[Nail SFX]

Let's talk about Uber.

Uber is part of the new "sharing economy"

that lets people with their own vehicles

pick up consumers within minutes

and take them from point A to point B.

The buzzy bay area startup

has raised 1.6 billion dollars in just 4 years.

and is valued at an eye-popping 18.2 billion dollars

Uber is 204 cities,

across 45 countries,

and covers 55 percent of the U.S. population.

Imagine a world with less pollution.

No traffic jams.

And maybe you don't even have to own a car,

because your next ride is just a tap away.

No more scrubs! Hanging out of the passenger-side

of your best-friend's ride.

Uber!

This is the vision that Uber is peddling

and venture capitalists are fully on-board!

Uber's recent valuation,

makes them more valuable

Hertz,

Avis,

or United Airlines.

Uber managed to raise 1.2 billion dollars

from investors by Friday

and the company's CEO, Travis Kalanick, expects to get an additional 200 million dollars.

That's all thanks to the company's incredible valuation.

Investors estimate that Uber is worth

a whomping 17 billion dollars!

Add everything up

and Uber is now worth 18.2 billion dollars.

As the Wall-Street journal points out,

only Facebook managed to get a higher valuation from investors as a private company.

Also, Uber is now worth about as much as competitors

Hertz and Avis combined.

On paper,

Uber looks like a startup that wants to disrupt the 11 billion dollar taxi industry,

but what if I told you,

Uber's business model was more sinister than that.

The reason Uber can double revenue every 6 months

and close round after round of funding

is because they have found a way

to sidestep the costly regulations

that are required of cab companies.

Uber plays by a totally different set of rules.

Their game plan is to effectively ignore

whatever legal challenges

may eventually be thrown at them

in a quest to get big and drive their competition out of the game.

Uber is playing a game of Risk.

Their carefully, calculated missions

are putting them on a course for total domination.

Mission #1: Build a Fan Base

Position yourself as a classy, but cheap startup

and people will use the word "Uber" as a verb

and tweet their love.

Hashtag: #loveuber

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Mission #2: We Need Small Business

Uber is the new face of entrepreneurship and small business in America.

Uber CEO Travis Kalanick

said that drivers in New York make over 90 grand a year

and drivers in San Francisco make over 70 grand.

The San Francisco Cab Drivers Association

reported that 1/3 of the 8,500 cab drivers

in San Francisco have ditched driving a registered cab

in the last 12 months to drive for Uber instead.

Watch this video and try to resist starting your own business.

My name is Saahn,

My name is Meir

My name is Gehrat

My name is Bolivender-Singh

My name is Juan and I'm an Uber partner.

Yellow taxi is very difficult for me.

The effort, the energy, the hassle.

Sitting in the car like for 12 hour, 10 hour.

The amount of time that you put in.

I don't want that anymore.

It's significant comparing to Uber.

I'm never going back to the Yellow taxi.

I wouldn't be living the life I'm living right now if it wasn't for Uber.

You make more money, you're not hustling for the money.

You go online, you got paid like this. 1, 2, 3.

Slow, just patient.

When I want to work I can do it.

Being a part of Uber,

you move from the bottom of the ladder to the top of the ladder in no time.

It's like my own business.

Easy.

Convenient.

And everybody likes.

Mission #3: The Bait and Switch

Uber operates more like a pimp, than a boss.

By calling themselves a "Tech" company

instead of a transportation company,

they are able to call drivers: "Independent Contractors"

and they don't have to guarantee wages or pay health insurance.

Drivers receive star ratings from passengers.

And drivers that fall below 4.4 stars

can be deactivated by Uber.

If me and my girls get drunk

and I wanna cramp 6 of us in a Prius

but the driver rightfully says no,

I can be like, "Ew! One Star!"

Also, drivers don't receive tips.

A highlight of Uber's seamless payment system,

meant that no money is transferred between rider and driver.

That's great! But there's no tip.

By Uber's own estimates

20,000 new drivers sign up for the service each month.

Lured by high signing bonuses and hourly guarantees

but what happens to drivers when Uber goes back on its word?

More than 50 L.A.-based Uber drivers gathering in this North Hollywood parking lot tonight

voiced their displeasure with continued rate cuts by the popular ride sharing app.

None of us have anything against the app.

Aya Valilar has been an Uber driver for a year and a half

but says her take home pay continues to drop.

I've experienced 4 cuts...

...since I started.

It was $2.50 a mile when I started, a year and a half ago

and now we're at a $1.10 a mile.

You can't make a living off of that.

Okay, the best part of all of this,

One of the drivers featured in the video

is now one of more than 1,000 drivers

who've been protesting the company's policies.

Drivers surveyed across the nation

say they're making from about $5 dollars an hour

to $20 dollars an hour.

Meaning if they're working 40-hour weeks,

that's between 10 to 40 grand a year.

Their fares, of which Uber gets 20 to 25 percent,

must also go to:

Gas,

Tolls,

Car Washes,

Wear and tear,

Maintenance,

and Insurance.

Which brings us to

Mission #4: Regulations are for Suckas

In April, Uber rolled out a $1 dollar, "safe-ride" fee.

So after years of operation, Uber has decided to pass the cost of safely running a business onto the consumer.

Here's what Uber says the $1 "safe-ride" fee pays for:

Background checks,

Vehicle checks,

Driver safety education, and

development of "safety" features in the app.

So you're favorite Chinese Food company is going to start charging a...

..."safe-food" fee.

Give me $1 dollar and I make sure there's no rat poop in your egg roll.

So just how air-tight are these background checks?

"I have a 3-page rap sheet"

Reformed California criminal,

Beverly Locke, agreed to help us test the system.

Uber says it does not hire anyone with severe driving violations

or convictions in the last 7 years for violent crimes,

felonies, sexual offenses, drugs, or DUIs.

Locke has priors in California for burglary, drugs, and assault.

And she's still on probation.

Yet, after she filled out Uber's online application

this ex-con, was hired to be a driver.

I would pick somebody up take them to the airport

and my second thought would be to go back to that house, see what's in there.

The Taxi, Limousine, and Para-Transit Association

claims that 30 to 40 percent of a traditional taxi's operation expenses

consists of regulatory costs.

Which Uber avoids.

Most Important: Primary Commercial Liability Insurance

Mission #5: Tricky Terms

Uber claims to carry a $1 million dollar umbrella policy

for instances of accidents with passengers in the car.

But,

drivers who are on the way to pick up passengers

or merely have the app open

may not be covered.

Also,

Uber claims

They're not liable for passenger injuries

based on the app's Terms of Service.

Ya'll should probs read that.

Probably the most eye-opening thing I learned

is that Uber ex-drivers, regular people, like you and me

who use their own cars and have personal motor vehicle policies

are specifically excluded from instances of driving for profit.

Call your insurance company right now

and tell them you want to pick up strangers.

For money.

Let me know how that goes.

Uber says,

"We have nothing to do with them."

"We're just an app."

"We do not...

...hire these drivers."

"They're independent contractors."

"We do not control them."

So, basically what people don't know is that, if you get hurt by one of these cars

Uber's gonna go: "Not me!"

"Got nothing to do with me."

Your private automobile insurance...

...coverage will say, "Look, this is a commercial trip...

...we're not covering it."

Lyft.

Uber.

Will say...

"Look, the app was not on, we're not covering it."

Standard, private passenger auto policy specifically excludes

you know, coverage for any kind of injury or damage

that arises out of an accident while a driver is holding themselves out for hire.

Either drivers aren't aware of that, 'cause they haven't read their policy

or they're aware of that and they're just hoping for the best.

Think "Bait & Switch Hiring", "Dodging Liability", and "Unstable Wages" are bad?

Meet...

Mission #6: Subprime Sweet Spot

Uber has now decided to dip their toes into the sub-prime loan market.

YAY!

Uber's financing program connects drivers with poor credit to auto lenders promising better rates.

The startup wants more drivers with nicer cars

so drivers are urged to take out loans

with the promise that car payments

can be deducted from their Uber earnings.

Risk?

"Ah! You're gonna book 6-figures this year! No problem!"

Welcome the Uber Financing Platform!

Drivers are the engine of the Uber network.

Without you, we just wouldn't get anywhere.

That's why we're making it easier than ever to drive your own vehicle.

And be you're own boss.

With Uber's preferred financing program

you can buy or lease a car for as low as $20 dollars per day.

Even if you've been turned down for a loan before.

Even if you have bad credit or no credit at all.

We can help you get behind the wheel in a week.

Two of the companies Uber has partnered with

are now under investigation by the Justice Department for Sub-Prime lending.

Uber is operating like quite the "Car- Tel"!

Mission #7: Eliminate the Competition

Uber's at war with rival startup Lyft.

Uber's aggressive tactics reflect the fact that ride-sharing

is a Zero-Sum game.

A driver picking up an Uber customer

can't also pick up a Lyft customer

Drivers can drive for both services,

though companies discourage the practice.

Plus, once Uber infiltrates and transfers drivers from one platform to theirs

the request rate for that service declines.

According from a report by CNN,

Car service competitor, Lyft,

claims that Uber ordered and cancelled thousands of Lyft rides

in an attempt to blow past the competition.

The outlet says, according to data provided to it by Lyft,

nearly 200 Uber employees have made & then cancelled more than 5,560 reservation since October 2013.