When a company that makes nothing, owns nothing, and does nothing other than connect potential users with providers of a service is approaching parity with the world's biggest industrial companies in terms of market cap, then no fucking shit there's a bubble. I don't understand why we're even debating it.
Hey, middle men have made money since practically the dawn of time. But I think it's a bad sign when your business model is making a product that you designed in a month that connects A to B. It's not exactly hard for any competition to match that once you've proved that link is money-making.
Connecting people is important in our economy. But it's easily done by any number of sales people. Uber found a good way of doing sales. That's it. How many people do they employ? How much infrastructure did they build? Etc. This isn't a real economy they're creating. It's a temporary fill in a gap in the market--a gap that was mainly created by excessive government regulation. Once that gap is closed, and the market is fixed, Uber is worthless.
> It's not exactly hard for any competition to match that once you've proved that link is money-making. Yep. Uber doesn't have a sustainable business because they'll be trivially outcompeted. You can already see this happening; cities with alternatives to Uber (lyft/etc) have cheaper rates.
I also feel like Uber is overvalued, but: they are sill valuable. They've basically introduced arbitrage into an industry that previously had a massive amount of underused supply, and in the process substantially dropped the cost of that service. This is a valuable service
If there is indeed a collapse, Mr. Gurley says, it will not just be the tech industry that feels the pain. Real estate, for example, could take a hit. Home prices in the San Francisco Bay area have appreciated by 97 percent since January 2000, according to a study published by the Paragon Real Estate group. If the influx of tech industry wealth begins to dry up, Bay-area property owners will have to deal with the potential drop in prices.
And nobody is going to be surprised. Luckily, I don't think it'll be apple, google, and so on, that will suffer or crash in anything but stock prices. It'll be all the startups and such that go down while thinking they are going to be bought up for two billion.