Invest Like the Best with Patrick O'Shaughnessy
00:35:30 · Dara Khosrowshahi, Patrick O'Shaughnessy
[00:35:30] S2: that is. The biggest issue is battery density and the ability of essentially battery to lift itself and then lift the payload and what that payload looks like, and then the requisite range and recharging needs of those drones as well. Jobia is building drones for people. That's happening. And I think drones for food and other grocery are going to start hitting real scale over the next two to five years. It is going to cost more than a human delivery to start with. But the ramp of the technology in terms of payloads being larger, in terms of being able to operate in whatever weather there is and then being able to very, very accurately get you a payload right in front of your house, all of it is moving in the right direction. So is it going to be a big part of our lives two years from now? No, But five to ten years from now, it's going to become more and more normal. [00:36:26] S0: I'm always really interested in the regional differences as well. I'm curious what you've learned watching AV start to happen in The US versus Europe versus The Mideast and anywhere else that you've had the experience. What is regional differences teaching you?
00:36:26 · Patrick O'Shaughnessy, Dara Khosrowshahi
[00:36:26] S0: I'm always really interested in the regional differences as well. I'm curious what you've learned watching AV start to happen in The US versus Europe versus The Mideast and anywhere else that you've had the experience. What is regional differences teaching you? [00:36:37] S2: Middle East is going fast. So The Middle East, especially if you look at Abu Dhabi, Dubai, Saudi Arabia, they are on it. The regulators are very entrepreneurial. They want to lean into new technology. So you're going to see those services. They are happening today. No vehicle operators in Abu Dhabi, Dubai. The US is certainly happening. The Californians of the world, Texas of the world, but we want to make sure kind of the right discussions are happening at a regulatory level. It's going to take longer in New York. It's going to take longer in Boston, for example. And Europe is starting to happen. We are starting commercial robotaxi in Europe and I think we will have pilots, for example, in London before the end of the year. So Europe is starting to recognize that they can't be left behind. European OEMs certainly are a huge player in terms of manufacturing capability and employment in Europe as well. So Europe is catching up. Another interesting US versus international story with Uber has been, [00:37:38] S0: as you've gone international with Uber Eats specifically, you've actually won or gotten to the number one position more often. I'm curious what The US experience in that category has taught you that's impacted how you approach strategy when going to an international market.
00:37:53 · Dara Khosrowshahi
[00:37:53] S2: The basics are the same. You've got to get selection right, you've got to sign up your merchants and when I look at the serviceable addressable market in the cities in which we operate, probably signed up around 40 to 50% of the restaurants and or merchants that can be on our platform. So it's about getting a selection and then making sure that you've got the right reliability. Every time when you order something, we get it right. We don't make mistakes. We deliver it to you within thirty minutes. And for us, our magic sauce is cross platform. We started with mobility and we are now able to increasingly upsell the mobility customer the delivery product, whether or not they want to use it on Uber Eats or they actually, when you open your mobility app now on Uber, you're going to see Eats right there. About 13% of Eats bookings are actually coming from the mobility business. In larger international markets and The US, you've got to get the basics right, but the platform for us is a structural advantage we have versus other model line players. We get a bunch of free customers from our mobility business. And then we have our Uber One membership program, 50,000,000 members now growing 50% year on year. Every company has a membership program. But the way I look at it is we're kind of like Netflix. For the same price, you get more content than anyone else. You get discounts on mobility, you get surge protection, you get free delivery, you get no fees on groceries, 60 more. Now you're getting 10% back on your hotel. So if we can build this loyalty program that is just bigger than anyone else's, and we have this cross platform magic, we think we can get to the number one position and at the same time have higher margins than our competitors and we're proving it out in market after market after market.
00:39:39 · Patrick O'Shaughnessy
[00:39:39] S0: So much of the story is being good at getting the supply. What does excellence look like there? What makes the best parts of Uber that do this the best? What makes them stand out? What is the key to being great aggregating supply?
00:39:52 · Dara Khosrowshahi
[00:39:52] S2: I think honestly, we're okay at it. I think we can get a lot better at it. I think one is I want to get more of our team members to put themselves in the shoes of our suppliers, to drive more, to go stand behind the counter or a restaurant. All of our employees are crazy users of Uber Eats and Uber Rides, but we don't put ourselves in the shoes of our merchants after COVID, partially because I was going freaking crazy at home, but partially because I wanted to understand, well, what does a driver courier experience feel like? I bought an e bike and started delivering food in San Francisco. And our drivers and couriers and merchants are on our platform much longer than the typical consumer. Typical consumer, year in, year out, maybe use us once a day, twice a day, hopefully three times a day, but the interaction is like a thirty second interaction. A driver will have our app open six hours, eight hours, ten hours a day. And as a result, the premium that we have to put on quality, making sure everything goes right, like a P95 bug happened to consumers once a month maybe for a loyal consumer. A p 95 bug is happening every single week for a driver who's on the app six hours a day. We are getting much better. We've got to put ourselves in the shoes of our merchant partners, of our delivery partners. I learned so much delivering food those couple of years in San Francisco, driving people on my Tesla in San Francisco. I think that's what it takes to be a better builder and be better at amalgamating supply, so to speak. We have a value at our company, which is building with heart. I'm an engineer at heart. I'm very numerical in how I look at things, but there's a craft to building. There's a humanity in our service, and we have to make sure that we keep building with heart and I think we can get better there.
00:41:45 · Patrick O'Shaughnessy, Dara Khosrowshahi
[00:41:45] S0: What surprised you most when you were doing the deliveries? All that experience? [00:41:48] S2: How hard it was going into the restaurant, figuring out where to pick up, making sure that you got your orders right. About 50% of orders are batched. So actually you pick up two deliveries, sometimes at the same restaurant or another restaurant, and just making sure that you get everything right. There's a reason why things go wrong in the real world. There's a lot to process for couriers, for drivers, and then you have to deal with the real world traffic as well. So just all of the things that you have to process for a consumer, you push a button, car shows up, you push a button, your food shows up. It's all easy. But for that driver and courier, there's a lot more going on and processing everything could be a challenge. [00:42:25] S0: The thing that you said is interesting is the membership concept, 50,000,000 people. It feels like this is the feature every big business with lots of people on it would want. And some of them have been great stories in business history, Costco and Amazon. What does each side get out of a great membership program and how much do you have to tweak and design that thing versus it being kind of straightforward of what people want?