Uber’s great success attracting quality drivers rests squarely in leveraging man’s two core natural rights. Uber drivers can 1) exercise much more free choice in their profession and 2) own 70% more of the fruits of their labor than the legacy highly regulated and controlled tax service model. UberX Customers are rewarded with 50% reduction in transportation costs, faster service, and simple electronic payment with tips included. That’s a winning business model.
Here’s my UberX value proposition today from San Jose Airport to Silicon Valley.
1. Found the driver in his brand new Prius at airport curbside within 1 minute of ordering the service.
2. Paid 50% less door to door than my legacy car service, 60% including legacy tip.
My driver value proposition: Before Uber, he spent 15 years driving a Yellow Cab.
+ $1000 gross revenue in a good week
– $540 dispatch service fee to Yellow Cab
– $15/week in bi-annual driver re-certifications
– $20/week/city he wishes to serve (10 cities at $100/year/city/52 weeks)
= @$425/week net income to driver
Yellow Cab would also dictate his vacation schedule and charge him $1,000 for every extra vacation he took beyond 3.
UberX value proposition:
1. $750 net income after paying 20% of income to Uber. 76% weekly pay increase!!
2. Uber sets up drivers in one-day (on-site) and one week in on-line application after background check. They provide drivers an Uber phone with $300 deposit, which driver pays back from income.
3. The driver turns off his Uber phone and he’s immediately on vacation. He turns it back on and is in full control of his productive output.
Uber even leverages one of the five rules of evolutionary cooperation called ‘direct reciprocity’ into their customer value proposition. They call it: ‘Give a Ride, Get a Ride’. If any of you loyal Ownership Society followers sign up for Uber and use my referral code: f909u, you get a free first ride! And after your first free ride, I receive a free ride. Beautiful win-win. See OS Post. Evolution of an Ownership Society: 5 Rules of Cooperation. More relevant post links below.
Like Uber drivers, all workers need more ownership in their labor and greater freedom to choose how they work. Here are several earlier OS posts on this subject.
1. Making sure workers have ownership in their labor
2. Solving minimum wage with earned income expansion
3. Creating more asset owners to minimize income inequality
4. Direct reciprocity is the answer to Pope Francis’ concern on income inequality
5. Solve income inequality by expanding fiscal policies that work