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Uber, founded in 2008 is a ride-sharing startup. In 2015, Uber became the most valuable startup at $51 billion. Even though 2020 was a tough year for everyone, Uber is still the most ‘successful’ ride-sharing app and startup. While Uber continues to gain users and drivers and consistently out number’s Lyft’s daily user count, the company has always struggled to generate revenue.

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By Becky Bergman

January 13th, 2022

Uber allows everyday citizens to use their personal vehicles to help others out, earning a small portion of income along the way. Uber, Lyft, Curb, Via, local taxis, and public transportation are all vying for the same customer pool. So, what sets Uber apart? What makes Uber the top dog?

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We’ve all heard of a unicorn. No, not the mythical creature. A unicorn is a private company or startup valued at over $1 billion. What about a decacorn, yes that’s a thing. A decacorn is a private company valued at over $10 billion. Among the top 10 decacorns, sits Uber. Uber, founded in 2008 is a ride-sharing startup. In 2015, Uber became the most valuable startup at $51 billion. Even though 2020 was a tough year for everyone,

Uber is still the most ‘successful’ ride-sharing app and startup. While Uber continues to gain users and drivers and consistently out number’s Lyft’s daily user count, the company has always struggled to generate revenue.

Uber allows everyday citizens to use their personal vehicles to help others out, earning a small portion of income along the way. Uber, Lyft, Curb, Via, local taxis, and public transportation are all vying for the same customer pool. So, what sets Uber apart? What makes Uber the top dog?

Market Information

Founded in 2008, former founders of Red Swoosh and StumbleUpon, Garrett Camp and Travis Kalanick started Uber to assist college students find affordable ride sharing options. Uber launched in San Francisco in 2009, originally allowing users to hail a black luxury vehicle.

In 2012, they introduced UberX, a cheaper option which allowed drivers, who meet all the requirements, to use their personal automobiles to shuttle Uber users around. And in 2015, Uber announced its millionth driver. In just 7 years, Uber was able to attract both riders and a substantial number of drivers to their app, and currently operates in 65 countries.

Unlike most of its competitors, Uber offers a variety of options and other services. Including but not limited to:

  • UberPOOL, a carpool service
  • UberRush, a parcel delivery service
  • UberFresh, a grocery delivery service
  • UberEats, a food delivery service
  • UberPet, a ride sharing option for you and your pet
  • UberWAV, a ride service for the handicapped
  • UberONE, electric car ride-share.
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With all these services under its belt, you'd think Uber was invincible. However, not even Uber was able to escape the wrath of 2020. While Uber itself suffered in 2020, UberEATS grew tremendously. Over 200% from 2019, to 2020.

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Lyft, Uber’s main competitor suffered even more in 2020. With their revenue and number of drivers cut in half, they still haven’t recovered. In 2017 Lyft became the publics’ first pick when Uber faced backlash over several issues including cultural issues, political issues, and legal issues. Lyft offers similar services with less variety, allowing you to unlock bikes/scooters and get rental cars alongside their flagship service: on demand taxis. In comparison to Uber, which operates in 10,000 cities across 64 countries and maintaining approximately 3. 5 million drivers; Lyft operates in 321 cities across United States and Canada with approximately 1 million drivers. While both Lyft and Uber are massively successful, there is still room for improvement.

The rideshare and transportation industryisn’t going anywhere.The future is autonomous/self- driving cars or on demand rental cars. Hail an Uber or Lyft and an empty car will pilot its way to your door, you drive yourself to your destination and the vehicle departs. Implementing new technology into your app could give you the cutting edge you need.

Why is Uber ‘uber’ Successful?

To ensure your app is successful, you need to know why Uber is so successful.

Founded at the perfect time, during the rise of smartphones, apps and on-demand services, Uber created a whirlwind of convenience at a user's finger tips. The decacorn's goal has always been to pick up the slack of public transportation. Improving efficiency and overall access to transportation in urban centers. Because Uber has no hand in the schedule of its drivers, it created an autonomous workforce enabling for short wait times, usually around 5 minutes.

Drivers drive because they want to, not because they have to. Many of them enjoy the extra profit, and the company of a stranger. Uber's blog "Why I Drive"quotes several freelance drivers as stating they love the flexibility.

How much do Uber driver's make? Earnest.comshowed that a majority of drivers (84%) make anywhere from $0 to $500 a month, and 2% make anywhere between $1500-$2000 a month. The flexibility and potential earnings bring drivers in flocks. Uber Currently has over 3 million active drivers world-wide, more than double Lyft’s active driver count. Many drivers utilize both ride- sharing apps to maximize their profitability. Riders gravitate towards Uber over Lyft for the shorter wait times due to the abundance of drivers. Uber is all about profit, registered drivers do not receive a discount when requesting a ride for themselves.

Uber is more readily available in multiple countries, increasing the number of global riders. The fees and price sit around the same between Lyft and Uber. At this point both apps are very similar, since rivals will mimic and adapt as time goes on. However, there are a few key differences between the apps

But as time goes on. However, there are a few key differences between the apps.

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The first, is saving locations. While both Lyft and Uber allow you to save your home and work address, Uber gives you the option to save additional addresses to your “saved places. ” On Lyft, your favorite places fall to the bottom of the list making them harder to find.

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Uber offers wheelchair accessible ride options, while Lyft does not. Most of the other ride options remain the same between the two. Both apps allow you to edit the ride mid-transit, see your driver information, and tip mid-ride. However only Uber allows you to split the fare, Lyft removed the option in October. Once a ride has been completed, Uber pops up with options to share your trip, provides safety

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Once a ride has been completed, Uber pops up with options to share your trip, provides safety center information, or call 911 and share your location and information with authorities. While Lyft, simply shows a popup wishing you well. Due to a few scandals in 2017, Uber added additional safety features to accommodate and protect it’s users.

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The list continues on their differences, to read the full article click here.

Recently Uber acquired Drizly, an alcohol marketplace that offers a variety of beer, wine, and spirits online. Adding to its arsenal of food and beverage services. As stated previously Uber has its hands in a lot of pots. package delivery, food delivery, rideshare, grocery delivery, the list will only get longer. Uber, unlike Lyft, has its hands in almost all things transportation. From food delivery, to pet friendly ride share options, and grocery delivery. Uber is making an effort to bring transportation and convenience to the palm of it’s users’ hands. How Does Uber Work?

How Does Uber Work?

The Technology of Uber:

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Uber provides a short blog detailing “How Does Uber Work”which runs through the steps of requesting a ride, the ride, and the reviews. We want to go a little more in-depth with how the Uber app works and talk a little bit about the technology powering the Uber app.

The key features we’ll be dive into the technology for are Geolocation, push notifications, and payment processes.

First up is Geolocation, it’s a lot easier today than it was back in 2010, technology and both Android OS and iOS have progressed. The technology varies depending on the phone’s operating system. For iOS devices Uber uses CoreLocation framework to determine the user’s geographic location, altitude, orientation, or position relative to nearby iBeacons by using all hardware available. The Android version uses Google’s location API. Geolocation services must provide accurate locations of the driver and the rider, provide efficient route navigation and directions.

Uber’s push notifications and SMS messages use Twilio, with the assistance of Apple Push Notification Services, and Google Cloud Messaging.

There are a few integrations and APIs Uber uses to process payment. The first is Braintree, a mobile payment market to accept card payments. The second is PayPal’s Card.ioservice for scanning credit cards (feature available only on iOS devices. )

Now that the important technology has been laid out, let’s talk about features.

Important Features

A thorough and innovative feature list will set your app apart from both Lyft and Uber. However, it’s important to acknowledge what features both apps offer their users, the purpose, and how you can implement similar features while maintaining an edge.

Passenger List

  • Request a Rider
  • Schedule a ride
  • On the Uber home page: Food delivery (connects with UberEATS), Grocery delivery, pay by the hour, Package delivery, explore (integrated with yelp)
  • Payment
  • Driver rating
  • Various safety features
  • Ride selection (vehicle class )
  • Split the fare
  • multiple drop-offs
  • Saved destinations

Driver List

The Uber Driver app allows a user to dictate whether they wish to drive or deliver goods. According to their Google Play description “no other app offers the same opportunities”.

  • Turn on availability
  • Destination filters for driving, not delivery (limited)
  • Earning Estimator
  • Instant Pay
  • Trip History
  • Passenger Rating
  • Background Checks

At a minimum, your ride share app needs to offer the entirety of the passenger feature list, as well as a unique interface for your drivers. Offer a dashboard that’s easy to use, displays peak ride hours, an earning calculator, an online vs offline toggle switch, and a way for drivers to designate where they want to work. If you look at a majority of the criticism Uber faces, it’s due to customer support, and technical difficulties with payment features. Ensure that your secure payment and cash out functions are fully tested each time an update is pushed to your apps, and send plenty of user notifications keeping a balanced level of transparency between your business and the business of your drivers.

Before allowing drivers to fully sign up, create a list of requirements to ensure the legality of their ‘employment’ and the safety of passengers. For instance:

  • Run a background check on new signups
  • Have a valid driver’s license
  • Require drivers to be at least 21 years old (If you’re under 25, must have 3 years of driving experience)
  • Have an eligible vehicle (4-doors)
  • Proof of residency
  • Proof of insurance
  • Require an online screening

In a deep dive comparison of Lyft and Uber, from a driver’s perspective, we see that while Uber gives more control to the passengers, Lyft give more control to the drivers. The RideShareGuy, shares that Lyft allows him to more easily screen riders, and better choose the trips he would like to pick up, as well as the fact that Lyft seamlessly integrates with Google Maps and automatically initializes navigation via Google. Uber, however, integrates with Waze and requires you to manually start the navigation. Another point given to Lyft are destination filters. This feature is usually available on both apps (Uber has removed this feature in New York and Dallas, and restricts it’s use to twice a week, as well as removing the feature all together during busy drive times), Lyft allows this feature to be used to six times a day. A destination filter allows a driver to filter rides that are headed in a specific direction.

A few additional features to consider would be the ability for a rider to favorite drivers, an in-app chat for passengers and drivers to communicate through in case of confusion, and driver working limit to keep your ‘employee’ welfare in check. Create a gamification system that encourages drivers to pick up more trips, and consistently login, add a rewards system for passengers so they return and refer their friends.

When it’s all said and done, Uber is a business. Earlier we revealed that Uber has always struggled to make a profit.

How Does Uber Make Money?

Uber takes a cut of fares from all its services, not only from Uber the ride share service, but UberEATS, and Uber Freight. Consistently struggling to earn a profit, the ride share giant posted a net loss of $6.8 billion for the fiscal year of 2020. In 2020 Uber reported 43. 6% of revenue came from Uber (mobility), while 35% of its revenue came from UberEATS (delivery) a huge increase from the previous year. UberFreight provides 9% of Uber’s total revenue. Early in 2021, Uber sold its self-driving car unit to Aurora Innovation inc, which included a $400 million cash investment, giving Uber a 26% stake in Aurora. This is the first step from CEO Dara Khosrowshahi to restructure Uber and turn it into a more profitable business.

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Uber is a two-sided marketplace. Drivers and Riders. Drivers flock to ride sharing apps and delivery apps for several different reasons. It’s a great way to generate additional income alongside their full-time job, classifying their profit from Uber as a part time job. While others drive for Uber for the flexibility in hours. Uber takes approximately $. 19 per ride, about a 25% commission. The user is charged a base rate, a route-based fee (estimated time and estimated distance), and a potential surge/demand pricing in peak hours, during incremental weather, and during the holidays. This formula is used on all it’s services.

How To Make an App Like Uber?

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Rehash: Technology Required

Now that we’ve gone over the business and technology stacks, let’s get into how to actually build the app.

The specific technology of the app may vary depending on your actual technical requirements and scope. However, this is a good starting point for your Uber-esque app.

  • React Native for cross platform development. Our team specializes in React Native development, this will bring your app to life faster, we’d utilize one code base and push to both iOS and Android devices.
  • Azure for hosting because of their ability to seamlessly auto scale as more resources is needed.
  • Firebase, used on Trade’ em and Geekstyr, to create push notifications and SMS messages while utilizing React Native.
  • To allow for social login we’d integrate individually with the login mechanisms of Facebook, Twitter, Google, etc.
  • OCR (optical character recognition) plugin for scanning cards. We have integrated apple and google pay to process debit and credit transactions in the past, to support physical cards, we would integrate with a NFC terminal.
  • Apple maps on iPhones and Google maps on Androids. Google Places, and Google Directions to drivers have accurate and timely directions to the rider and to the rider’s destination.

On top of the tech stacks and APIs, you’ll also need a team:

  • Project Manager
  • Team Leads
  • Backend Developers
  • Frontend Developers
  • UI/UX designers
  • Content Manager
  • Quality Assurance Engineers
  • Beta Testers

Bring your app to life

The first steps in bringing your app to life, start with research. Tons and tons of industry, market, technology research. From there you must strategize your business positioning, monetization, marketing, app strategy, and create your scope. Technical requirements, and use cases are also an important part of your app journey.

Create your app wireframes, branding/style guides, user flow, and mocks based on your competition and user research. Both Uber and Lyft keep their designs sleek, modern, and minimalistic. Uber opted for a minimal color palette utilizing gray tones, while Lyft added a pop of color.

Next, task allocation. Break the requirements and scope down into sprints. Our team uses an Agile method of development, which involves two-week sprints, weekly standups, and biweekly client calls to ensure transparency and to make sure there isn't any reason to pivot any resources around for another feature that has priority.

Once the tasks are assigned, and mocks, user flow, and technical requirements have been finalized, it’s time to move onto developing the applications.

Uber has an app for the passengers, and a separate app for the drivers (the driver app works for both UberEATS and Uber drivers).

Once the first sprint of tasks is complete, the quality assurance engineers will go through and start checking for bugs. By doing this it’s easy to ensure the quality of the rest of the application. Since the first sprints are usually the building blocks of the application, it is vital that they are issue and bug free.

The development team will continue working on the sprints until all the features and requirements have been implemented and tested. A final round of bug checks, and quality assurance will finish out the development phase of the project. Once all the features are approved, the app will be launched to both the play store and the app store.

Recurring updates, maintenance, and new features can be implemented down the line once the app has been launched.

The Cost of an App Like Uber

There are a lot of considerations to consider when calculating the potential cost of an app system like Uber. There are the cross-platform apps for both Android and iOS for the riders, the cross-platform apps for the drivers, the database and storage management/serve, API integrations, beta testers, several round of mocks, etc.

Our team would charge anywhere from $200k to $250k for a fully featured app system like Uber.

At Nexrage we pride ourselves on flexible pricing, we’ll work with you to create a feature list that fits your needs and a price that you can work with.

Nexrage's Experience Working on Apps Like Uber

While an app with the exact functionality hasn’t been added to our wheelhouse yet. We’ve worked on similar client apps.

Artis IQ’s mobile app has an accompanying admin/merchant app that ties in directly to the user’s mobile phone app. A few of the other features you can find in the Artis IQ mobile app are:

  • Identity verification
  • A social media like feed
  • Claiming/favoriting items
  • Location services
  • Secure payment

Final Thoughts

The first step in your app journey, should be to research the market and ensure there’s room for improvement and competition. Is the market too saturated? How is your app going to stand out compared to Uber and Lyft? How are you going to draw in your customers?

Uber set out with a clear mission; to become the end all be all of transportation. From Uber to UberEATS, UberRUSH, UberFresh, and UberPET, the decacorn is taking the world by storm.

While you’re focused on the business side, we’ll have your back with software development. Nexrage Studios prides itself on efficient, precise, transparency and clean coding. Contact Us today to get your project started!

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Check out our blog on How We Would Build an App Like Starbucks.