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The middle.
Gig companies talk a lot about the ‘first mile’ and ‘last mile.’ In ride-hail or mobility the first and last mile is that portion of a trip that often isn’t served well by public transport, for example, the journey from your home to the commuter train you take to work. E-bike and e-scooter companies tend to focus on the first and last mile because it’s low-hanging fruit for replacing car journeys.
The terms have slightly different connotations in logistics: ‘first mile’ describes the movement of products from a factory or production center to a warehouse and ‘last mile’ is the final movement of goods to consumers (e.g. from a store to a home). We tend to hear less about the ‘middle mile,’ but it’s also important. The middle mile is generally the step in a supply chain where goods move from a warehouse or distribution center to a retail store. This step is largely invisible to consumers, but essential to keeping shelves stocked and supply fresh, especially in an industry like grocery where a lot of the goods are perishable and temperature-sensitive.
Most gig companies that do grocery tend to focus on the last mile—getting stuff from shelves to consumers. Uber Eats, for instance, delivers from convenience stores and Instacart has shoppers who gather items from supermarket shelves and bring them to people’s homes. So it’s interesting to see Via, a former ride-hail player, taking a different approach in a new deal with Israeli supermarket chain Shufersal, which will use Via’s software to improve its middle-mile movement of goods from distribution centers to more than 300 locations across Israel.
The Shufersal deal is the first big grocery partnership for Via, which in recent years has undergone a broader evolution from an operator of shared consumer rides to a provider of transit and logistics software. Via, founded in 2012, was always more interested in developing transit services for public authorities, but it also ran a consumer ride-hail service in a handful of cities to keep pace with Uber and Lyft. In New York City, Via offered only shared rides and stood out for paying the highest hourly wages to drivers in a 2018 study of driver pay commissioned by the city.
Via shut down its remaining ride-hail services in New York and Washington D.C. in December 2021 to focus on selling software to mass transit providers. That means building apps and software that let transit agencies offer many of the benefits of ride-hail, such as pre-bookings, real-time schedules, and dynamic routes and dispatch. Revenue from these services comes from long-term contracts that make it more predictable, CEO Daniel Ramot told Bloomberg, citing an annual run rate of over $100 million in 2021. Via raised a $130 million series G round in November 2021 at $3.3 billion valuation and filed confidentially to go public in December.
Via now brands itself a “TransitTech” company to emphasize its shift into software and away from consumer ride-hail. I will say that while I think we could just call Via a transit company, on the scale of corporate jargon I much prefer “TransitTech” to the dreaded transit- or mobility- “as a service” formulation. There are enough bad acronyms in the world without TaaS or MaaS.
Taxis.
We talked recently about Uber’s plan to “put every taxi on Uber by 2025,” starting with New York City’s 13,587 yellow cabs. Next up is San Francisco, where Uber will soon bring cabs into its app through a deal with Yellow Cab SF and Flywheel Technologies that was approved last week by the city’s transportation board.
As with the New York City deal, taxi rides through Uber will reportedly cost the same as UberX rides. Taxi drivers will see their pay for an Uber ride ahead of time and be able to accept or reject the trips without consequences. It looks like a win-win: taxi drivers get more choice, which is generally a good thing, and Uber increases its supply of drivers, which has been strained since the pandemic, leading to longer wait times and higher prices. Flywheel is also a good get for Uber as it provides ride-hail technology to 30,000 cabs in more than 50 cities in the U.S. and Canada, which is a lot more than the 425 cabs it has in San Francisco. Flywheel CEO Hansu Kim told the San Francisco Chronicle that Flywheel will integrate with Uber in other cities in the coming months.
Taxi drivers are more skeptical, per SFGate:
“I’m concerned about the lack of transparency and I’m sad they haven’t worked out all the rules before putting them into effect,” said Barry Taranto, a cab driver and member of the SFTWA. “Working with a company that exploits workers is a huge problem. If they treat their own drivers poorly, imagine how they’ll treat us.”
And:
During public comment, Benjamin Valis, a taxi driver for Veterans Cab, decried how certain rules of the program were not yet finalized and could come at the cost of his livelihood. “If you believe in a living wage in San Francisco, make this work at taxi meter rates,” he said.
Here’s the thing: Just because Uber wants to team up with taxis doesn’t mean taxi drivers want to team up with Uber. The trouble is that many still view Uber with suspicion and dislike after Uber spent the better part of a decade denigrating and decimating their industry, which is fair! It’s like if the schoolyard bully showed up and was like hey, sorry about that, I’ve changed and I think we can actually do great things together now. It might be true, but that doesn’t mean the kids who got bullied will go for it. One legacy of the Travis Kalanick era is that Uber still has an uphill battle to convince people it hurt in the past, like taxi drivers, that it now operates in good faith and has changed how it does business.
Cleaning fees.
The other week I asked what you wanted to see in Oversharing and fellow Substacker Petition raised the very good question of why fees on Airbnb are so high right now. (Petition is great, btw! Subscribe to Petition!)
Well, here is the Wall Street Journal with some reporting on that:
The pandemic has put a renewed focus on sanitation, but some short-term-rental guests resent the cleaning fee, a flat-rate charge set by the host that varies widely based on the property and location. Some guests say they feel duped when they see an attractive nightly rate, then encounter hundreds of dollars in added fees before checkout.
Traditional hotels can have added charges, such as resort fees, but don’t typically itemize housekeeping bills. This is why industry analysts say short-term rental cleaning fees can spark a strong reaction in guests, especially when they also receive cleaning instructions before departure.
Home-rental analytics company AirDNA told the Journal that average cleaning fees for one-bed properties rose from $59 in 2020 to $73 in 2022 (+24%), and from $112 to $137 overall in that period (+22%). That’s a big increase in two years, especially for people who may not have traveled since before the pandemic and may be shocked at the jump. People are also frustrated that Airbnb promotes and lets guests sort listings by the nightly rate but not by total cost, which can be significantly higher after cleaning and other fees are added in. Following a public backlash, Airbnb said last May that it would review fees on the platform, but missed its own deadline of making new recommendations by December 2021 and still has yet to share any updates on that front.
‘Tip baiting.’
Don’t do this, don’t be a terrible person:
As demand for Instacart skyrocketed in the early months of the pandemic, customers struggled to get time slots. Some resorted to tip baiting to entice Instacart shoppers, who are treated as independent contractors, to pick up their orders first but then removed the tip after delivery, leaving shoppers demoralized.
Instacart previously tweaked its tipping policies so that customers had to leave feedback to remove entirely or ‘zero out’ a tip after delivery, and cut the window to change a tip to 24 hours from three days. Now Instacart is promising to cover a shopper’s tip up to $10 in the event that a customer removes it post-delivery without citing an issue with their order. That guarantee is definitely an improvement, but again, please just don’t do this. Also, tip your delivery worker in cash.
Other stuff.
Gas price surge fuels fights at FedEx, Uber over who will pay. Voi e-scooters face axe in Bristol over ties with Russian investors. SoftBank’s Vision Funds stymied by weak IPO market. Uber doesn’t want to be Expedia. DoorDash adds cheap subscription takeaway option for students. Federal judge lets antitrust lawsuit against food delivery companies move forward. Instacart won the pandemic but rivals are catching up. Chicago prepares to relaunch e-scooter program. Lime giving out free rides and T-shirts for ‘Breakup with Cars’ campaign. Okai launches first consumer e-bike. NYC borough presidents ask city to allow more e-bikes in Citi Bike fleet. At least 50 U.S. gig workers killed on the job since 2017. Airbnb hosts say giving guests extra time to reports issues opens door to scams. Minut IoT sensors tell Airbnb guests to keep it down. Is Uber skirting alcohol sale regulations with deliveries by Drizly? Seattle weighs pay floor for gig workers. Uber but for lawns. Bicycle tourism. Supertall buildings. Bizarre $1.2 million Wisconsin ‘cave mansion’ sells, becomes Airbnb rental. Jared Leto had secret meeting with Adam Neumann for WeWork TV show.