> What's with all the people that talk or even brag about how much money they make doing ridesharing, food delivery, etc?
Got any examples?
I can think of a few possibilities:
1. I wouldn't put it past a company like Uber to pay to produce propaganda where someone lies about much money you can make driving for them. After all, a steady surplus of naive and enthusiastic drivers is essential to their business model.
2. You might have some schmuck doing that for the for free, by trying to brag about themselves as personally successful on social media (either for ego reasons or just trying to get clicks).
3. I think a lot of the drivers are "misinformed, bad at math." I've read it's pretty common for casual drivers to be totally ignorant of some of the major costs they're paying indirectly (e.g. not factoring in the wear and tear on their car or (more egregiously) fuel costs).
4. Being a rideshare/food delivery driver may be profitable if you're really savvy and have unusual advantages (like you live near a stadium and only drive after a baseball game during maximum surge pricing).
Likely they don't calculate how much they are making after expenses or don't understand how expenses work.
For example, a reddit post I read a little while ago (can't find it again) the person said they do ride sharing so got to take a lot of deductions on their taxes so they said "on paper" it "looks like" they make "much less" than they "actually" do.
The comments rightly pointed out the poster's "on paper" income is their actual income, because they are deducting expenses they paid and it wasn't an accounting trick.
There could be some truth to this based on the vehicle you drive.
The IRS gives a flat per-mile deduction, which is an estimate of fuel, repair, maintenance, and depreciation costs. If your actual vehicle expenses are lower, then you are making more money than your taxable income.
Sure, you might be ahead a bit more than "on paper" but you still have significant expenses that were actually accrued. The context of this post was the person thought their "actual" salary didn't include their (significant) expenses and being eligible for deductions was just a bonus. They argued in the comments their salary was "really" their pre-deduction salary, I guess because that's what went into their bank account.
They were also asking if they should just stop taking these deductions for a few years for some reason (I think to qualify for a mortgage), so they weren't exactly understanding finance.
I wish I could find the post again, it was baffling.
> you still have significant expenses that were actually accrued
It really depends on the numbers. If you're savvy, 1099 income lets you deduct quite aggressively, and I can see the IRS not really caring about delivery drivers' income.
I worked deliveries a long time ago, before the age of food order apps, but at least at the time pretty much all drivers calculated their pay without considering expenses. It can easily be 30% of your pretax take-home, but the cost is mostly hidden until your car breaks, your tires wear, or you need to sell your car.
Have you ever seen an instagram post where someone flashes wealth they don’t truly have? Be it a rented Lamborghini or a stack of twenty dollar dolls? Or a stack of ones with a couple hundred obfuscating the other denominations?
There are more incentives to flaunt success then bankruptcy. Even if the success isn’t real.
Most of them are bad at math because they ignore a lot of variables like wear and tear on their vehicles and the fact that their car insurance doesn't cover them using their private vehicle for commercial purposes. It's one of those things that profitable in the short-term but only if you ignore long term costs. Granted some people might have somewhat legitimate reasons for ignoring those costs or may have made some cost benefit analysis in which it makes sense for them, but overall it tends to be a net negative if you actually include all of the costs.
Pretty sure it's becoming increasingly common that one person runs a fleet of drivers that they have imported from a foreign country. The primary person sets up all the accounts, and provides the cars, etc and the drivers do the deliveries and get paid a minuscule amount. In many cases they're akin to indentured servants that also live in packed housing owned by the "boss", to whom they also pay rent. The workers get their tiny sliver of money and send it home to help out their families, with the hope they can eventually establish themselves in the US.
how are they not making more money off of data? the trip data alone has to be worth millions right? All I see when discussing Ubers profits is the cost of trips and the cost of drivers and how much they spend on marketing and politicians. It seems like theres gaping black hole of all the data they are collecting and it being put to use/sale.
There's a fairly common belief that "selling data" is a money-printing business, but it generally isn't.
Specifically, data is only worth as much as the buyer is able to exploit it to make money. Meta and Google have figured out how to immensely profit off of personal data - but that's because they own the largest ad networks on the planet.
Few other players can leverage personal data to this financial extent. More importantly, the players that can leverage personal data for immense profit also collect their own data, and so externally-sourced data is only of marginal utility.
And you see this in the discourse around this issue. We theorize for example that some grocery chain would "pay a lot" for personal data. But to what end? So they can offer just-in-time enticements to go to the store?
A lot of these supposed "applications" of personal data seem pretty flimsy, and even where they are genuinely useful, their monetary worth is marginal.
Data is worth something, but it isn't worth nearly as much as widely believed.
Personal data just isn't worth that much. You sometimes see people run around with high estimates where, like, Google's entire advertising revenue is attributed to personal data. But Uber doesn't run a massively popular advertising network, so even if that's a fair attribution it's not available to them.
It's easy to say that data is immensely valuable, but mostly it isn't. How personalized are the ads you see on the web, really? What's the ratio of times you clicked on an ad accidentally or got tricked into clicking an ad (ever had the layout change on Anandtech just before you tried to click on a link?)
I used to work for a company that helped other companies decide where to place stores. Circa 2007 we were thinking about it from the viewpoint of trips and I'd developed a touchscreen kiosk that would get visitors to a Dairy Queen to tell us where they came from and where they were going. We believed that people didn't just go to a fast food restaurant that was convenient to their home but that they were driving from point A to point B and happen to stop at a restaurant along the way so a "good location" had a kind of centrality where it was on many such paths.
(The project was ill fated. The kiosk we selected was rather expensive, particularly for a project we'd sold to one franchisee. Our partner dumped us because he thought he could get cheaper kiosks, we brought in our lawyers, as ahead of its time as it was, we never got put the kiosk app in front of customers.)
On one level it's a good idea, but what is the data really worth? Chains that work hard at picking good locations find their competitors follow them and set up shop across the street. The value of the data is based on the amount of lift you can get using it relative to the alternatives. People often wind up choosing locations for other reasons such as Duane Reade who were geniuses at finding sites they could afford in the NYC real estate market.
I believe Grubhub was profitable for years before they started offering their own delivery and had to compete with money losing companies like Uber and DoorDash.
Dev is not why they are unprofitable. It is mainly due to COGS (payout to drivers and other direct costs) & sales and marketing aka growth at all cost. Their revenue has not gone down
Has this changed? Do all these companies still losing money?