Uber Rushes to Claim the “Uber for X” Startup Market

July 5, 2016 - 2 minutes read
Uber is offering their network as a base for third-party delivery service startups.

Uber is offering their network as a base for third-party delivery service startups.

Uber just made UberRush available publicly to mobile app developers, allowing anyone to build on-demand services on top of Uber’s existing driver and delivery network. The result? A much shorter runway for small startups looking to become “Uber for X.” Rather than sourcing and maintaining their own fleet of drivers or delivery people, developers can pay a per-delivery fee to have items delivered via Uber.

The highly “meta” business move may strike Toronto mobile app developers as a conflict of interest, but it actually makes a lot of sense in the context of small business and brick-and-mortar shops. Delivering items quickly becomes more and more difficult as the items become less and less high-demand, making delivery service startups in niche industries notoriously difficult to get off the ground.

While app developers may fear Uber’s power to step in a “steal” a profitable business model, that’s really not their aim here — and they could probably do that anyway, regardless of affiliation.

Rather, Uber is looking to become a logistics company rather than simply a taxi service. UberRush not only provides them an additional revenue stream on top of an existing network, it also helps cement the idea of Uber for item delivery (versus person delivery) in the ideas of consumers, startups, and most importantly mobile app developers.

The churn rate of “uber for X” startups makes them a poor proposition for Uber as a manager. Providing the infrastructure for those types of startups, however, has the potential to be very profitable. How this network will adapt to the market as drone deliveries and self-driving cars drip into the equation, however, remains to be seen.

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