitzvah moment' (maturation) and examines four possible evolutionary paths for the business model.

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Metrics in this report

Chicago Taxi Medallion Price

$357,000 to $60,000$

2013 peak to July 2016

Chicago medallions

Didi Chuxing Annual Rides

1.43 billionrides

2015 annual

China market

Didi Chuxing User Base

250 millionusers

active users across cities

China market

Didi Chuxing Valuation

$28,000 million$

most recent funding round

Apple, Alibaba, Softbank investment

Lyft Monthly Cash Burn

$50 million$

monthly estimate

US operations

NYC Taxi Medallion Price

$1.5 million to $500,000$

pre-disruption to March 2016

New York City medallions

US Ride-Sharing Adoption

8.2 to 20.4 millionusers

2014-2020 projection

United States market

US Ride-Sharing User Penetration

3.4% to 7.8%% of US adult population

2014-2020 projection

United States market

Uber Cash Burn

> $1 billion$

2015 annual

Global operations

Uber Valuation

$62,500 million$

most recent funding round

Saudi Arabian Sovereign Fund investment