Taking a taxi. A thought experiment

Think about this for a moment.

In order to solve a relatively easy problem (improving the usability of taking and paying for a taxi ride) with relatively well established technologies (mobile app + credit card), we’ve had to create global huge behemoths (Uber, Lift) raising astonishing amounts of venture capital. Ten years in the ride, those companies are burning cash like Marx brothers in the train (Timber, Timber!!) …

… without a clear prospect to be profitable in the short medium term, and while making the case that they will eventually have to take a significant part of a total addressable market of $12 trillion (mobility, delivery, etc.) to break even.

Those companies also promised to contribute, not only to a better user experience, but to solve the much more complex problem of mobility in cities. However, ten years in the ride, they are contributing to just the opposite.

Whoa! Something does not add up here.

When I think about it, my conclusion is that the innovation model we have is completely broken. Or more precisely, we are trying to apply and rely on a method (individual initiative, risk taking and the market) which has proved to be successful in the past to solve certain problems, to address every single challenge we face. And perhaps one size does not fit everything…

I am all against central planning and superfluos regulation, but let’s think for a moment….

Imagine a city like, for example, my city –Madrid– in 2012. And imagine a smart mayor (I know, I know… it’s just a thought experiment). Because he or she or “it” is smart, this mayor knows the taxi service is far from perfect and also knows there is a relatively simple way to improve it. Therefore, it wouldn’t be too difficult to say:

Hey, if you want to provide a riding service in this city, in addition to a license, and painting the car white with a red band and the license plate blue, and all those little funny things, you also have to be ready to be hired on line through an app and accept payments from your customers with a credit card. Full Stop.

I know things are never so simple, but do you actually think that improving a well defined service like taxis when you have proven technologies to do it have to be so terribly difficult?

Think about it, because tomorrow, we’ll be talking about truly complex problems like… global warming.


Featured image: Would you take this taxi?


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