UBER OF X— WHAT IS THE NEXT BIG THING?

Uber’s success and rise to being Silicon Valley’s highest valued privately funded company is inspiring the “Uber of Everything” or “Uber of X” — the on-demand revolution. While the list is full of creativity and entrepreneurial spirit, reaching success including attracting VC funding will depend on the size of the market potential (current and room for growth assuming incumbents will remain). What makes “Uber of Everything” or “Uber of X” a trend is the nuanced but powerful on-demand feature that improves on the previous wave of simply making a service accessible online or via mobile app. Getting both supply and demand side of the marketplace right defines success. Supply has a lot to do with being able to transfer everyday work from those that need a service to those willing to do the work for them. Demand is attracting enough of the consumer pie, both current customers and new adoption, the potential of which is discussed below.

I analyzed market size for some of these categories to quantify potential. While many seem to present $100bn+ market opportunities and validate entrants, actual opportunity is derived by taking a step further in estimating % market share that can be challenged by better distribution, access, transparency, consistency, increased satisfaction via instant gratification using a platform and ease of payment, all while keeping private data private.

In the graph above, the darker bars represent US market share only (adjusting Global figures as needed).

Taking a further step, the light shaded bars identify market addressable by an on-demand service. I applied two assumptions to the raw market data:

1) market share that can be serviced on-demand (today, in an hour delivery)

2) new market share created by the value the service creates

Key indicators to ability to challenge are a large undisrupted industry as well as the ability for the convenience factor to increase market size (more frequent usage, increased value). To illustrate this, we consider a use case of a daily medical marijuana user. A medical user will probably buy ahead in bulk (like any medication), ordering for immediate delivery only when they run out, say a few times per month yielding say 0.5% of $14bn or $700m. But this market may be larger if “Uber420” made it much more convenient and increased the quality of the service, for example by being a rating repository for the best marijuana retailers. Alternatively, Uber420 could lower barriers by providing annual subscriptions that automates a more personalized experience. Uber’s customers have a very different demand profile that is much more frequent from multiple daily trips to a few times per week lending to Uber’s estimated worth of 10% of $300bn market ($200bn existing global taxi and car-service plus 50% increase in market demand created; UPDATE Jan 2015 figures released by Kalanick, Uber CEO point to increasing taxi market by 350% in US metros).

Supply side is heavily defined by being able to attract, mobilize and retain a small army of drivers/shoppers/delivery teams. The platform’s ability (technology + compensation structures) to effectively do this defines the size of the market. This is where Uber itself has excelled. It has a model that fits just about anyone, full-time long term, full-time in between jobs, and those looking for a flexible way to augment their income. Car owners have filled the round of drivers, and those leasing through Uber or outside companies continue to grow the number of drivers. Income inequality has a lot to do with creating a supply of workers, recently Wall Street Journal highlighted the gap between the average wage of Silicon Valley high-skilled workers of $118,651 to that of low-skilled workers at $28,847. Like all major structural shifts, it has not been perfect, but it’s a major push toward the future of jobs.

Conclusion: Legal, home, lawn, alcohol (really groceries including alcohol is best combo), and security services look as favorable or better than Uber (for taxis) itself. Consideration of competitive landscape and execution would be the next step, or simply putting out a beta.

Global Figures:

$300bn Uber of Uber: Uber (of course), Lyft, Sidecar, Blah Blah Car, Hailo, Easytaxi

$400bn Uber for professional home services (cleaning, plumbing, see note 1): Handybook, HouseCall, Handy

$7.43bn Uber for valet your car / Uber for parking services (note 2): Vatler, ZIRX, Caarbon, Curbstand

$205bn Uber for courier services (note 3): Postmates, Shyp, Doordash

$14bn Uber for marijuana delivery (note 4): Eaze, Canary, Meadow

$74bn Uber for ice cream (note 5): Icecream.io

$6.6bn Uber for iPhone repair (note 6): iCracked

$135bn Uber for Security services (note 7): bannerman

$100bn Uber for grocery shopping (note 8): Instacart, AmazonFresh, Google Express

$28bn Uber for last minute hotels (note 9): Hotel Tonight, hotel quickly

$103bn Uber for private tutoring (note 10): Cambly (language only), StudyHall, GotIt!

$70bn Uber for group fitness popups (note 11): Fitmob

US Figures:

$80bn Uber for lawn mowing (note 12): Plowz , Mowz

$7bn Uber for flowers (note 13): BloomThat, Proflowers, Floristnow

$36.4bn Uber for Gifts / Uber for Wine / Uber for fine alcohol (note 14): SixDoors

$198bn Uber for alcohol (note 15): Foxtrot, Minibar, Saucey, Drizly

$937million Uber for Dog Walking (note 16): Swifto, Fettch, Urban Leash

$3bn Uber for massages (note 17): Zeel, Unwind, Soothe

$50bn Uber for beauty services (note 18): Swan, StyleBee

$1.9bn Uber for nightclub bottle service (note 19): Tablelist, BottlesTonight

$7bn Uber for laundry / Uber for dry cleaning (note 20): FlyCleaners, Wash.io, Cleanly, Dashlocker

$180bn Uber for doctor house calls physical and e-visits (note 21): Medicast, Doctor On Demand

$274bn Uber for Lawyers (note 22): http://lawtrades.com/

$30bn Uber for Tech Support (note 23): Geekatoo

$16bn Uber for roadside assistance (note 24): honk, Road Angels, Urgent.ly

$9bn Uber for car washes (note 25): Cherry, Washly

$60bn Uber for mechanics (note 26): YourMechanic

Global figures are used where available, otherwise US data is quoted, see notes for breakdown. Better market data is welcomed, email me or ping on twitter @ybromero.

Enter your own assumptions by downloading the excel with data and graph.

Notes:

1. 2014 Global estimates: includes Plumbing, handyman, landscaping services, pest control, furniture assembly & installation, painting services, moving and storage, electrical services, and carpet cleaning
2. 2018 Global estimates: includes Parking Management Market Access Control, Security and Surveillance, Revenue Management, Reservation Management, Valet Management, Enforcement and Permit Management, Guidance and Slot Management
3. 2013 Global actuals
4. 2015 estimates for US, Canadian & European markets for legal medical and recreational use
5. 2018 Global estimates for retail sales
6. 2014 Global estimate: Repair costs to consumers since iPhone launch in 2007 to 2013 applying conservative 10% y-o-y growth; iPhone reported 4Q14 16% y-o-y
7. 2016 Global estimates: includes guard services, alarm monitoring, armored transport, private prison management, consulting, private investigations
8. 2018 Global estimates
9. 2016 global estimates total hotel rooms $550bn and 30% searches for last minute deals converting 5% to purchases. Skytouch Technology reported 72% of OTA mobile bookings are made within 24hours of stay.
10. 2018 Global Estimates
11. 2014 Global Estimates: fragmented services from Gyms to DVDs
12. 2015 estimates for US market; breaks down as 67% single family residential, 25% commercial/industrial, 7% multi-family, and 3% governmental/institutional
13. 2014 estimates for US market
14. 2013 for US online gift market; includes gift cards and physical gifts and flowers quoted above
15. 2012 for US retail includes spirits, beer and wine; all Global will exceed $1trillion
16. 2014 estimates for US market
17. 2014 estimates for US
18. 2014 estimates for US market
19. 2011 estimates for US market for nightclubs
20. 2014 estimates for US market laundry and dry cleaning; growth potential converting $3bn coin operated laundry users
21. 2014 estimates for US and Canada: physical doctors and telemedicine/e-visits
22. 2013 estimates for US practicing legal market including small and large markets plus research; 7m SMB plus 80% consumer legal events are untapped market potential of $90bn
23. 2015 estimates for US based on Consumer + SMB tech support
24. 2014 estimates for US and Canada; based on AAA 25% market share
25. 2014 estimates for US for car wash and auto detailing
26. 2014 estimates for US