OPPORTUNITY NAME:
Uber
DATE LAUNCHED:
2009
FOUNDERS:
Travis Kalanick and Garrett Camp
ABOUT THE FOUNDERS/COMPANY:
Uber is a ridesharing/transportation and mobile food-delivery app owned by Uber Technologies, Inc. Uber Technologies also founded and owns Uber’s Advanced Technologies Center, a scientific research company dedicated to creating self-driving cars, with the goal of one day using these cars as part of its Uber transportation services.
Uber was first founded in 2009. The two business partners were already successful entrepreneurs and e-businessmen before coming together to form Uber. Kalanick was previously the founder of Red Swoosh, a peer-to-peer file-sharing company who later sold the startup for $19 million. Camp was a co-founder of StumbleUpon, a content-discovery search engine.
Uber’s Premise
The premise behind Uber was the brainchild of Camp, who had pooled with friends to hire a private driver one New Year’s Eve to the tune of $800. It got him thinking about the need for affordable black car services. Sharing the cost of a private ride seemed like an economical way to travel, and he wanted to expand on the idea, making it available and viable to the public-at-large. The then-called UberCab mobile app officially launched in the company’s headquarters of San Francisco in 2011. At the time, the only transportation available was in the luxury category and drivers were hired privately by Uber.
UberX
In 2012, the company expanded on the idea and created UberX, a service where a private individual could use his or her own car to transport members of the public wanting a ride to a local destination. Next, it introduced UberPOOL in 2014, which was targeted at commuters. It matched drivers with riders traveling in the same direction.
Since 2015, the company has been testing self-driving cars for a select few routes with the hope of having an entire fleet of self-driving vehicles in multiple cities in the future. The testing has met with a variety of opposition due to safety concerns. The company experienced one accident with one of its self-driving cars due to a violation on the part of another driver.
Uber’s Expansion
Since it first began operating in San Francisco, Uber has since expanded to more than 700 cities in 80 different countries across the globe. Its expansion was met with controversy and opposition in many cities in North America, largely by the taxi industry. Uber threatened to take away a share of taxi profits but were not subject to the same kind of stringent regulations that govern taxi companies, vehicles and drivers. Many cities have since developed rules and laws under which Uber must operate in those regions in order to ensure public safety and preservation of the taxi industry.
WORKING FOR UBER – HOW IT WORKS:
Working for Uber involves using your own private vehicle to pick people up and drive them to their destinations so you get paid to drive. Uber drivers operate as independent contractors for the company (rather than employees). Application to become a driver is open to any individual who meets the age requirement in the city in which they will be operating. For most US cities, this is 21, but in some places it may be up to 23years old.
Prospective drivers must also:
- Have at least three years of driving experience
- Have a clean driving record
- Have no history of driving under the influence of alcohol or drugs
- Must have no history of fatal car accidents
- Vehicle must meet current age requirements (usually meaning that the vehicle must be less than 20 years old)
- Vehicle must seat at least four passengers not including the driver
- Vehicle must have four doors
- Vehicle cannot be a marked taxi
- Cannot be a salvaged vehicle
- Vehicle must have in-state license plates and car insurance in the driver’s name
These are the basic general driver and vehicle requirements. There are others regarding maintenance of the vehicle, etc. There may also be requirements that are specific to a particular city or state of operation, and these requirements can differ from state to state and city to city. These regulations are often updated, so it’s important to directly consult www.Uber.com for the most current regulations. However, it is generally safe to say that if you are older than 21 (or 23, where required), have a newer vehicle and have a clean driving record, you can probably meet all of the qualifications for becoming an Uber driver.
How Uber Works for Passengers
To ride with Uber, a passenger must first download the Uber app to their smartphone. To request a ride, a user must open the app and tap to request a ride to their destination.
Using the GPS locator on the user’s smartphone, the Uber app figures out where the rider are on the map and pinpoints his or her destination, then calculates the potential fare based on the distance between where the rider is are and where he wants to go. It then locates a driver who is in the area and able to pick him or her up and gives an estimated wait time to be picked up by the driver. If the rider is happy with the wait time and fare, he or she must accept the ride, and the app automatically charges the fare to the rider’s account account, which must be connected to a valid credit card or bank account in order to be eligible for a ride. Riders are also given the option to add a tip to their cost, but tips are not mandatory.
The driver will arrive and pick up the rider. Because the rider’s account has already been charged, there is no actual exchange of money between the driver and the passenger. Once the driver has reached the rider’s destination, the rider is dropped off and then asked by the Uber app to rate the driver on a scale of one to five stars.
How Uber Works for Drivers
As a driver, you will be the one on the other end of the transaction that is initiated when a rider requests a pickup. Uber drivers are issued their own Uber driver app. This is how Uber pinpoints your current location when you are actively working and connects you with riders in your area. When someone requests a ride through their app, it will show up on your app’s map. It will let you know about how long it will take you to get to the rider, where they want to go, and what the estimated total fare will be. It is up to you whether you want to pick up a particular rider, but if you do want to take the request, you tap the location to accept.
Once you’ve accepted the passenger, the app will provide you with directions on how to get to their location. It usually provides you with the most direct/quickest route, but may also offer alternative routes in case of heavy traffic or other obstacles. When you arrive at the rider’s location, Uber will have already charged the rider his or her fare. You need only to tap the app to indicate that you’ve arrived and that you have picked up your passenger. Next, you’ll be provided with directions to get to the rider’s destination.
When you get there, you tap the app to indicate that you have arrived at the destination and that you have dropped him or her off. You will then be asked to rate the rider in the same manner the rider is asked to rate you.
The rating system is important for two major reasons. First, if you are consistently rated by riders at fewer than three stars, you may not be allowed to continue driving for Uber. Therefore, it’s important to act professionally, drive carefully and obey traffic laws, and treat your customers respectfully. Some Uber drivers throw in something “extra” for their passengers in a bid to elicit higher ratings, like handing out chocolates or playing a rider’s favorite kind of music.
By the same token, it is important that you be honest and objective when you rate your passengers. Riders with consistently low ratings may have their Uber service discontinued. It is Uber’s way of respecting and retaining its drivers as well as keeping them safe from unruly or abusive riders.
How Rider Fares are Calculated
If you’re wondering how much money you can potentially make as an Uber driver, it’s a difficult question to answer. This is because, as a driver, you always make a percentage of the total fare, which is about 75% (depending on where you are working). However, the total fare depends on how long a particular route is. The fares charged to passengers can also change depending on the time of day as well as what the demand is for drivers at any given time. Therefore, it’s possible that the fare in a given city at 3:00 on a Friday afternoon going from point A to point B may actually be different at the exact same time the next Friday afternoon for the same route, due simply to higher or lower demand for rides. For this reason, it’s hard for drivers to predict their income or count on, making a certain amount of money.
While this is bothersome to some Uber drivers and potential drivers, others appreciate this system because it encourages drivers to work when demand is greater, like during rush hour or at 2:00 in the morning when bars are closing for the night, because they may end up making more money by way of either increased fares or more riders requesting rides.
What’s the Deal with Fluctuating Uber Fares?
When a rider requests a pickup, Uber lets the passenger know what the “upfront” charge will be. This fee includes a base fare, the price at which all fares begin at (they do not start at zero, and base fares may differ from region to region). The ride fare is calculated based on the distance and estimated time from the pickup point to the rider’s destination. To this will be added other incidentals that may be unique to a rider’s requested route, such as bridge tolls. There is also a small booking fee, which is added on and paid to the driver as compensation for insurance and vehicle wear and tear.
Perhaps you’ve heard some of the media reports of Uber users complaining about fares changing mid-ride and catching them unawares. Yes, it’s true that the fare provided to the passenger (and to you as the driver before you pick up the rider) can sometimes change mid-ride. The main reason that this occurs is because the passenger decides at some point during the ride to request a different destination, a different route, or to make temporary stops before the final destination. Your Uber driver app, via your GPS locator, picks up on these changes and adjusts the fare accordingly. Therefore, it is possible that the rider may see a bigger charge at the end of the ride than he or she expected.
Do I Get Paid as an Uber Driver?
Uber keeps approximately 25 percent of any given fare for itself. (Again, as things change periodically or from state to state, check directly with the Uber website for the most up-to-date, accurate percentage.) You will receive the remainder of the fare, the booking fee and full reimbursement for tolls (if any). So in other words, if you take a rider from point A to point B and drive over a toll bridge that charges $2.00, and the fare ends up being $34.76, which is added to the initial booking fee of $1.95, the total you will receive after Uber takes 25 percent of the $34.76 fare is $26.07, plus you will receive the $1.95 booking fee and a reimbursement for the toll. This means that, altogether, you’ll be paid $30.02 for that ride.
Uber drivers are paid on a weekly basis via direct deposit into the bank account of their choice. The week begins at 4:00 pm on Monday and ends at 3:59 pm the following Monday. All fares collected during that period are calculated and deposited into the Uber driver’s bank account on the following Thursday. (Please note that things may have changed since this posting, so consult the Uber Website for the most up-to-date info.)
DRIVERS WORKING FOR UBER WHO POSTED AN UBER REVIEW:
We looked at other Uber reviews because we wanted to see what other Uber drivers are saying about what their experiences have been doing this work. First we checked with Glassdoor.com, a review Website where members of the public can rate and discuss their experiences working for different businesses. On this forum, driving for Uber has an average of three out of five stars as rated by Uber drivers (current and former) who left Uber reviews.
The biggest positive Uber review listed by Uber drivers include:
“I get to meet people from all over the world.”
“Flexible…. you can work whenever you want.”
The most frequent negative Uber review as reported by users include:
“Work/life balance is it’s selling point but it’s not always like that.”
“Lots of wear and tear on your own personal vehicle.”
A Chicago Uber driver left an Uber review which states that the work and, therefore, the pay is “very up and down” and adds that “if you can figure out how to work the surge [the fluctuations referenced earlier] you can make a lot of money.” However, the driver also says that there are a lot of lulls during the day where you get few or no pickup notices. This user gave driving for Uber three out of five stars.
A Minnesota Uber driver left an Uber review and rated his experience five out of five stars felt that, in his own experience, there weren’t many “cons” to the job, other than picking up drunk passengers who get rowdy, damage the vehicle or get sick during their ride. (Note: cleaning up vomit is a definite possibility in this job so be prepared.) What this driver really enjoys about the job is that he has had the opportunity to meet so many different kinds of people from all over the US and the world.
An Uber review from a driver who is working in Atlanta, Georgia rates his experience four out of five stars. His favorite thing about the job is engaging with the passengers and meeting so many different people. What he likes the least about the job is sitting around and waiting for pickup notices which is both boring and unprofitable.
We also checked with Indeed.com, another site where visitors can rate their experiences working with various companies and a place to post an Uber review. On this site from users who posted an Uber review, Uber has an average ranking of 4.5 out of 5 stars as designated by Uber drivers. An Ohio driver who posted an Uber review and who rated her experience three out of five stars notes that, since you must have commercial insurance on your vehicle (which can be expensive), it eats into your profits considerably. You might have to drive a lot to justify the extra expenditure of specialized insurance.
A Boulder, Colorado Uber driver posted their Uber review and rated his experience five out of five stars and states that “It’s a great job for someone who just wants to make extra cash on weekends. You can turn it on and off whenever you want and it pays great.” He does concede that there is incidental wear and tear on his vehicle, but in his experience the earnings he has been able to make is enough to cover it.
One Dallas, TX Uber driver who posted an Uber review rated her experience four out of five stars feels that it’s a good job to have. However, she admits “Sometimes it gets slow and the gas adds up.” An Ohio driver is not quite as happy with driving for Uber, calling it a “scam” and designating one out of five stars. His Uber review stated that he felt that the pay he was able to generate was not worth the wear and tear on his car, nor did it adequately cover the price of gasoline.
OUR UBER REVIEW VERDICT – IS WORKING FOR UBER WORTH IT?
In all of the research we conducted, it appeared that most Uber drivers who posted an Uber review felt like the experience was worth either three or four stars. There weren’t many five-star ratings, and there were very few one and two star ratings. The variations between the five star ratings and the one or two star ratings may be due to factors such as driving a newer car versus an older car, driving a gas-efficient compact car versus a gas guzzling mid or large-size vehicle, the population of the cities where drivers worked (which may affect the number pickup requests), the constantly fluctuating price of gas and that fact gasoline is cheaper in some places than others, and the times of day that drivers chose to work (i.e. choosing to work on a Monday afternoon as opposed to working on a late Friday night or weekend day).
We tried to take all of these possible differences into account in this Uber review in making our final judgment. The fact that Uber has a good reputation (even in spite of its fluctuating prices that sometimes take riders by surprise) is something we feel is good for anyone considering working for Uber. The company has detailed policies designed to inform, protect and motivate drivers to work for them. They have a reliable system for paying drivers, and you get paid weekly so you don’t have to wait weeks or a month to have cash in your pocket.
We would caution anyone considering working for Uber to remember that vehicle wear and tear is a part of this job and should be expected, as should fuel costs, especially as prices can sometimes fluctuate wildly and with little warning. Additionally, if your vehicle is a gas-guzzler, you may find that your profits may not be worth your time or the wear and tear on your vehicle.
With all that said, we feel confident in recommending that, if you have ever thought of working for Uber, just give it a try. The fact that you can set your own hours, don’t have to ask anyone for vacation time, or you don’t have to drive at all if fuel prices shoot up makes this job something that you should at least try. You don’t really have much to lose by giving it, say, a month or two to see if it’s worth your time. If not, you’re not obligated to stay. If you find you’re actually making good money, you’ll have extra pocket cash. Just don’t expect to make a living working for Uber.
GREEN BADGE
RECOMMENDED
RELIABLE SYSTEM AND YOU GET PAID WEEKLY
VEHICLE WEAR AND TEAR
(Learn more about our rating guidelines.)
