Today, autonomous trucks are hauling butter down U.S. interstates. Robo-deliverers are slinging pizza to urban dwellers. And from Detroit to Beijing to Bavarian boardrooms, electrification is the buzzword.
A decade ago, our transportation landscape didn’t look like this. Let’s break down how we got here, with a special focus on the underlying technology.
Tap a button, get a ride
Smartphones and fast 4G connections powered the mobile app economy of the 2010s. Look no further than Uber, which leveraged the tech to popularize ride-hailing.
- The first Uber rider hailed a trip in SF on July 5, 2010. The service hit 1 billion rides in 2015, 5 billion two years later, and 10 billion in June 2018.
- Now, its market cap tops Ford’s by more than $10 billion.
While that was happening, hundreds more transportation software players entered the scrum. In the last few years, several Uber alumni have started their own companies, including one that offers ride-hailing software as a service.
Today, these companies sell for-hire rides, on-demand rentals, shared vehicle access, food delivery...
...and micrombility
You didn’t think I’d forget e-bike and e-scooter sharing, did you? Over the last two decades, rental bikes flooded China's city streets by the millions. Startups that offered these on-demand bike services took advantage of cheap capital, the country’s manufacturing prowess, and rising demand.
Well, that bike-sharing craze turned out to be a bubble. But from the ashes emerged a vibrant global micromobility industry.
- In 2017, e-scooters started popping up in cities around the world like they were dropped out of the sky. And in 2018, U.S. startups Bird and Lime became unicorns.
- These scooters pack sensors, GPS, lithium-ion batteries, and electric motors. And of course, all you need to ride is a smartphone.
But it’s not all peachy
City and state officials have flexed their muscles over these companies, via taxes and permit caps. And critics say software-based transportation companies rely on armies of gig workers with algorithmic bosses, poor pay, and little to no benefits. And from a profit POV, nearly all of these startups (and publicly traded companies) are still loss-making.
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Uber, which wants to integrate as many transportation services and modalities as possible into one mobility superapp, is scaling back by laying off employees and selling non-core businesses. SoftBank, which has cut lavish checks to mobility startups, is also facing a reckoning.
Bottom line: On the software side, powerful smartphones and AI let transportation as a service companies scale their marketplaces. But after years of unchecked growth, they’re pivoting to profitability. The field may be consolidating, but ride-hailing and micromobility aren’t going away.