High-tech mobility isn't just about a ride. It's about an experience, and the emerging poster-child in this space offers everything from a smooth, green ride and the most advanced technology to a tie-in to many things you need or want in life--that includes the best restaurants, fulfillment of your healthcare needs and even an exclusive line of merch co-branded by celebrities. Mentioned in today's commentary includes: Lyft, Inc. (NASDAQ: LYFT), Grubhub Inc. (NYSE: GRUB), General Motors Company (NYSE: GM), Ford Motor Company (F), Baidu, Inc. (NASDAQ: BIDU).
It's the ride of a lifetime, and it's not from Uber. Nor is it from Lyft. It's from the hottest new startup to come out of Canada's 'Silicon Valley'--Facedrive (FD.V).
Ride-sharing may be one of the fastest growing trends on the planet, but consider this: Uber, the hottest IPO of 2019, is now losing more money than ever and its growth has slowed to record lows.
Ride-sharing 2.0 is an entirely different beast. It's aiming both at turning a profit and giving the consumers what they want. It's all about monetization. If you can't monetize it, then your $100 billion valuation dreams will never be realized.
Yes, Uber changed transportation and completely disrupted the taxi industry. It also opened up a Pandora's Box of other issues, and in defiance, it took on regulators, making just as many enemies as friends along the way.
What it didn't do is make money. The cash burn has been enormous, and a decade into it, Uber is still only just hoping to achieve profitability in the fourth quarter of 2020 - also a year in which it will lose more than $1 billion.
Along the way, it earned a reputation for being the "avatar" of everything that went wrong with tech. That's Uber. Facedrive is the next generation of ride-sharing, and it's where the narrative changes.
If Uber is the "avatar" of everything that went wrong, Facedrive aims to be the "avatar" of everything that's about to go right: That means an entire ecosystem of revenue grounded on the rider relationship.
Ask Will Smith, whose Bel Air Athletics clothing brand is betting that Facedrive is the ride of the future. That's why he's co-branding an entire line of merch with Facedrive.
It's also why WestBrook Inc., the company he shares with his wife Jada Pinkett Smith, is partnering with this stunning startup that is about to expand internationally to start challenging Uber for the throne.
Why Ride-Sharing Isn't Just About Transportation
Facedrive is a "people-and-planet first" ride-sharing platform - two things that have been desperately missing from ride-sharing 1.0. What everyone got wrong the first time around with the novel idea of ride-sharing is this: It's not just a new transportation service - it's a high-tech industry. That means there are countless avenues for profitability beyond a simple ride. Take the food delivery business, for example.
GrubHub (GRUB) was an innovator in this scene. Though it was founded in 2004, it wasn't until 2014 when business really started picking up for the food delivery pioneer. And consequently, its stock price as well. While business flourished for some time, its stock peaked in 2018, reaching an impressive $144 per share. Since then, however, with the emergence of more apps, many of which haven't faced the same share of controversy, GrubHub has fallen out of favor. Despite the tough times, however, GrubHub is still alive and kicking, eying even bigger goals and new partnerships in the future.
Facedrive, too, is working on monetizing every angle of this high-tech sharing experience right out of the blocks with its Facedrive Eats delivery platform. The key difference, though, is that it did it all without butting heads with regulators or making enemies out of local officials. Instead, it worked with them directly to ensure that every program on its platform was a benefit to the community at large.
In the process, it caught the eye of major celebrities, big commercial banks, and the authorities who appreciate its attempts to offset carbon emissions.
Will Smith and Jada Pinkett Smith have thrown in with Facedrive and mutually benefitting partners through WestBrook Inc. And now, in Facedrive's ongoing efforts to rapidly monetize its ride-sharing platform well beyond the rides, they're launching an exclusive line of clothing branded by Will Smith's Bel Air collection and Facedrive.
Some 1,000 new products co-branded by Bel Air and Facedrive are ready to launch, with pre-orders coming soon on the Facedrive website.
The company is also rolling out a comprehensive health initiative, timed for rapid deployment to the frontlines of the coronavirus pandemic. Facedrive Healthcare includes everything from discounted rides for healthcare workers and specialized vehicles for anyone with additional needs to contactless delivery of essential over-the-counter medicines and medical supplies, including high-tech management of automatic refills.
Facedrive Eats, which is now piloting in six cities in Ontario and will expand to other regions soon. And the monetization of ride-sharing 2.0 will also get another boost amid the widely emerging trend of sustainable or impact investing, also known as ESG (environmental, social and governance) investing.
FaceDrive is betting that's a more significant aspect of profitability than you would think. It's also where Uber failed miserably. Today's big money is navigating toward risk mitigation, and it has nothing to do with the pressure from the right or the left. It's pure market sentiment.
Big capital is on the greedy hunt for innovative new companies that have latched on to the $30-trillion-plus mega trend of sustainable investing, which has outperformed the overall market.
Ride-Share 2.0 Is Already Here
There's a laundry list of things that went wrong with the first-generation of ride-sharing, even if giants like Uber and Lyft managed to burn tons of cash to pave the way for what comes next. All of those things have to do with sustainability and responsibility. And all of them, for connected reasons, have to do with the failure to fully monetize.
They've sidelined rather than worked in coordination with public transportation, causing big problems for cities, instead of seeking to patch transportation gaps where they're really needed.
A recent study by the Union of Concerned Scientists estimates that the average (U.S.) ride-hailing trip results in 69 percent more pollution than whatever transportation option it displaced. And a number of big name companies are rushing to get on board.
Lyft (LYFT) was the first of the major ride-sharing companies to commit to carbon neutrality. "We get up every day thinking about how we can continue to have a positive impact on the communities we serve. As we grow, so does the opportunity to increase this impact" John Zimmer, the cofounder and president of Lyft, said on the subject.
Not only is Lyft working on expanding the number of electric vehicles on the road, it's also looking to other innovative alternatives like bike and scooter sharing. Lyft even offers two types of bikes; the classic easy-riding urban city bikes, and new sleek electric bikes to help users get to where they need to go even faster.
General Motors (GM) is another well-known brand dipping its toes into the bicycle game. It has created its own brand of electric bikes, called Ariv. The bikes were just launched this year, but have already captured the attention of the European market. While they are on the side of pricey, coming in at $3,800 per unit, they do boast a high top speed and can travel a modest distance on a single charge.
The kicker for many, however, is that they can fold into an easily carriable pack, making them the perfect choice for a lot of commuters. Especially in big cities like London or Berlin.
Ford (NYSE:F) is taking a different approach. The car manufacturer recently dove head-first into the scooter market, buying Spin for a clean $100 million.
Initially deployed in San Francisco back in 2017, Spin is widely considered to be a part of the Big Three of the scooter world, along with Lime and Bird. While Ford's buyout of Spin made headlines, it's certainly not the first urban transportation alternative Ford's sunk its teeth into.
In recent years, Ford also bought commuter shuttle service Chariot, Autonomic and TransLoc, aiming to ensure that it does not miss the boat as this new movement accelerates.
On the other side of the world, tech giant, BAIDU (BIDU), is also making moves to revolutionize transportation. BAIDU, for its part, is taking on the automated car market. With more miles under its belt than any of its competitors in Beijing, it's an easy choice for a number of investors. Likewise, it has an equally large portfolio of innovative new technology...at a lower entry point than its competitors.
As the 'Chinese Google,' Baidu is following a similar path to its American counterpart. It began as a search engine but is quickly expanding into almost all things tech related. From artificial intelligence to television and finance, Baidu's ever-expanding reach is a not to be ignored. Especially for investors looking to stay on top of the new tech trends.
And now Facedrive has entered the playing field, looking to turn everything we knew about the sharing economy on its head. That's because they approach the industry as a tech transformation that has massive monetization potential because it's all about relationships with riders.
By. Cliff Johnson
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This publication contains forward-looking information which is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ from those projected in the forward-looking statements. Forward looking statements in this publication include that the demand for ride sharing services will grow; that the demand for environmentally conscientious ride sharing services companies in particular will grow; that FaceDrive's marketplace will offer many more goods and services; that Facedrive can achieve its environmental goals without sacrificing profit; that FaceDrive Eats will expand to other regions outside southern Ontario soon; that Facedrive plans to move to over 15 cities over the next 24 months; that Facedrive will be able to fund its capital requirements in the near term and long term; and that Facedrive will be able to carry out its business plan. These forward-looking statements are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. Risks that could change or prevent these statements from coming to fruition include changing governmental laws and policies; the company's ability to obtain and retain necessary licensing in each geographical area in which it operates; the success of the company's expansion activities and whether it justifies additional expansion; the ability of the company to attract a sufficient number of drivers to meet the demands of customer riders; the ability of the company to attract drivers who have electric vehicles and hybrid cars; the ability of FaceDrive to attract providers of good and services for partnerships on terms acceptable to both parties, and on profitable terms for FaceDrive; the ability of the company to keep operating costs and customer charges competitive with other ride-hailing companies; and the company's ability to continue agreements on affordable terms with existing or new tree planting enterprises in order to retain profits. The forward-looking information contained herein is given as of the date hereof and we assume no responsibility to update or revise such information to reflect new events or circumstances, except as required by law.
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