Uber dominates US startups with a market cap of $68 billion.
CREDIT: Getty Images
Despite its high-profile public relations meltdown over the past few months, the story of Uber’s rise is still a fairy tale in the startup world.
In less than a decade, the ridesharing platform has become the most valuable startup in the US, with a market cap of $68 billion. But, like every great story, Uber started from humble beginnings.
Back in 2008, when UberCab (as it was known) went looking for outside funding, they were a simple 3-person operation with a meager 15 clients. To put that in perspective, the company now has over 6700 employees and completed its 2 billionth trip last year.
So how did it all start? Luckily for any aspiring entrepreneur, Uber co-founder Garrett Camp recently released Uber’s first pitch deck ever, and it’s full of lessons and psychological tricks for any startup looking to disrupt major industries and become a billion-dollar business.
Start with the ‘why’
Uber’s original pitch deck starts by answering the most obvious question investors have: “What’s wrong with the current system?” By quickly showing how expensive and inefficient the taxi system is, Uber justifies their business model and positions themselves as a viable alternative.
Solve a problem people actually have
Paul Graham, founder of the Y Combinator startup accelerator explains how successful business ideas have three things in common: “they’re something the founders themselves want, that they themselves can build, and that few others realize are worth doing.” Uber ticks all those boxes in their deck, showing how they’ll solve problems the founders have (like pre-scheduled airport pickup or getting to the bar without driving) and highlighting their own technical skills.
Show you’re part of the in-crowd
The best way to know your ideal customer? Build for yourself. Uber was originally built as a budget limo service after the founders ended up spending a small fortune getting around on New Year’s Eve. So it’s safe to say they know who they’re marketing to, and they show that in the deck. Their original business plan used only luxury vehicles and was based on creating “the best end-user experience possible.”
Design for laziness
People are inherently lazy. We want to use Netflix instead of going to Blockbuster to rent a movie. Uber knew this from day one and focused their deck on showing how the service reduced user friction through one-click pickup, cheaper prices (to make you want to use it more), GPS tracking, and the chance to rate drivers to promote exceptional customer service.
Play into our need to belong
Humans crave belonging, and Uber’s original pitch deck promoted it as a “members only” premium service where you needed to be invited by a current member to use it.
Leverage FOMO
It’s hard to resist an opportunity, but Uber knew that when a deal looks too good to be true, it probably is. That’s why their deck included a best-case scenario of leading the market and capturing $1 billion in yearly revenue along with a “realistic success scenario” of $20-$30 million a year. The company reported $6.5 billion last year, so it looks like even their original best-case scenario was off (in a good way).
The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.