Entrepreneurship And Uber: A Look At The History, Challenges, And Opportunities

What is Entrepreneurship?

Question:

Discuss about the Entrepreneurship in Context for History of Uber.

Entrepreneurship is defined as the willingness and capability for one to develop, manage, and organize a new business activity considering the risks involved in the decided business debentures to make a profit. It can also have a definition as a mindset; it comes about from a person’s way of thinking or acting. The person imagines new ways that existing problems can be solved and values created.

Entrepreneurship is a mindset that enables an entrepreneur to have the willingness and capacity to develop, manage, and organize a new business activity after they have considered the risks that are involved in the business with the aim of making a profit.

The founders of Uber are Garrett Camp and Travis Kalanick who founded the organization in 2009 as UberCub. Garrett comes up with the idea on how he could reduce travel costs after spending $800 on a private driver (Schneider, 2017, pp. 80). The thought of sharing costs with friends was appealing as it brought about affordability. Garrett later built the first Uber prototype together with his friends.

The organization’s services were officially launched in 2011 in San Francisco and changed its name from UberCab to Uber with a travel price that was way above that of a taxi. Black luxury cars were the only allowed vehicles for hailing by users. The first employer was Ryan Graves as a general manager.  A programme later developed where drivers would use their cars to drive for Uber and operated in 35 cities. This service option was known as uber x. 

An Uber carpooling service got launched in 2014 and riders traveling to the same direction were matched in UberPool and were extended to New York City in 2014. Uber self-driving cars got started in 2016 which had improved technology in them for genetic mapping and utilization of landmarks. Helicopter services were also available. Uber has since partnered with Dutch satellite Navigation Company for the provision of maps and traffic data to make its work more accessible while picking and dropping their users using the mapping technology.

In financing uber, the founders invested $200,000 and later $ 1.25 million that was by way of raised funds in 2010. Uber has also received funds Google Ventures, Chinese search engine, Toyota, and even a connection with mapping applications. Uber has many users subscribed to it with over 40 million riders using the service every month. The company currently makes a lot of profits and holds a high percentage in the marketing industry in the United States.

The History of Uber

The first problem has been facing criticism from other taxi operating drivers. The organization has been criticized for unfair competition because they used smartphone apps which prevented them from being subjected to certain fees contrary to what other taxi drivers who had to pay these costs experience.

The second challenge Uber is facing is physical violence against its drivers.Taxi drivers are marking uber drivers and subjected to physical assault by the same taxi drivers with the aim of instilling fear on the taxi drivers and stop them from operating Uber cars.

In this class of thinking, people will only pursue a venture during the circumstances where such persons are restricted from participating in specific activities, or they have been displaced from such events (Kuratko, 2016, pp. 15). Economic depression contains different aspects that affect financial sectors resulting to depression and recession in the economy. The effects could include bad times and experiences, job loss or even lack of capital which are external factors that could influence an entrepreneur to venture into entrepreneurship. The founder of Uber came up with the idea after a wrong time experience on New Year’s Eve after he had spent $ 800 together with his friends on a taxi driver. He thought the amount was very high and started brainstorming on how traveling cost could have been reduced to black car service.

This class of view lays its primary focus on the development of new ventures and the opportunities that are presented for these investments. The areas to pay much attention to are the development of concepts, the search for idea sources, and the manner in which venture opportunities can be implemented (Kurtko, 2016, PP 16). The entrepreneur should be creative and well aware of the market they plan to operate in and for the venture’s success, the right idea should be developed at the right time. The founder of Uber had concluded that for the travel cost using black car service to reduce, the value had to be shared with friends who would result in affordability of traveling. The idea of cost sharing developed to Uber. Garrett and his friends, Oscar and Conrad then built the first prototype, and Kalanick introduced as the company’s advisor.

The first emerging trends are the rise in lawsuits against Uber drivers. The service providers face accusations of failing to observe safety measures when with their users. There is a concern that some drivers use the Uber app during drives of their users during notification of new pick-ups. Another allegation that is on the rise is that Uber drivers have been involved in sexual assaults and other crimes. Their sophisticated app has also been alleged to be designed both the passenger and the driver. The lawsuits can result to users seeking an alternative transport making Uber lose its market penetration. Furthermore, Uber used a lot of funds during these cases, the funds being used could be generated for further development in the organization.

Challenges Facing Uber

Secondly, developing technology is another emerging trend. The technology used in the travel industry has improved over time significantly. Innovations are being released in the market, and these technologies are being adopted by different taxi industries (Chaston, 2017, pp. 10). The vast development in technology creates a motivation to many entrepreneurs who wish to venture into to the taxi industry. The growth in the smartphone app has also attracted many users who can now access taxi services from any service providers of their choice. The development in technology that is adopted by other service providers causes a stiff competition to Uber (Schaper, Volery, Weber,  and Gibson, 2014, pp. 14). Uber is likely to lose its subscribers to other taxi owners.

Thirdly, bad press is another emerging factor that could affect Uber service providers. There are negative stories that are making rounds on the social media concerning Uber. A customer’s behavior after being exposed to such stories can be affected positively or negatively. The effect on the user’s response depends on the level of trust that has been established between them and their service providers. In that instance, the user may choose to ignore the stories on social media if they trust Uber services well enough.

To reduce lawsuits against Uber, service providers should do an intensive background check on their drivers before hiring them. The test should be to a certain whether the drivers can be relied upon to perform with minimum supervision and observe all the set regulations or not. The drivers should be law-abiding citizens who have not engaged in any criminal acts and show no intentions of engaging in illegal acts in future. The drivers should further be able to establish a relationship that is respectful. A good relationship between the driver and the passenger will result in higher ratings which in turn attract more users thus creating a tremendous market growth for Uber.

Uber should strive to adopt a technology that is way advanced than that of other service providers to maintain their users and stay ahead of the competition (Drucker, 2014, pp.50). Additionally, Uber charges are lower than that of other taxi drivers who serve as an advantage for them. The more economical expenses and technology help Uber maintain its users and attract other new subscribers to the service.

Establishing a high level of trust between Uber and its users is another strategy that can help the organization experience growth in its market. High level of trust helps in boosting the customer’s confidence in the service providers. The user will then be able to ignore lousy press reflected in the social media. The people who air the negative stories on social media platforms in most cases are nor even Uber subscribers themselves (Kirzner, 2015, pp. 18). The people on social media are mostly people who subscribe to other taxi services and only have the malice to create bad publicity for Uber so that it can lose its subscribers. However, it is never easy for Uber users to stop subscribing to Uber because Uber offers lower charges compared to its competitors. 

Conclusion

To release a successful business, entrepreneurs have to pay keen attention and consider every factor that may affect the daily business activities. Frequent innovations have to be made to maintain the sustainability of the business and ensure that competition from rivals in the same industry is kept at minimal. Business should strive to establish a substantial market penetration to attract more customers. Entrepreneurs should be well aware and prepared for the risks involved in the venture. Additionally, users and subscribers of services should be treated well to foster a good relation and experience with the service providers and secure future markets for both profit and non-profit ventures.

Chaston, I., 2017. Entrepreneurship. In Technological Entrepreneurship (pp. 1-24). Springer International Publishing.

Drucker, P., 2014. Innovation and entrepreneurship. Routledge.

Kirzner, I.M., 2015. Competition and entrepreneurship. University of Chicago press.

Kuratko, D.F., 2016. Entrepreneurship: Theory, process, and practice. Cengage Learning.

Schaper, M.T., Volery, T., Weber, P.C. and Gibson, B., 2014. Entrepreneurship and small business.

Schneider, H., 2017. Conclusion: Entrepreneurship. In Uber (pp. 79-85). Springer International Publishing.