After the Car Crash - <AUTHOR> http://www.hackerfactor.com/blog/index.php?/archives/282-After-the-Car-Crash.html

<comment><USER2> I've worked as an ER/Critical Care nurse for 15 years, and this author is correct in saying that health care costs in this country are particularly opaque. I have absolutely no idea how much the stuff I do costs. That can be a good thing as well as a bad thing. I'm not tempted to ration care at all because someone doesn't have insurance. So, if you get sick, we take care of you regardless of ability to pay. We have to, it's the law.

But, the other part of the problem, is that people without insurance often come to the ER when they are ill, because they haven't established a relationship with a doctor or clinic. So, when they get sick, they go to the ER and purchase the most expensive care possible for their earache or sore throat.

Think about it, in the ER, we are trained and prepared to save lives in a heart attack, keep you alive long enough to have an operation if you get shot in the chest, or administer antidotes in case you get bitten by a rattle snake. We have all that equipment lying around just in case, and we're trained to use it. But, many of our patients have ear infections, runny noses, back aches and sore throats. Not exactly cost effective care.

A big reason for the lack of transparency in hospitl billing is that there are different tiers of payment depending on insurance. The hospital negotiates different rates with different categories of insurers.

Out of network private insurance pays full price or at times refuses to pay full price. In-network private insurance generally negotiates a 70-80% rate. Medicare and state public insurance generally pays a 15-50% rate. Non-Insured patients get billed at the full rate, but generally only 20-30% of those people fully pay their bills. So, many hospitals will give you a discount if you pay cash within a month or two of your visit.

Also, doctors aren't able to bill by the time they spend with you. Because of Medicare, the whole industry pays per diagnosis. So, if you get diagnosed with a pneumonia, Medicare pays a flat rate no matter how long you stay in the hospital, either 1 day or 10.

Finally, most hospitals, if they are making money at all, are operating on a 1-2% profit margin. It doesn't take much for them to go under, and they often need and get subsidized from the state or federal level.

15 years ago, I was very Conservative politically, thinking that market forces would sort it all out. But, the longer I work in health care, the more I think that we should just go to a single party payer system. I actually think that it would actually _eliminate_ a lot of bureaucracy and cut a lot of costs. It'd be a hard sell in this country, though.

<comment><USER3> _Think about it, in the ER, we are trained and prepared to save lives in a heart attack, keep you alive long enough to have an operation if you get shot in the chest, or administer antidotes in case you get bitten by a rattle snake. We have all that equipment lying around just in case, and we're trained to use it. But, many of our patients have ear infections, runny noses, back aches and sore throats. Not exactly cost effective care._

That's one of the biggest goofs of the American medical system. Trying to treat catastrophic care and routine care in exactly the same way makes it difficult to craft a system that works. The right insurance policy to pay a $50,000 accidental injury claim is not the right policy to get $25 worth of tetracycline. In trying to combine an _insurance policy_ against large unforeseen medical costs with a prepaid, tax-free, employer sponsored routine care _spending account_ , we've created an ungainly monster that just about does neither. Like those ridiculous "boat-cars" they tried to build in the 60's. Look! Its a boat and a car! No, its a car that barely drives and a boat that barely floats.

</comment></comment><comment><AUTHOR> Just to kick this one off, I have had no health insurance for almost 15 years and go to a doc in a box when absolutely necessary. "Why that's insane!", you say. No, the US health care system is insane. This was immediately obvious to me when I emigrated to the US from Canada 20 years ago. The biggest hindrance to entrepreneurial activity in the US is the health care morass. I was discussing this with a friend 4 days ago. He just graduated college this past spring semester and longer has school mandated coverage. Hours later he took a mallet to the face playing bike polo and went to the emergency room where they told him that just to look at him would cost 400 dollars. Any services would would be more and they did not know how much more until he agreed to pay the 400 bucks. Fortunately a mutual friend is a nurse and he was able to text him and get a surgeon to unofficially give him a look over and let him know he did not need stitches. He was not convinced when first discussed the issue but less than 24 hours later he agreed based on his new experience as a member of the newly uninsured.

<comment><USER4> As a Canadian who will be moving soon to the US, can you give me some advice re: medical care? I'm looking into buying health insurance above and beyond what my employer is offering (which is quite honestly extremely poor).

I find the entire thought of the health care system being private to be completely unnerving, and as you put it, insane. Why a man has to worry about his bodily well-being to the extent that if he has to give up his life savings for an accidental injury is confusing to me. This hardly even seems _civilized_ , much less _wise_.

It not only makes no sense individually, it is also insane as a whole - by not covering preventative care for everyone you are _increasing_ the virulence of your disease outbreaks, and even in non-contagious diseases and conditions you're still spending much more money in the end than if you nipped the problem in the bud via regular checkups and whatnot.

I know most of HN is American, and you have to excuse me for saying this, but as someone who's never lived long-term in the US your health care situation seems like something out of a bad dream. I cannot imagine the fear that you guys live with - the fear that I'm about to face in a couple months time. Oy.

<comment><USER5> If you move somewhere Kaiser Permanente serves, I've been very happy with them. For all the histronics about how bad the health care system is in the US, I've found the care is quite good if you do some research and are willing to pay for it. My policy is about $250 per month, covers all emergency and severe horrible things, I can visit my doctor within a few days of scheduling, I can get a metabolic panel and have the results emailed to me for $10, etc.

<comment><USER4> Looks like Seattle isn't covered by them - any other suggestions for providers? I've looked at Blue Cross, but I'm really quite clueless when it comes to which ones to go with and which ones to avoid. Any help would be awesome.

For the record, the company's offering is through Aetna - and my brief overview online comes up with some pretty bad horror stories. What's the general impression of them on HN?

<comment><USER6> I had them for a couple years through my last employer ("AHF POS II" policy in California, FWIW), with some moderate medical expenses, and I have no complaints.

When I had to buy insurance on my own I ended up with KP after similar online research, scared off by the stories too, but there seem to be horror stories about _all_ the providers; as far as I can tell, at best you can only choose a lower probability of them.

</comment></comment></comment></comment></comment><comment><USER7> The tech sector had a crash (remember that one?!) and it was not based on decades of old technology. I fail to see how the banking sector is based on decades of old technology. If you ask my friends at GS or Citadel (who went to CMU for CS), I think they'd give you an earful for that line. It could be argued that the bubble was amplified by technology that made it easier to bundle and trade CDS's. Once we snip that bit, it becomes:

 __They lack transparency; they are overly complicated industries. __

It should not be difficult to see how this encourages bubbles. In such industries, it'd be difficult to guess the real value being created, and we know from psychological research that people are apt to create speculative bubbles even without being given this nugget (see<http://en.wikipedia.org/wiki/Herd_behavior>).

<comment><USER8> "The tech sector had a crash (remember that one?!) and it was not based on decades of old technology."

Was it?

I've heard a rather compelling argument that the cause of the 2001 recession wasn't Sept 11 or the dot-com bubble, but the huge drop off in corporate IT spending after Y2K. The enterprise software market enjoyed a huge run-up from 1996-2000 as enormous companies replaced their aging COBOL mainframes with new Y2K-compliant enterprise Java systems. Most of the Indian IT consultancy market owes its existence to this, and many other domestic firms (notably Sun Microsystems) also benefited heavily from it. The consumer dot-com bubble was a relative sideshow compared to this. And enterprise software is about as price-opaque as you can get.

When Y2K rolled around and nothing much happened, all that spending evaporated. Suddenly, all these companies that had hired a bunch of mediocre Java-monkeys to do quick Y2K fixes found themselves without customers.

It does seem a bit different though; in the examples he cites, the industries themselves collapsed, perhaps because of outdated technology and lack of transparency. In the tech industry, the tech industry's replacement of its own outdated technology created a huge bubble, and then collapsed once that bubble was no longer necessary.

<comment><USER7> Wow so that Wolfram Alpha thing is good for something huh? :D

Still, the raw numbers don't paint an accurate picture of what the early US was like. Consider this:

<http://en.wikipedia.org/wiki/Second_Battle_of_Franklin>

Tennessee was once considered to be "the West". Gives you an idea of how settled the country was at the time, and the difficulty of crossing the Appalachians in those times.

</comment></comment></comment><comment><USER9> "Text based and code numbers? That's like my insurance company -- but half of their software now has a GUI. (I'd also put my bank in there, but they got rid of their text-based system two years ago.) My optometrist and dentist both use paperless systems with pull-down menus (no code memorization) and intelligent forms. But the local hospitals? They seem to still use text-based entry forms circa Windows95. Sounds like old technology to me... It's enough to make a guy sick."

Whether an application is text based or GUI has nothing to do with how effective it is.

Paperless, pull-down menus, and intelligent forms can be programmed either way. In fact, many text-based systems are much more effective than GUIs because they are simpler; the user never has to worry about the mouse.

I have personally "deconverted" 3 large scale systems from GUI back to the original text based system, then enhanced those systems to do what was needed. In each case (which flushed over $10 million down the toilet), the PHBs thought the move from text to GUI would magically solve all their problems.

Too bad those PHBs knew nothing about systems analysis, business processes, or project management. Apparently, neither does OP.</comment>


Why Uber Won - <AUTHOR> https://news.greylock.com/why-uber-won-5598a2a66561#.hz33sst9k <comment><USER2> This article is built on the premise that Uber "won," but fails to define winning or back up this premise with facts.

Does winning mean beating its competitors? In San Francisco, at least, this doesn't seem clear at all. Most people I meet -- both drivers and passengers -- prefer Lyft to Uber because they claim it has better technology, a better brand image, better treatment of employees (correction: drivers), and fewer instances of creepy and offensive behavior from its top management.

Does winning mean expanding faster than its competitors? This rests on the VC assertion that Uber is playing in a winner-take-all space. The fact that they can't starve out the competition on their home turf challenges this assertion. Unless they can put up artificial barriers once they enter new markets, they might just be clearing the way for their competition.

Or does winning mean transforming from a VC-fueled startup to a self-reliant profitable company? Once again, no facts in the article, but they did recently claim they'll be profitable in the U.S. in Q2 2016 (although losing $1B/year in China) [1]. But unless they can differentiate in terms of price or service (which, my experience, they've failed at), this isn't necessarily a sustained win.

[1] [http://fortune.com/2016/02/18/uber-profitable- us/](http://fortune.com/2016/02/18/uber-profitable-us/)

<comment><USER3> Uber has actually created the market for new competition to enter. Since they can't stop their drivers from driving for a new competitor, all any new competitor needs to enter the market is an app and a lower price / bigger split with the drivers. Given any new competitor will not be carrying the capital costs of building the network in the first place they will be able to outcompete uber. The eventual winner is going to be the consumer as the market becomes a profitless commodity service.

I have to say that I am surprised that uber didn't use the driver lawsuits to lock up their network. If the drivers were employees then they could have prevented them from driving for other services.

<comment><USER4> > If the drivers were employees then they could have prevented them from > driving for other services.

This. I feel like this doesn't come up often enough in discussions about whether drivers should be considered employees or not. A lot of people seem to think that making drivers employees would be better for the drivers and have no effect on passengers. But as soon as drivers become employees it's game over for Lyft or any future competitor, and Uber's monopoly will let them push driver comp as low as possible. As long as Uber and other companies have to work to attract drivers and passengers they'll take a lower cut for themselves.

<comment><USER5> Surely Uber's reason to exist is to be ready to take over as soon as robocars are good enough. In a world where taxis are cheaper than owning a car, the winner is the one with the software and userbase that can organise the most journeys efficiently, offering discounts to merge rides, running buses and trains when enough people want to go from the same A to the same B

<comment><USER3> This explanation presupposes that running a ride share business is a good entry point for running a robocar business. On the face of it the requirements for running these two business appear to not have much in common.

</comment></comment></comment></comment></comment><comment><USER6> Did Uber really win yet? They haven't exited yet. Their valuation is insanely high and they are not looking to IPO, as they won't get a favorable price in todays markets. They are spending billions in China where they are not leaders yet (and unlikely to be). I don't see how they have won yet. They are walking a dangerous path with no exit in sight.

<comment><USER7> Not all companies look for short term profits over long term viability. Why exit at all?

<comment><USER8> Because VCs want their money back before they're dead.

</comment></comment></comment><comment><USER9> Is Uber about to go public? I'll believe it has won once we see some more numbers.

I am baffled how they operate here in Taiwan. Uber has been declared illegal here. Drivers and passenger are issued fines when caught. Uber fully compensates them. Now the laws are more strict; if a driver is caught 3 times, his license is revoked. Yet there are still 5 cars within 5 minutes of me at any time of day.

I don't understand how that works at all. It does not seem to be a good way to get into the good graces of a country. I wonder how many places Uber operates illegally and pays fines, and how analysts use this to calculate the future value of the company. Do they assume Uber will one day be made legal in all these places? That would boost the valuation but I'm not sure it's accurate.

<comment><USER10> They want you to use the app and get the brand out there. They don't care about fines because the end game is driverless cars.they will later on replace all the drivers .

<comment><USER6> They'll run out of liquidity long before driverless cars go mainstream. There are huge legal and logistical hurdles to face.

</comment></comment></comment><comment><USER11> Maybe I'm misunderstanding the author's point but I kinda disagree that Uber has created a 'network'. To me, it's more of a commodity service. My use of Uber doesn't really increase it's value for other users. At least compared to something like Facebook where network effects are obvious.

I also think it's too early to call the game. They're doing well but again, with a commodity service, it doesn't take much to fall behind. I see the logical end game here as more of a marketplace where I can request a ride and anyone can bid for for the job.

<comment><USER12> Your use of Uber does increase value for other users. Every incremental user increases the probability that someone will need a ride at any given moment, allowing fewer drivers to profitably service an increasing geography. This means better service, on average, for the network.

Another benefit is every incremental passenger increases the utilization of the current assets, spreading fixed asset costs around to more rides.

<comment><USER13> Yup, I. Economics this is called a "two sided market" network

</comment></comment></comment><comment><USER14> Investors love to spout this stuff. Unfortunately, it really isn't true (even though as a founder who generally prefers to bootstrap, I wish it was.)

FTA: > If the cost of customer acquisition (CAC) is greater than the lifetime value (LTV), a startup can grow itself to death.

Oh, you mean like Salesforce? No, wait, they had an IPO and they _still_ only rarely show a profit. And they hold their LTV very close to their chest, so we still have no idea if CAC is lower or higher than LTV.

> When investors talk about growth, we're talking about sustainable growth.

No, you're not, because you continually fund companies that do the opposite. Salesforce, Webvan, Pets.com from the first boom. Instacart, Uber, Lyft, WeWork, HubSpot from the latest.

> The period of cheap capital and billion dollar checks has ended.

Same thing we heard in 2001 and 2007.

> In this capital constrained market, buying scale is no longer going to be a > credible lever for the next generation of startups. ... Companies can no > longer look to money as a performance enhancing drug for scale-up.

Until it is again. It wasn't OK to "buy scale" in 2001 or 2007, but it was in 1997-1999 and 2012-2014. And now in 2016, it's fallen out of fashion again.

Either we're going to have a raging depression, or the bubble will inflate again. Hypothetically, _both_ of those scenarios could actually happen--a depression followed by bubble inflation yet again.

This is why I suggest that founders tune out the idiocy and focus on building a sustainable business. You probably won't build an Uber as quickly as Uber did. But you'll be hugely protected against the inevitable downfall, and won't find yourself cash-strapped and forced to switch gears quickly (notice Uber now singing the "we plan to be profitable in most U.S. cities this year" tune.) And, more importantly, you'll have built a life for yourself, your employees, and their families that are depending on you.

<comment><USER15> Thank you.

I love it when I read an article, generally agree with it, feel like i'm wiser now, and then read the comments and someone like you shows me I automatically agreed with the author without thinking about it too much.

Gotta work on my critical thinking. Any recommendations on what to read?

<comment><USER16> I don't know if there's something you want to read so much as just have a higher awareness of the active processes in your head. When you agree with something, have a hook that asks why you agree. When you want something, have a hook that asks why you want it.

This sort of awareness takes time to build, much like building muscle at the gym.

<comment><USER15> But how to I train to be more aware? When I work out I have a plan of execution - various exercises. I need awareness exercises.

<comment><USER17> Have a plan of execution for every article you read.

<comment><USER18> Just one? I think you need a plan A and a plan B, and, for some of the longer articles, a plan C wouldn't hurt.

:)

</comment></comment></comment></comment></comment></comment><comment><USER19> An interesting parallel is baseball.

The Yankees are infamous for using money as a tool, buying up as much talent as they could.

In recent years, the Dodgers have outspent everybody, but in an absolutely different way. 25% of the Dodgers payroll goes to players not playing for the Dodgers. Often, it's going to players playing against the Dodgers. Many commentators have described this in similar terms. They use their deep pockets a s a weapon. Instead of giving their players huge salaries, they on multiple occasions have found teams struggling with expensive contracts for underperforming players. They negotiate to take the player (and the bad contract) and then require some talented youngsters to be thrown in on the deal. They then trade away the underperforming player to another team, subsidizing the contract substantially, and keep the talented prospects. While some of these trades didn't pan out well, it was a pretty unique way to use deep pockets as a weapon.

<comment><USER20> > _An interesting parallel is baseball._

It's funny you choose baseball as the sporting example, as it's without a salary cap.

If you look at hockey and basketball, this has been a strategy for a long time because teams _have_ to remain below the salary cap. As such, bad contracts are traded around all the time to make room for payroll. Stars sometimes change teams for essentially nothing but cap space.

I guess it interesting that a baseball team is doing it in a world where there are no spending caps.

<comment><USER21> Baseball implemented the luxury tax system, which operates at a soft cap. So while it's technically accurate to say no salary cap, there does exist a financial mechanism by which team payrolls (and by association, player salaries) are limited.

</comment></comment></comment><comment><USER22> I wanted to know if I'm the only one who doesn't find these apps convenient. I'm in NYC and have been trying to use Uber and Lyft, but I keep finding that whenever I request a ride, the driver usually takes too long to get to me (e.g. gets lost and goes the wrong way), and in that time I see like 20+ taxis drive past.

Why would I wait 5-10 minutes for an Uber/Lyft when I could, in the same amount of time, be closer to my destination by just hailing a regular taxi?

Surely I'm not the only person experiencing this. I want to love Uber/Lyft, but so far my experience has just been one of hassle and inconvenience. I was motivated to try them out because of free credits, and I'm trying to use up my free rides before they expire, but it's just been too painful so far!

<comment><USER23> Biggest reasons for me:

1) Driver and I agree on a best route via mapping software, no more getting lost, miscommunications or malicious route designed to get more money out of me.

2) Payments are clear and fast. No more getting pressured and hounded for cash when I only cary my card.

3) It's always a clean nice car. No more duct tape over check engine lights.

4) I know if there is ever an issue I know it's going to get taken care of instantly by Ubers excellent staff. No more terrible customer service.

<comment><USER24> #2 is going to change for you soon. As part of a lawsuit settlement, Uber is going to allow for tipping, and the drivers will be allowed to ask for a tip in cash at the end of the ride. It's going to be awkward and a real shock to early Uber users.

<comment><USER25> Easy solution to that problem: Solicit a tip, get 1 star. Uber is far more likely to keep me around as a passenger who pays the published rates and uses them frequently than a driver who continues to generate complaints from users due to tip solicitation. They can easily replace drivers with ones who won't do that.

<comment><USER24> Most people will just concede to tipping with cash and it will be the new norm.

<comment><USER26> Who on earth is carrying cash? I'll give one stars to any driver asking for tips in cash.

<comment><USER27> I think you are still in minority about not carrying cash. Also the drivers rate you as well. Pretty sure you will be the one kicked off for low rating before the drivers.

<comment><USER25> I suspect the risk of a paying customer getting kicked off the system is far lower than a driver who provides an off-brand experience.

</comment></comment></comment></comment></comment></comment></comment></comment><comment><USER28> Post success analysis have one serious flaw. Theory should explain not only why Uber won but why Lyft lost. Assuming that some competitor would do the same as Uber regarding their strategy but without having to change laws/work on PR needed for drive sharing - why Uber strategy cannot be copied?

<comment><USER29> Also, it's not even clear that one of them has won or lost yet. Lyft is still going strong, and uber is now having to make major changes to how it deals with tips. It's too early to write narratives for this.

<comment><USER30> Exactly. As a point of reference, Uber entered Russian market which already had various competing providers such as Yandex.Taxi and GetTaxi, and did not gain significant advantage.

</comment></comment></comment><comment><USER31> The article says Uber "won" by spending heavily to get 5 minute response and $25/hour driver pay. They no longer provide either of those, because they couldn't do so profitably. Uber might still be the next Webvan.

</comment><comment><USER32> Am I the only one who was slightly ticked off by this guy's writing style?

It was riddled with terms like "arb", clearly written for self-satisfaction. If my life was wrapped around the VC universe, I probably would not care to read this article, and yet for anyone who isn't so familiar, you need to interrupt the reading several times if you want to understand what he is talking about.

The conclusion of the article, hinted at the beginning, seems to run abrupt without fully explaining itself.

</comment><comment><USER33> Is capital really getting more expensive? Aren't we still seeing truckloads of cheap cash still getting shepherded into private tech companies?

It sounds to me like this investor would _like_ to see a return to investments in profitable companies rather than aggressive investments in growth, because it was more fun for him when he had fewer competitors willing to throw money around. Is there any evidence that this trend is actually reversing as opposed to just being wishful thinking?

</comment><comment><USER34> Has uber won? When? Did the rest of the market get told? Given the fact they are still embroiled in legal wrangles worldwide, still throwing a billion dollars a year into a hole in China, had to recently settle a large case with their drivers, face competition from Lyft as their friendlier rival, from lady only driver firms to deal with rapey and gropey uber drivers, overall, sounds like a winner. Or does it?

<comment><USER35> Indeed I'm not sure you can say Uber has won until they maintain market dominance without having to throw in more investor money. It's pretty hard to compete with them when they are subsidising fares but when they stop maybe less so.

</comment></comment><comment><USER36> I am traveling right now in India, and Uber is a huge boon: no more haggling, no hassles, no arguing: just call up Uber and go. I've been making it a point to ask the drivers what they think about Uber. The interesting part is, when Uber first came to town, they would offer a flat fee: Rupees 60,000/month, as long as the driver kept the app open 10 hours/day, and didn't refuse rides. So many drivers signed up, that many of them spent the entire day just hanging around, giving 2-3 rides/day. So Uber outspent the competition heavily, taking huge losses. But now, with the glut of drivers in Uber, their payment has gone down significantly: they pay based on the number of rides a driver makes. For example, for 17 rides, Uber pays about Rs 3000. The problem is: most rides are < Rs 100, so Uber is still offering rides at a loss.

So, the answer to the question "why Uber won" is: by spending lavishly.

</comment><comment><USER37> Uber won because a massive amount of stored trust (capital) was put into it while users were trusting it would do what it said it would do then, now and in the future. Being able to change the business model and not violate user trust, as most software does eventually unfortunately, is much tricker. Saying they "won" when the game is ongoing is illogical. Post this in 20 years when Uber is still a brand, the customers (and drivers) are still joyful (and the company isn't bringing them suffering) and then you can talk about success.

Huge cash inflections into companies isn't helping user experience. In most cases, the game theory behind the huge cashouts causes user suffering. It's time to think differently.

</comment><comment><USER38> I think the main reason Uber "won" is because starting off with the black cars was a much more effective launch approach. As everyone knows, 2 sided marketplaces are very difficult to build. Uber solved this by stocking one side with a pre-existing, semi-organized group of providers. After hooking all the riders, UberX became much easier.

Coupled with Uber's more aggressive practices.

<comment><USER39> _I think the main reason Uber "won" is because starting off with the black cars was a much more effective launch approach. As everyone knows, 2 sided marketplaces are very difficult to build. Uber solved this by stocking one side with a pre-existing, semi-organized group of providers._

That's a very astute observation.

Anyone have any ideas of other markets(or potential markets) where such an approach could be translated?

</comment></comment><comment><USER40> Does anyone else find the first chart in this post ominous? 2014-2015 is looking a lot like 1999-2000, and nothing seems to suggest things are that different this time around...

</comment><comment><USER41> Great explanation of how Uber could get so big. I never really understood why Uber made it and nobody before, because the App itself does not seem like a revolutionary idea. There must have been apps like that around already and lost of people must have thought of it. I mean I certainly thought of this long before I heard of Uber.

But the missing piece of the puzzle, which this article filled in was that it was never really about the app. It was about using money cleverly to get this thing going.

Now Uber has first mover advantage. But I can see many potential problems for them. They have advantage in name recognition and momentum but I can't see much else advantage.

The tech should be easy to replicate. So I think what will matter in the future is who manages to figure out the best way to use autonomous vehicles.

In this regard I'd rather place my bets on Tesla. If they as they hinted get into doing Uber like stuff in the future with autonomous cars, they have a clear advantage as they got advantages in more fields than Uber which can enhance this particular business.

By controlling the cars, they are pulling in more data than anybody else on autonomous driving at the moment. They are already beating the master data collector Google, collecting more data then they do in a year on autonomous driving.

</comment><comment><USER42> I don't fully understand the conclusion that "the period of cheap capital and billion dollar checks has ended." Uber won in a unique market place primed by underutilization of personal vehicles and widespread customer dissatisfaction with taxi services. There's even an argument that the so-called gig economy is mostly Uber and its competitors. [1]

So yes, companies in less valuable markets are going to have a tough time getting funding as VCs pull back. But it does not follow that if you found an equally valuable market somewhere else you would not have access to funds to make it big. There's still a lot of money out there looking for good investments. I don't see a complete downturn as predetermined without some other externality at play.

[1] [http://blogs.wsj.com/economics/2016/03/28/the-entire- online-...](http://blogs.wsj.com/economics/2016/03/28/the-entire-online-gig- economy-might-be-mostly-uber/)

</comment><comment><USER43> In SF the quality of Uber's service has dropped so dramatically in the past 3-4 months that I no longer use it anymore. It's completely commoditized and I have no qualms about switching to Lyft when they have a better product.

<comment><USER44> Curious what you mean by the quality of service dropping? I use both Lyft and Uber pretty regularly (multiple times a week) and have had only positive experiences in SF.

<comment><USER43> It started out awesome but recently I've had:

1) I can't see estimated time but lots of cars around. I then book and it estimates > 12min wait time. If I cancel, it charges me $2 anyway because reasons. 2) a number of drivers cancel after 10 min of waiting - this happened 3x in a row a few weeks ago so I finally got a car after 40 min. ...

Friends with similar experiences...

</comment></comment></comment><comment><USER45> What is an "arb"?

A quick google didn't do it for me :(

<comment><USER46> arbitrage

<comment><USER45> That's what Google returned but I didn't think it made sense in the context. I guess he means to say you can trade one for the other? That doesn't make sense to me to be honest. I did like the article though.

<comment><USER47> I think the author is using "arbitrage" a bit loosely/metaphorically, as "a new opportunity that seems low-risk that has only just appeared, and, being such a great opportunity, will thus likely only exist briefly till the first few actors exploit it till it's not really an available opportunity anymore"

The looseness comes from the fact that traditionally an arbitrage opportunity really is theoretically nearly zero-risk while I think the author is using it here in cases where it's a bit more complex. But the analogy at least works in highlighting the aspect of these opportunities being temporary in their existence, like the joke about an economics professor and student seeing a twenty dollar bill on the ground and the professor ignoring it, quipping "If that was a real twenty dollar bill, someone else would already have picked it up off the ground"

</comment></comment></comment></comment><comment><USER48> So many bandied acronyms. CAC?

<comment><USER49> It stands for customer acquisition cost.

</comment></comment><comment><USER50> Still remains to be seen what the long term costs are to be an Uber driver. They are probably not that favorable when considering depreciation, insurance, etc. Most likely there will be a slow exodus of drivers until the market reaches equilibrium and Uber et al are not so distinguishable from traditional taxis.

</comment><comment><USER51> I didn't see any comments mentioning self driving cars, which to me suggest a cleaving of uber's marketplace. If all cars were to suddenly become autonomous, uber could be easily bested because their liquidity has become beside the point.

</comment><comment><USER52> Uber is a simple service, for which competition is natural, in theory.

If in practice this turns out to be different, then this is a failure of capitalism, and somebody ought to do something about it.

</comment><comment><USER53> I wonder if the "easy money" period is over or just resetting. There still aren't very many ways to get "good" returns on cash at the moment.

</comment><comment><USER54> I think the more interesting story isn't how Uber won but how Lyft lost.

Sidecar was actually first out of the gate with a ridesharing product but Lyft wasn't far behind and soon clearly dominated the space with their ingenious pink mustaches. Sidecar suffered from a classic first mover's disadvantage in that they were overly concerned with regulatory risk which made them too timid. Sidecar's opinion was that the mustache overstepped the bounds between employer/independant contractor and that the CPUC would slap down Lyft and put them out of business (similarly, the bid model that Sidecar used was driven by similar concerns despite the noticeably poorer user experience).

I've never seen a product achieve such ferocious product/market fit as Lyft did. During its first year, it was extremely common for there to be hours at a time when drivers were immediately snatched up as soon as they ended their last ride and passengers would wait for half an hour at a time, eagle eyed staring at the screen to snatch up a car. The level of inconvenience that people were prepared to put up with just to use Lyft's product spoke to just how much of a radical upgrade in user experience ridesharing provided and a hint as to the explosive growth that was to come.

Lyft was in the enviable position that they held a near monopoly in this space for almost 18 months as Uber tried to reconfigure itself and I remember hearing Travis speak about how the cheaper Uber would be Uber and being skeptical that he could ever overcome such a huge first mover advantage.

In the face of all of this, Lyft could have made the "standard" startup decision of prioritizing growth above all else and taking whatever compromises were necessary to service that growth. Instead, Lyft took an alternate path in which they placed driver quality as a longer term priority. I remember during even the most insane supply/demand mismatches, Lyft was still rejecting some 50%+ of driver applicants for not being "Lyft material".

I think against almost any other competitor, Lyft could have made the same choices that it made and come out ahead but Uber's raw ability to execute is something that, regardless of what you think of their ethics or culture, has to be admired. Uber is one of those extraordinary companies that prizes execution ability culturally in the same way that Apple prizes design. Lyft should have rolled out into other cities faster, Lyft should have gone international, Lyft should have dropped its prices more aggressively and taken the hit on driver quality. All of those are recoverable errors unless you're facing up against someone like Uber who rolled out an aggressive expansion plan and then relentlessly executed against it with the wheels barely falling off.

This is all easy to see with the benefit of hindsight but I remember living through that time, with friends at all 3 companies and watching them grope towards an uncertain future while doing the best they could.

<comment><USER55> I quit reading Techcrunch in ~2010, and by that time Arrington had already posted about 'UberCab' many times. So your comment seemed off to me, and I went to Wikipedia: it looks like both Lyft and Sidecar were started _after_ Uber.

<comment><USER54> Uber was offering it's black car service which wasn't really in the same product category. Uber was having moderate traction with but it wasn't the same insane demand that Lyft and Sidecar had. It wasn't until Uber rolled out UberX that it became the monster it is today.

</comment></comment></comment><comment><USER56> Why Torrent Won</comment>


My Day Interviewing for the Service Economy Startup from Hell - <AUTHOR> http://thebillfold.com/2014/10/my-day-interviewing-for-the-service-economy-startup-from-hell/ <comment><USER2> Sexism, racism, homophobia (I assume that's what was going on with the marketing guys and "Josh"), long hours, low pay, "boys club", overbearing/micromanaging boss, unpaid full day "interview", false hope (Seemed like the idea of getting your own franchise was a carrot dangled before them on a stick that they would never get), and little/no structure. Wow.... And these are the companies that are getting funded?

<comment><USER3> I work in startups in NYC. None of the things described are even remotely close to shocking for me - I've seen all of the above first-hand either in offices or at startup events.

That said, I've never seen _all_ those things under the same roof, much less in a single day. The perfect storm of insanity makes me doubt the author's story a little bit, but each of the things she's brought up I've seen.

Shit, I literally just read a racist internal email an hour ago about the new cleaning lady at the office.

Plus the pointless credential-rundown you get every. single. goddamn. time. you meet a startup person in this city. Oh, you went to Harvard 10 years ago? That's so relevant considering we just met 2 minutes ago! You used to work at Goldman and now you're doing a consumer-tech startup? Yeah, that really needed to be in the first 3 sentences you've ever spoken to me.

<comment><USER4> I was on a team trying to setup a spinout company in Australia of all places. My corporate overlords built a team, boy band style, to go investigate the market with a minimum product, really experienced people who had seen and done a lot. About half the team was on their second career after retiring out of their first, but all were brilliant. I think we added it up and there was something like 170 years of experience in my small group (I was by far the junior person on the team).

During the sit down on the marketing meeting a new person was introduced to the team (not unusual). They came up to the group and was obviously another senior, experienced addition to the group, hopefully with a long and interesting career behind them.

They walked up to the front of the group and introduced themselves, "Hi I'm <name>, I went to Yale" and sat down at the table and proceeded to offer nothing of any substance over the next 8 weeks until they were quietly asked to go "contribute" their Yale credentials somewhere else.

I've been hit with every kind of credential wagging since then, "When I was at McKinsey..."* or "When I went to Harvard..."\+ are usually immediate signs of an immensely useless person and I go out of my way to avoid them. It's actually kind of pathetic.

The best people I've ever met actually seemed a bit shy about notable credentials in their past and it wasn't until after months of probing that I could finally learn about some cool job or notable place they went to school.

* I wrote this before reading the article

\+ seriously, it's like a cliche

<comment><USER5> As an interesting side anecdote, I just spent the last 6 months living in Kenya with the same kind of Harvard / McKinsey style crowd except in the social enterprise / NGO space.

As someone who was coming from a very different background to a lot of these people, I wasn't exactly sure what to expect.

While I would be the first to admit that things are less than perfect in a number of ways, generally speaking the people I met and eventually ended up consulting for couldn't possibly be much further from some of the personalities described in a number of the comments here.

Overall I was super impressed with the humility, the intelligence and the general standard that I saw in a lot of these people.

Then again, there is a world of difference between someone who chooses to live on next to nothing in a 3rd world country where they are there primarily to help others and the types described in the article.

<comment><USER4> Thanks for the counter-anecdote. I've met so many people who start the conversation off with a credential drop and then turn out to be useless oxygen thieves that I forget that there really are some smart dedicated people out there with the same kinds of top-tier credentials as attributes who do good work.

 _bad Bane, stereotyping is bad!_

<comment><USER6> As I understood it, it's not the credentials per se you have the problem with, it's the way people bring them up. You two might be talking about different kinds of people.

</comment></comment></comment></comment></comment></comment><comment><USER7> The experience of this CSR candidate is obviously the lede of the piece, but my problem with businesses like this is deeper: I think all these companies that put a pretty UI over a bunch of low-skill 1099 workers are exploitative.

Reread the section about Lupe's attempt to reach the client in time.

I feel like companies in these markets will eventually reap the whirlwind when the USG decides not to allow people filling these roles to be classified as 1099s, and the whole segment falls apart. Or maybe I just hope it.

<comment><USER8> Piketty observes that the rise of the monthly wage was essential to the rise of what he calls the "patrimonial middle class". It gave labor a degree of income stability that they did not enjoy under the previous system of daily wages and piecework.

These startups are essentially converting monthly wage jobs back into piecework jobs. Not satisfied with rolling back the new deal, we're now rolling back the progressive era.

<comment><USER9> > essentially converting monthly wage jobs back into piecework jobs

People who work these jobs never had a monthly wage job to begin with. If you're fully employed as a house-cleaner, why bother with Handy? If you're a full-time black car driver, why even bother with Uber?

This is lead-gen business for industries that tend to have a large amount of self-employed individuals to begin with.

</comment></comment></comment><comment><USER10> Full work day interviews where you do actual work for the company are technically illegal. If you want to mess with them, you can file a suit in small claims court for whatever hourly rate you feel like, and it'll be a huge pain in the ass unless they settle and pay you quickly :)

<comment><USER11> It's also illegal to require employees to use their own devices and not compensate them for that use.

<comment><USER12> Is that actually illegal? I think it's really crappy, and no company should do it, but I'd love to see where this is codified as illegal.

<comment><USER13> California passed a law about that I believe. An excerpt from this [1]:

Section 2802 of the California Labor Code requires employers to reimburse employees for expenses "necessarily incurred" with the stated purpose of "prevent[ing] employers from passing their operating expenses on to their employees." Lest anyone think this issue can be resolved with a waiver of the right to reimbursement, Labor Code section 2804 prohibits waivers of an employee's rights to reimbursement.

[1] [http://www.dlapiper.com/en/us/insights/publications/2014/08/...](http://www.dlapiper.com/en/us/insights/publications/2014/08/bring- your-own-device/)

<comment><USER12> Awesome, thanks!

</comment></comment></comment></comment></comment><comment><USER14> I don't know why she changed the founder's name, it's pretty easy to figure out when there are only two founders.[1] It looks like Umang Dua, HBS '13[2]. He's on Twitter as @umangdua if anyone would like to ask him about this incident.

[1] [https://www.handy.com/about](https://www.handy.com/about) [2] [https://www.linkedin.com/in/umangdua](https://www.linkedin.com/in/umangdua) [3] [https://twitter.com/umangdua](https://twitter.com/umangdua)

<comment><USER15> Honestly, I thought it took a lot of gall to even name the startup by name. There's always a fear of retribution even minor.

<comment> steve-benjamins Naming the startup gave this article extra teeth for me.

</comment></comment></comment><comment><USER16> They've responded on Twitter. They don't really mention what they're talking about so you won't understand unless you've read the story. I guess to purposely not connect others to the story

> This is disturbing and in no way represents working at Handy. Companies go > through growing pains and these facts have no bearing on us today

> When Amanda says she applied 1.5 yrs ago, our company was newer, smaller and > still figuring out best practices. Things have changed since.

> We do not stand for racism or sexism of any kind. That kind of behavior is > not tolerated and never will be.

> We understand that our employees and professionals are the lifeblood of our > business and we work every day to ensure their happiness.

They don't seem to deny what Amanda is saying. And I don't see how they can say they've changed if some of those same people still remain...

<comment><AUTHOR> > This is disturbing and in no way represents working at Handy. Companies go > through growing pains and these facts have no bearing on us today

I take issue with this statement the most. The author clearly identifies the CEO, whom is still there, was present when the comments and inappropriate jokes were being made. It's entirely possible the CEO did say something, but I'm guessing based on the tone of the article they did not.

While it's natural for a company to go through growing pains I've never heard it used in reference to office culture how customers are treated. If this was going on 18 months ago it means it's still there today.

<comment><USER17> I saw that as nothing but an admission of guilt. I wonder if the tweet will stay up. I bet their corporate lawyer won't be happy when they see it.

</comment></comment></comment><comment><USER18> I must be old...

I feel like I read stories about horrible jobs and tough times finding work from young college grads regularly and the news would seem to corroborate them [1].

Apparently, these people end up serving coffee or answering phones for clown shop start-ups.

Meanwhile, I know people trying to hire for what I'd consider traditional entry level jobs (clerks, reception, no-risk security, no-experience necessary apprenticeships) offering full benefits plus 35-45k+ salaries who would be overjoyed to see a single college-educated applicant.

What's going on here? Do people believe in this Amway-esque pitch for a "world of opportunities"? Do traditional jobs feel like giving up? Are they too restricting?

1: [http://www.washingtonpost.com/blogs/she-the- people/wp/2014/0...](http://www.washingtonpost.com/blogs/she-the- people/wp/2014/09/05/why-sally-cant-get-a-good-job-with-her-college-degree/)

<comment><USER19> The jobs you mention don't exist. Unless you count prison guards. I know someone who double majored with good grades and is now a corrections officer working with mostly non-college graduates because the only other job opportunities were things like 7-11 cashier.

Also, I know people see a lot of "openings" for "decent" positions, but most of them seem to be fake spam positions from companies that don't really want to hire people considering that every person I know who has ever applied for one has never heard anything back, except for a couple people who've had it explained to them that an opening wasn't for college graduates.

<comment><USER20> > The jobs you mention don't exist

But doesn't it sound like it would be a supremely profitable relationship if such a job _did exist_?

</comment></comment></comment><comment><USER21> Where are all the attorneys? This is a company with flagrantly illegal practices and a ton of money in the bank. People live for that sort of scenario. Anyone let go by these clowns should leave with a nice chunk of change.

<comment><USER22> We've spent the last 30-odd years electing people that stuff the books and court benches with laws and people that make sure that - by and large - attorneys and the victims they represent _can 't_ hold companies like this responsible or accountable - for almost anything, let alone misdeeds with needy victims. Go look up "forced arbitration"... these "service providers" probably have, at best, the right to a loser-pays "arbitrator" who is paid and picked by Handybook. The risk that any of them might opt for any quasi-legal proceeding (let alone the rigged arbitration system they are likely limited to) given that many of them most likely have some kind of liminal citizenship status is effectively nil. If I were doing the liabilities/risk business analysis for this, I would delete the row this was on just to clean up the spreadsheet a little bit.

The concept of companies being held responsible for things they do that hurt or exploit people is a humorous anachronism from a bygone era.

<comment><USER23> It doesn't look like the "candidate/employee" signed anything. And if they did, the contract isn't enforceable without consideration. "We are considering you for the job" is not consideration.

<comment><USER8> The way companies do forced arbitration now is by providing the employee with an opt out form that they have to fill out and mail to the legal department within 30 days.

Sharp-eyed employees will notice this in their new hire documentation but most will not. The company can then claim that they did not make forced arbitration a condition of employment and did give the employee an opportunity to opt out, which they declined to take. Courts have upheld this as legal:

[http://www.dglaw.com/images_user/newsalerts/Litigation_Emplo...](http://www.dglaw.com/images_user/newsalerts/Litigation_Employees_Who_Dont_Opt_Out.pdf)

<comment><USER23> They never hired her. There was no on-going agreement or failure to opt-out.

Again, contracts still need consideration. Employment is consideration. They never employed her.

<comment><USER24> I don't get why the fuck they didn't just pay her a day rate for work, since she was essentially working.

</comment></comment></comment></comment></comment></comment><comment><USER25> Sometimes I wonder if it would make sense for investors to send someone they trust to apply and interview for a position at a company they're considering.

If what she wrote is accurate I don't really understand how they managed to raise $30 million in funding.

<comment><USER26> > If what she wrote is accurate I don't really understand how they managed to > raise $30 million in funding.

Probably covered by the part where the founder was at Harvard

<comment><USER23> It's not unusual at all to find very smart people that just lack the very basic common sense.

</comment></comment></comment><comment><USER27> No surprise here. The first thing a Harvard grad will tell you is that they graduated from Harvard.

<comment><USER28> Interesting. Informally (anecdotally), I think the norm is quite the opposite: _noblesse obliges_ to never drop the H-bomb in conversation --whence the irksome "went to school near Boston" trope [1,2].

It could well be a HBS-only thing, though. They have their own thing going on.

[1] [http://www.thecrimson.com/article/2011/9/15/harvard- students...](http://www.thecrimson.com/article/2011/9/15/harvard-students-go- people/)

[2] [http://www.slate.com/blogs/browbeat/2014/05/30/harvard_grads...](http://www.slate.com/blogs/browbeat/2014/05/30/harvard_grads_say_i_went_to_college_in_boston_and_call_it_the_h_bomb_get.html)

<comment><USER29> In my anecdotal experience, I only find out people I meet went to Harvard when I see them in a school sweatshirt. Or if they write for The Simpsons, in which case I just assume it. Heh.

Wharton grads, on the other hand... Never more than 10 minutes before they drop it in.

</comment></comment></comment><comment><USER30> Still wishing fuckedcompany.com was still around to start collecting stories like this as the bubble starts to pop...

<comment><USER31> Soon there will be an app for that, probably called Unter (Uber for going under).

</comment></comment><comment><USER32> "It will be a full day of work, like an extended interview, and unpaid."

Screw that noise. It is clear from just that they don't respect people's time.

<comment><USER33> I'm pretty certain this is illegal and a violation of the Fair Labor Standard act. [http://www.dol.gov/whd/flsa/](http://www.dol.gov/whd/flsa/)

<comment><USER34> When I interview, I mention that I have to give my present employer 2 weeks notice, whether it's true or not. Then I carefully watch their reaction. Anything other than supportive is a deal-breaker. Either they have integrity or they don't.

<comment><USER35> Could you clarify? I'm confused by what difference does it make what they say.

<comment><USER36> "Of course" \- no red flags.

"WHAT?! We expected you to start tomorrow! Can't you just quit? Don't you want to work here?!" \- Aaaaand, we're done here.

<comment><USER35> I have interviewed a lot, and I have literally _never_ experienced anything other than some variation of "of course".

</comment></comment></comment></comment></comment></comment><comment><USER37> I thought this article was written about a fictitious company as a satire, but after couple of search it turns out that Handy actually exists and has raised quite a lot - as a competitor of HomeJoy?

I don't know if everything there is true, but this article has the indirect effect of making my opinion of michaelochurch going up.

<comment><USER38> Why?

</comment></comment><comment><USER39> I'm not surprised that a company that would treat its service providers so shitty would also treat its employees that way. Between stories like this and the things I hear about other service startups like Task Rabbit it makes me never want to use one of these services ever.

</comment><comment><USER40> Wow! It's good to hear stories like this to balance out the usually euphoric stories around startups. Hopefully this an aberration, not the norm

<comment><USER41> _Hopefully this an aberration, not the norm_

Startups that hire unskilled labor are only pulling back the curtain on the actual job market. If anything you can expect to hear more about it as the tech startup world starts building things that require more staff than an engineering department.

<comment><USER42> I worked unskilled labor in NYC before and during college (and a short time after). I've seen attempts to scam jobseekers, I've been sexually harassed (I'm male) and I've worked for assholes but I have _never_ seen a legitimate employer that was even remotely this bad.

</comment></comment></comment><comment><USER26> This is pretty bad. I'm debating whether it tops the job where I got fired for speaking Spanish, but it's bad nonetheless

<comment><USER43> Woah really? Sounds interesting, care to share the story?

<comment><USER44> Once I was "demoted" for having a bad relationship with my father because someone talked about it with the store manager...

</comment></comment></comment><comment><USER45> > The next step in the process is a tryout day. It will be a full day of work, > like an extended interview, and unpaid. Could you come in tomorrow?

I liked this until the unpaid part. Maybe there are just too many impossible laws and logistics to get around, but I've always thought it would be cool if more companies tried something out like a 10-day contract (paid of course) to make sure the job is a good fit, and so both parties can make an initial decision without as much risk.

<comment><USER46> The reason this doesn't work is that most people aren't going to quit their current job for something that isn't a definite offer of full time employment. Would you?

<comment><USER47> I've never had a salaried job that didn't start off with a "probationary" period of 30 - 90 days. Not sure what the real difference is.

<comment><USER48> And I've never had one that had one...

</comment></comment></comment></comment><comment><USER49> > "I started this company while I was getting my MBA at Harvard. Before this, > I worked for McKinsey & Company…" he paused to gauge my reaction, "which is > one of the top business consulting firms in the world."

I wonder how he would have reacted to my utterly uninterested facial expression. Nothing of that is of any interest when trying to asses his value as a person or if his idea/company is good or not.

<comment><USER50> I enjoy being from Australia and listening to Americans yammer on about their education or work history.

I honestly say "I've never heard of <institution>" \- the reactions are great :)

</comment></comment><comment><USER51> At the risk of saying something terribly unpopular, I've got about six more of these in me, then I'm done.

Seriously. Let's get real. There are what? Say thirty thousand or so startups in the U.S., with ten thousand joining and dropping out in any given year? So if 1% were fuckups, we'd be able to run several of these stories a day. Forever.

I think people like them because it feels good to see young jerks acting like, well, young jerks. Don't we know so much more than them? Wonder how they feel, now, those assholes! You can get the holier-than-thou feeling and you can riff off the righteous indignation. Lots of folks just can't get enough righteous indignation. Then you can sit around and share stories from the good old days.

The problem is, not only can you run these ad infinitum without actually doing more than sharing a ton of anecdotes -- it doesn't lead to any sort of productivity. It gives me nothing to go and accomplish, it offers no insights into what public policy changes might be required to stop it (if it did, it'd be politics, and we don't want to go there). It's just -- nothing. Like driving by a fender bender and talking to the other people in the car about what happened and who must be at fault. A waste of time.

I really wish there was something useful here. Best I've got is "People who don't understand employment law are going to make lots of mistakes"

So I got that. I got that with the first of these.

Maybe we're seeing the start of a new genre, like FuckedCompany. If so, perhaps there's a subreddit for it somewhere? After a few dozen of these, it ain't going to be stuff hackers are interested in, unless they're some pretty monotonous hackers.

</comment><comment><USER52> I'm no lawyer, but: by law, if you are _expected_ to work 12-hour days, isn't the company supposed to pay you overtime? My understanding was that even if you are an 'exempt' employee, if the _expectation_ is that you have to work more than 40 hours/week, you should be paid overtime?

<comment><USER53> I know that to be the case in Pennsylvania and Virginia, as those are the states I've lived in. I believe it to be the case in New York.

<comment><USER54> In the U.S., this is actually governed by a Federal law, the Fair Labor Standards Act.

The U.S. Department of Labor has lots of information about it:

[http://www.dol.gov/dol/topic/wages/overtimepay.htm](http://www.dol.gov/dol/topic/wages/overtimepay.htm)

</comment></comment></comment><comment><USER55> It sickens me how close that article/post is to my experience working for a small business in Auckland, New Zealand.

</comment><comment><USER56> Highland Capital Partners is one of their investors. Prior investments by the firm include [http://www.hcp.com/companies/](http://www.hcp.com/companies/)

</comment><comment><USER57> Not only is this employer acting like an asshole, they're doing it stupidly. They let candidates for employment bring in their own computer and plug it into their internal network. Someone is going to drain out all their internal records.

You can see their web site at "[http://www.handy.com/"](http://www.handy.com/"). The page source is amusing. They seem to be more interested in ad networks than booking actual business.

<comment><USER58> > Someone is going to drain out all their internal records

What could they possibly have worth stealing?

<comment><USER59> That's easy--the answer to where all that $45,000,000 in venture capital funding went!

</comment></comment></comment><comment><USER60> yea, I had bad experiences there too. They are very bad with hiring contract. Really treat employees like bad

</comment><comment><USER61> Have a seemingly decent idea. Build a seemingly workable product. Know people / have a shiny thing on your resume.

Why the surprise at all this? Here in NYC I speak to funded startup founders and employees every other day who lack basic business, business management, and people management skills and experience. Investor actions (i.e. $$$$) seriously devalue these things now.

(But we have advisors!!!!!!!)

/jadedrant

</comment><comment><USER62> This reminds me of the all-too-true joke.

Question: How do you know somebody has an MBA? Answer: They tell you.

Full disclosure... I have an MBA!

</comment><comment><USER63> In general, startups do not follow the professional practices of established companies. When you interview for an established company, they're usually professional and they get back to you afterwards. When you interview for a startup, you can run into all sorts of issues. The founder might not be there, the employees may have no idea what to do with you, or you might just have a 15-minute interview after traveling for 90 minutes to get there. They often won't get back to you. Though this example is particularly bad since they're asking applicants to do unpaid labor.

<comment><USER64> Are you kidding me. If this story was true, this startup was way beyond just unprofessional.

</comment></comment><comment><USER65> > "Congratulations! Ajay thinks you'd be a great fit. The next step in the > process is a tryout day. It will be a full day of work, like an extended > interview, and unpaid. Could you come in tomorrow?"

This may be a violation of wage and hour laws.

> "Great! You'll need to bring your own laptop and smart phone. Will that be a > problem for you?"

Many states forbid companies from requiring that their employees bear the costs of business expenses. I wonder if employees at this company are being reimbursed.

> "Okay, our Customer Experience Associates normally begin work at 8 a.m. and > wrap up the day around 8 p.m. They work five days per week, plus one > rotating weekend shift. Is that okay?" She looked at me warily.

It would be interesting to know if the company is treating "Customer Experience Associates" as exempt or non-exempt employees. Customer service roles are almost always non-exempt, and non-exempt employees are entitled to overtime pay. Given that the author wrote she was offered a $35,000 salary and made no mention of overtime pay, it sounds like there might be a misclassification issue here. These misclassifications can be very, very costly (unpaid overtime plus interest, numerous statutory penalties, attorney's fees, etc.) so they're incredibly attractive to plaintiff's attorneys.

> "Service provider" was a pleasant euphemism for Handybook's fleet of > freelance cleaners and handymen. After signing up with Handybook, service > providers received text alerts about available jobs, which they could claim > for themselves by texting back, on a first-come, first-serve basis.

> A programmer giggled and called out, "Ashley, do your Chinese washer woman > impression again!" "My Chinese washa wo-men?" she pulled back the skin on > the sides of her face. "I do you laund-wy! Own-wy ten dollah!" She laughed > hysterically, "I clean you house!" The programmers sniggered loudly. "Ching > chong!" someone yelled out and collapsed into laughter.

> "Want to hear a joke I heard today?" a programmer asked, eying me and > giggling. "What's the difference between a woman and a refrigerator?" > "…what," I said. "Refrigerators don't moan when you put meat in them!"

This behavior is toxic to businesses that want to remain in business.

> "Service provider" was a pleasant euphemism for Handybook's fleet of > freelance cleaners and handymen. After signing up with Handybook, service > providers received text alerts about available jobs, which they could claim > for themselves by texting back, on a first-come, first-serve basis.

A lot of these "on demand" companies are built on classifying their service providers as independent contractors. In many cases, however, independent contractor classification is questionable. In this case specifically, the description of how the company dealt with Lupe raises serious questions.

The more funding these companies receive, and the bigger they get, the more attractive they're going to be to plaintiff's counsel. One of Handy's competitors is already on the radar of a prominent Boston class action attorney[1].

[1] [http://www.washingtonpost.com/news/storyline/wp/2014/09/10/a...](http://www.washingtonpost.com/news/storyline/wp/2014/09/10/at- the-uber-for-home-cleaning-workers-pay-a-price-for-convenience/)

<comment><USER23> _In this case specifically, the description of how the company dealt with Lupe raises serious questions._

Honest question: what is legally wrong with it? If people show up late, you are allowed to remove them from your network. I don't see anything at [http://www.irs.gov/Businesses/Small-Businesses-&-Self- Employ...](http://www.irs.gov/Businesses/Small-Businesses-&-Self- Employed/Independent-Contractor-Defined) that indicates paying attention to the time when work is done disqualifies one from being a contractor.

<comment><USER54> Right on the page you cited, it says:

 _" You are not an independent contractor if you perform services that can be controlled by an employer (what will be done and how it will be done)."_

Enforcing specific working hours is definitely controlling how a job will be done.

</comment></comment></comment><comment><USER66> Sounds like the company is growing too quickly for them to implement things like Human Resources & a new hire training program.

BYO Technology? that should be an OPTION, not a requirement...especially at 35K.

</comment><comment><USER67> > "Okay, our Customer Experience Associates normally begin work at 8 a.m. and > wrap up the day around 8 p.m. They work five days per week, plus one > rotating weekend shift. Is that okay?" She looked at me warily.

12 * 5 = 60 hours per week. That's illegal in the EU.

[http://en.wikipedia.org/wiki/Working_Time_Directive](http://en.wikipedia.org/wiki/Working_Time_Directive)

[https://www.gov.uk/maximum-weekly-working-hours](https://www.gov.uk/maximum- weekly-working-hours)

</comment><comment><USER68> This is interesting: [http://www.youtube.com/watch?v=V36Nn9UpBxk](http://www.youtube.com/watch?v=V36Nn9UpBxk)

</comment><comment><USER69> And now I'm never going to use Handybook again.

</comment><comment><USER70> These tales are infuriating.

</comment><comment><USER23> As much as things sometimes sucked during my recent job hunt, holy cow, this is over-the-top awful. The worst of my experiences were exceeded within three paragraphs.

I did have to deal with one company that said they had trouble "finding senior people" when the whole office was a playground. But no one told me any sexist or racist jokes.

</comment><comment><USER71> Here's a video on Handy's hiring strategy: [https://www.33voices.com/authors/umang-dua/media/handys- hiri...](https://www.33voices.com/authors/umang-dua/media/handys-hiring- strategies)

</comment><comment><USER72> Sounds terrible but I have to point out that I don't like the way she described Ajay as an "Indian guy".

I don't know why it rubbed me the wrong way

<comment><USER73> Yeah,same here. Nobody says "american guy". So she definitely wanted to get that fact through.

<comment><USER74> She says the marketing team was filled with a bunch of "white guys". I don't see what the issue is.

<comment><USER73> Indeed :)

</comment></comment></comment></comment><comment><USER12> This is probably hard for most engineers to relate to, unless part of your role is doing support.

edit: when I say something is not insane or unexpected, I mean it in the context of a person looking for work in customer support. These are the things you run in to. So if you are shocked that they have to provide their own hardware, then you are shocked at the way support people are often actually treated. I'm not advocating for or supporting that.

The interview process and criteria for being hired have really high variance compared to engineering interviews.

The author of this piece made the classic, and often unavoidable mistake of being between a rock and a hard place and not vetting the company she interviewed at and ultimately worked for for a day.

Even if you're not an engineer/designer/data scientist (or one of the typically highly desired people for a startup), you should be working at places you love and believe in, when you're not, you end up having bad experiences and those bad experiences are amplified by the environment.

First, I didn't find Ajay's interview to be that weird, saying why you came up with the idea for your company and your qualifications should be expected, not interpreted as a way for the founder to diminish the potential future employee. If you don't believe in your leaders, and don't trust them, you are in a lot of trouble.

edit: I think that not having interviewed with the actual support team members is a huge red flag here as well, but owing to the author's somewhat desperate situation, they moved forward anyways.

12 hour days is insane, and wrong. Having to provide your own device is not really that insane for small teams. Obviously it's great if a company provides it, and probably larger companies should always provide a workstation, but this doesn't come across as totally abnormal. The constant "want to hear a joke" and racist/sexist tone at the company is also not acceptable, but clearly was supported by the people working there at the time, if the anecdote is taken at face value.

It's super easy to pay for a trial period, and as far as I'm aware, it's not even legal to have people work for free unless you are a nonprofit or government organization, so that's shady, even if only for one day. I've done two week trials that were fully paid, and it was a great way to get a feel for the company and vice versa.

Not having any onboarding, given that the trial was for a day isn't too surprising, but that is clearly a problem with a one day trial. They should have absolutely been given some lead-in material to help them get prepped before starting.

There appear to be a lot of growing pains at Handy, which isn't a surprise, but hopefully they can move fast and get their support/service wing to be as tight and focused as the rest of their team (assuming that is true).

<comment><USER3> > _" Having to provide your own device is not really that insane for small > teams."_

Not that unusual to garage or ramen-stage companies sure, but these are guys with an office in one of the hottest startup hubs of Manhattan with $45 million in funding.

It's also insane - trusting hardware of unknown provenance with your customer experience? Is it really that hard to buy a few iMacs (or cheapo Dell desktops if that's your speed) for your support reps to use? That way hardware that's critical to your support infrastructure isn't traveling on the subway every day, getting broken, stolen, or god-knows-what.

This is a Series B startup with $45m in funding so far, they should be _way_ past the point of being able to buy some company machines for people to work on.

<comment><USER75> How does a company like this get $45 million in funding? Is that really cash in the bank, or "on paper, committed under certain circumstances, with only $1 million actually in the bank as of today?"

I guess I just don't understand how a business like this could ever get funded to $45 million.

Where's the competitive advantage?

India sent a satellite to orbit mars for $74 million, these guys have people answering phones to book odd jobs for $45 million?

<comment><USER21> > India sent a satellite to orbit mars for $74 million, these guys have people > answering phones to book odd jobs for $45 million?

And the phones aren't even provided by the $45,000,000! Lunch is though, so maybe that's what the big bucks get you.

</comment></comment></comment></comment><comment><USER76> The unpaid day of work sounds illegal but is at least pathetically unprofessional for that type of position.

</comment><comment><USER77> FYI in cased you missed it - This is a story about the world of telemarketing, not startups.

<comment><USER78> Eh. It's very much about the differential treatment that different types of employees get in startup. I don't think it's uncommon for programmers to be far more spoiled within companies than say, sales

</comment></comment><comment><USER79> Handy.com seems like a really honest and humane company to work for. Just look at the co-founder's face, it exudes an all caring expression, the type you can only acquire by going to Harvard and working for McSomething consulting firm.

<comment><USER80> Hahaha :)

</comment></comment><comment><USER81> If I was the guy being interviewed, I would have punched that "Ajay" in the fucking neck halfway through the interview...but looks like the company is punching itself in the neck anyway. Good riddance.

</comment><comment><USER82> This will never make the front page, no matter how many upvotes it receives.

<comment><USER7> It's at the top of the front page.

<comment><USER83> It's a conspiracy then!

</comment></comment></comment><comment><USER84> This doesn't seem like it could have happened in real life. I can't believe someone, especially in tech, could justify working in such an atmosphere with those "benefits".

Yes, big companies may stifle creativity a little, but from what little I read, this startup doesn't seem to be so great..

<comment><USER85> It seems to be real. The company's response is at [http://valleywag.gawker.com/handys-nightmare-tryout- process-...](http://valleywag.gawker.com/handys-nightmare-tryout-process-is-a- startup-stereotype-1649016476/) and reads basically "yeah but that was a while ago, we're different now".

</comment></comment><comment><USER86> The biz: Going rate where I deliver in Joisey for cleaners is $60 (min) for 2 hours. Homeowner/patrons I deliver to are too smart and would never call Handy back for next time.. just arrange it when they leave and the tip is given.

Her story: : It's about revenge (or opportunity to gain satisfaction). Does not matter if 0 or 100% is true - impersonal bashing is just now so easy and like this post, can lead to tons of reaction and attention. At my other job a man gets coffee each morning (at a C-store on Rt 15) and text's the district manager with his version of how bad the store is that morning. Each day, every day. No Joke. "Out of lids" \- "Didn't say Good Morning" "bla bla bla" He does it because he can.. it's not revenge.. (we need a new word)

Her story v2.0 - It's about eyeballs. Making a post "pop" \- The billfold (says) is a site about money, earning, spending, etc.. Her post is like having watermelon for Thanksgiving dessert. Satisfaction from eyeballs and keystrokes for certain to a site that is a stretch for relevance.

Her story v3.0 - Just another (engaging) article about a not so good place to work, of which we should never be surprised when we hear stories like this again and again.

I re read her words more than three times and something does not smell quite right. Just my gut. Perfect quotes, predictable responses, outrageous behavior of 'strangers' (the brandy new co-workers)- even the AHs in my Gov't job know when to not talk, especially around new faces. New faces are always thought of as spies until proven otherwise. [like the old phrase "a first impression has to be disproven"]</comment>


I want your opinion: Gumroad doesn't accept Paypal - <AUTHOR> http://gumroad.com/guide/basics/getting-paid#paypal

<comment><AUTHOR> I recently started to use Gumroad and I loved it. It made everything easier, and I will keep using it to receive payments with credit card.

The problem is they don't accept Paypal and make me work twice to implement a solution to accept Paypal to my customers (I'd lose a lot of sales if I don't).

What's your opinion? Is this the right approach? They should care more about their users and accept Paypal to make their lives easier?

Thanks :)</comment>


Red Hat CEO At LinuxCon: I Have No Idea What's Next - <AUTHOR> http://techcrunch.com/2011/08/17/red-hat-ceo-at-linuxcon-i-have-no-idea-whats-next/

<comment><USER2> > Indeed, the Linux Foundation's Jim Zemlin has been saying "This is the year > of the Linux desktop" for the last four years!

I'm glad someone is keeping the faith

<comment><USER3> the worst that can happen is that it will turn to be "This is the year of the Linux tablet- or smartphone-top".

Personally i was satisfied with Linux desktop on 386 sx33 back in 1995 (Slackware/XFree86/olvwm) and no desktop/etc... since then has beaten the experience yet (my at work quad core Xeon 3.2 GHz with windows 7 seems to be agile enough to provide rich experience of still painting the animated wait cursor (which cursor has much visually improved since windows 3 - no questions here) when i click to close the empty (!) Excel instead of just immediately closing the damn thing)</comment></comment>


Evolution of Open Source at Netflix - <AUTHOR> http://techblog.netflix.com/2015/10/evolution-of-open-source-at-netflix.html <comment><USER2> I'm not entirely sure why they don't mention it here, but Netflix is also a major contributor to FreeBSD.

<comment><USER3> The projects they list seem to all be in-house projects that they own/control, not a list of third-party projects they use.

</comment></comment><comment><USER4> I read down to the [http://netflix.github.io/](http://netflix.github.io/) link, tried it, the carousel advanced to fast for my slow eyes I guess, I manually selected the radio button, started reading and ... the next slide came up before I finished. Then I got into a war with the carousel timer. Frustrating on that but the page looks nice once you hit the carousel radio buttons enough to read it.

<comment><USER5> Reminds me of this: [http://shouldiuseacarousel.com/](http://shouldiuseacarousel.com/)

</comment></comment><comment><USER6> So good to see companies that weren't 'OSS first' playing catchup and doing so effectively

</comment><comment><USER7> An unfortunate name clash with [https://github.com/openstack- infra/zuul](https://github.com/openstack-infra/zuul) really threw me there for a bit.

<comment> mh- the Netflix Zuul was open sourced before the openstack Zuul was created.

[https://github.com/Netflix/zuul/graphs/contributors](https://github.com/Netflix/zuul/graphs/contributors)

[https://github.com/openstack- infra/zuul/graphs/contributors](https://github.com/openstack- infra/zuul/graphs/contributors)</comment></comment>


Getting Friendly with Rails Fixtures - <AUTHOR> https://whatdoitest.com/getting-friendly-with-fixtures

<comment><USER2> We've found this to be the great spot in between. [https://github.com/rdy/fixture_builder](https://github.com/rdy/fixture_builder)

You use factories to build your fixtures and it regenerates if needed.

I used it in a sample app recently here: [https://github.com/taskrabbit/rails_engines_example/blob/mas...](https://github.com/taskrabbit/rails_engines_example/blob/master/spec/support/fixture_builder.rb)

<comment><AUTHOR> That's the best of both worlds. I'm going to give this a try.</comment></comment>


This Event is Cancelled - <AUTHOR> http://londonist.com/2010/08/this_event_is_cancelled_courtesy_of.php

<comment><USER2> That has half the intended effect: Convince people that their poster was pointless.

However, it doesn't discourage future posters much (they'd have to know the 'cancelled' sign was fake, and if everyone knows that, they 'cancelled' sign doesn't work any more) and it doesn't do anything to clean the poster off.

Since the intent is to keep the place clean and beautiful, leaving the poster violates that. It still has to be removed, and it's still just as hard to remove it.

<comment><USER3> Flyposting in London is an organised, professional business. There are a few people doing it themselves, but the major campaigns are organised by large agencies on behalf of club promoters. The clubs design posters with the small print "not for flyposting", the agencies distribute them through freelancers who aren't told specifically what to do with the posters other than to get them seen. The only person who can be held liable is the guy on the street with the paste brush. The council can't go after the people paying for and profiting from flyposting, and they can't afford to remove enough posters to make it unprofitable.

The club promoters are well aware of what's going on and it's a significant disincentive for them to pay for flyposting if there's a chance that it will do their event more harm than good. The council aren't trying to completely stamp out flyposting, they're just trying to make it less attractive than flyering or advertising on pirate radio. It's a rather clever economic nudge, designed simply to increase the CPA of flyposting.

</comment></comment><comment><USER4> Why is this being posted on HN? Flagged.

<comment><USER5> From the guidelines: "Please don't submit comments complaining that a submission is inappropriate for the site. If you think something is spam or offtopic, flag it by going to its page and clicking on the "flag" link. (Not all users will see this; there is a karma threshold.) If you flag something, please don't also comment that you did."

<comment><USER4> Hmm, depends on your interpretation, I always deem flagging a submission worthy of _asking_ why it was posted even though I disagree with it's content being worthy of HN. I don't consider that to be complaining, it's a valid question.

I generally like to admit that I flagged the post for discretionary purposes during a conversation in the comments, but since you're being pedantic and four other users agree, it doesn't do me any harm to leave that bit out when I ask why an article is being posted on HN.

<comment><USER6> I can't imagine any other way to interpret "If you flag something, please don't also comment that you did."

Please enlighten me?

<comment><USER4> No enlightening needed, I already explained that "Please don't submit comments complaining that a submission is inappropriate for the site." was up for interpretation (I wasn't complaining in my comment, I was asking a question); and also admitted that "it doesn't do me any harm to leave that bit out" (in reference to stating that I flagged something).</comment></comment></comment></comment></comment>


How to get into microservices real quick - <AUTHOR> https://blog.ruxit.com/microservices/ <comment><USER2> You can also get a nice set of microservices resources, just searching HN, ranked by points generated, so with good social proof they are good:

[https://hn.algolia.com/?query=microservices&sort=byPopularit...](https://hn.algolia.com/?query=microservices&sort=byPopularity&prefix&page=0&dateRange=all&type=story)

<comment><AUTHOR> This is awesome, thanks.

</comment></comment><comment><AUTHOR> I did some extensive research and blogging on the topic myself. As the internet has been a great source of information for me, I'd like to give back to the community and offer a list of my resources here.</comment>


Open Source Enterprise Server OS - <AUTHOR> https://omniosce.org/ <comment><USER2> It's the successor of OmniOS by OmniTI which is based on OpenSolaris [1]. Tobi Oetiker (of RRDTool) and other have adopted the project. See the "About" page which is unfortunately hidden in the Site menu: [https://omniosce.org/about/about.html](https://omniosce.org/about/about.html)

</comment><comment><USER3> This reminds me about SmartOS[1].

[1]: [https://www.joyent.com/smartos](https://www.joyent.com/smartos)

<comment><USER4> The SmartOS and OmniOS folks work together from time to time. For example, I believe Bhyve was first ported from FreeBSD to OmniOS before it eventually came to SmartOS.

<comment><USER5> Other way round. Like LX, into SmartOS first, then brought across into OmniOSce. But yes, OmniOSce picks up a lot of SmartOS features, whereas some of the other distros are vanilla illumos.

[https://omniosce.org/info/bhyve](https://omniosce.org/info/bhyve)

</comment></comment></comment><comment><USER6> Since it's hidden at the bottom:

> illumos based server OS with ZFS, DTrace, Crossbow, SMF, Bhyve, KVM and > Linux zone support.

</comment><comment><USER7> Enterprise server OS doesn't need name like that. The most popular derrives from Deborah and Ian</comment>


Ask HN: What password manager do you use and why? - <AUTHOR> After reading the discussion around password managers in the recent Bitwarden thread on HN, I decided to switch to password manager instead of dealing with the buult-in browser password manager.
But the available password managers are overwhelming. LassPass, Dashlane, 1Password.
Which one do you use? <comment><USER2> [https://www.passwordstore.org/](https://www.passwordstore.org/) \- Its open source and free. I control where my encrypted passwords are backed up. It has integrations will all major platforms

</comment><comment><USER3> I use 1Password, which is free from my work. Otherwise, I'd use Bitwarden.</comment>