TMCnet Feature
October 13, 2021

Emil Michael on the Future of Uber and Other Gig Companies



Former Chief Business Officer for Uber Emil Michael offered his foresight into the future of business for companies like Uber and Instacart in an interview with MarketBrief host Caroline Woods. Michael relied on his vast experience working for Uber, the Obama administration, and Goldman Sachs, as well as several other start-ups and technology firms, in order to help predict what could happen in the world of business over the next year.



Michael offered opinions on meme stocks, government regulations, and foreign affairs in business, which comes at an opportune time as China continues to add new regulations to their economy.

Caroline Woods: For unique insight into the future of the gig economy, let's check in with Emil Michael, former Chief Business officer for Uber.

Emil Michael:

During the pandemic, you had the gig economy: companies that were doing delivery because everyone was home, and those took off wildly. DoorDash, Instacart, Uber Eats, you name it. The other tail was the ride sharing companies. Because no one was going anywhere, that business really flattened out. So what you have now coming out of the pandemic is actually the inverse. People are going out more and now you have a driver shortage on the ride hailing side. And on the food delivery side, it's still robust, but people are going out more also. So you'll see that crash or plateau a bit. Both parts, I think, are going to get a big boost in the next couple of months as the extended unemployment ends, the eviction moratorium ends, student loan forgiveness ends. People are going to need to go back to work in a way that they haven't so far this year.

Caroline Woods:

You were formerly Chief Business Officer at Uber, so when you look at Uber's business now, given that it's poised for this bump, where do you think Uber can find the next fresh opportunity or partnership?

Emil Michael:

Well, I think what you'll see is them to go hard at grocery delivery, because that is the one missing link in the big delivery categories that Uber doesn't have today. They have the ride sharing, they have hot food delivery, but when you're talking about groceries, Instacart has really dominated in the last couple of years. Uber bought a little company called Cornershop, out of Chile, that actually has some great software to do delivery of fresh foods, and they're going to expand that in North America. And I think that's going to be their big bet going forward.

Caroline Woods:

What are the biggest challenges ride hailing or ride sharing companies like Uber will face in time to come? Could it be volatile energy prices, restrictive government, new regulations, or something else completely?

Emil Michael:

No, I think your second point is really the big point, regulations. This administration is much more focused on labor contractor distinctions than the last one was. Some of the states, particularly in blue cities, are putting restrictions whether drivers are minimum wage levels or employees. That battle is, I think, going to be a big one for the ride sharing companies and the delivery companies in the next couple of years.

Caroline Woods:

Well, speaking of challenges and regulations, you led Uber's expansion in China. So I want to get your take on China's recent tech crackdown and how far reaching, long lasting you think the impact could be for tech companies?

Emil Michael:

It was very surprising. Having spent four years shuttling between San Francisco and Beijing, when Uber had launched Uber China, I got to learn a little bit about the capitalist theory that was happening there, and it was much more optimistic six years ago. Mark Zuckerberg (News - Alert) was there trying to get Facebook legal. Google had an office there. Uber was able to launch, other companies like Airbnb, LinkedIn, WeWork, you name it, had efforts to establish themselves. Now, those efforts have stopped. You're going to see a lot more caution for American companies going into China because of the uncertainty and you're going to see a lot more caution by investors putting dollars in Chinese companies to work. Because, if you put money into Ant Financial or DD or ByteDance, and it gets stuck in some way or delayed, or the value of the company gets hit because of some unexpected regulation that's not negotiable, think you could see a big slow down.

So I think the Chinese government is going to relax on this because they know that'll happen. But that's my bet. Not through the end of this year. I think you'll see more crackdowns then maybe more of an opening next year.

Caroline Woods:

I also want to get your take on IPO mania. Robinhood, of course, just recently went public and it was largely considered a bust because of how it traded on its first day. It's since been on a roller coaster ride, really trading in a wide range. But what do you make of the weight that's placed on the stock performance of these tech companies on day one?

Emil Michael:

I think it's too much. I think it's like a hot take on Twitter (News - Alert) that's bad a few hours later. It's a hot take on an IPO that's done that moment where all the factors and people are just trying to sort out, traders are trying to sort out what they should pay for this company. Is it going to become a meme stock? What do the numbers look like? Who's in and who's out? I think we make these judgments and forever now we'll think of Robinhood's IPO as a failure. And yet today, even with the volatility, it's more than 50 percent higher than its IPO price. So you've got to give these things some time. I think the hot takes, maybe we should make them warm takes, and then look at them over a little bit of time.



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