David Rosenthal: evaluation

Transcript context

…Which for anybody who's ever tried to hail a cab through the radio dispatch system, you know exactly how well that works. Exactly, and then computerized dispatch in the 80s. But the problem is the taxi drivers are still independent contractors, so it's like a suggestion. If a dispatch goes out on the radio or on the computer system, to somebody who needs a ride from a given location to a given destination, it's optional, whether you look at them. If you see a fare on the street along the way, you can just pull over and pick them up instead. A San Francisco taxi driver named John Han wrote a blog post in 2011 right after Uber, Taxi Magic, Cabulous, and all the other companies will get into his lunch. He describes the current situation. He says, you don't have to respond to a radio call if you don't want to. Remember, dispatch service, we are told, is just an "information referral service." This is due to complications that have arisen from independent contractor status. I guess what that means is that dispatch service doesn't legally entitle any public passenger in any way to a taxicab that they've just ordered by phone. They can call it, but they're not guaranteed to get one. It only guarantees that their information will be dispatched to us drivers so that their request will be made known to us. You can service radio orders if you'd like. I do. I like them. But I guess you could just as well take one and leave the passenger hanging on the phone for fun as a prank, so long as you see another fare on the street that could be better anyway. He's like, I don't actually do this, but in theory, I could. I'm just making a point. Anybody who is old enough to remember the world before Uber, Lyft, Sidecar, DiDi, and everybody else, that really was how it worked. It was awful. New York was probably the best American city and the most efficient cab market, but any other city and particularly San Francisco, it was impossible to get a ride as a passenger. Drivers do okay here. The cab companies and the drivers are the ones who are always lobbying to sustain the regulation that keeps the industry dynamics like this, but it's not like the drivers are doing great either. There are strikes all the time. There are tons of labor unrest. The industry kind of tiktoks between drivers doing okay to drivers doing really poorly. The industry is completely broken. That goes on for a century. We fast forward to 2008. Two super critical things happened in 2008 that completely changed the course of this market. One, as we have talked about many times in the last couple of months here on the show, Lehman Brothers goes bankrupt, and the Great Recession begins. We're going to come back to that, but the dynamics of what happened here totally mirror what happened 70 years prior in the stock market crash and the Great Recession. Unlike then, there is another thing that happens. In 2008, Apple introduces third-party apps for the iPhone with iPhone OS 2.0. That definitely did not exist in 1929, iPhone 3g and iPhone OS. It was not iOS yet. There's no iPad, iPhone OS 2.0. ppens. In 2008, Apple introduces third-party apps for the iPhone with iPhone OS 2.0. That definitely did not exist in 1929, iPhone 3g and iPhone OS. It was not iOS yet. There's no iPad, iPhone OS 2.0. Right around this time, a Virginia-based entrepreneur named Tom de Pasquale, I don't think he was necessarily thinking about the effects of the Great Recession and the Lehman Brothers collapse, but he definitely was thinking about iPhone OS 2.0, and says, this is the wedge to finally bring some modern customer-centric innovation to the city transportation and taxi industry. Tom had previously started a software company that was a travel booking tool, and it was acquired by Concur, a Seattle company and a great technology company. He had left Concur, and he starts this new company. He calls it Taxi Magic. His co-founder is a guy named George Harrison. I know George. George, many years later, has become the CEO of Shift, the used car marketplace here in San Francisco. It's amazing. It's amazing how small all of these little sub worlds in technology are.…

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