idea that encompasses one without the other is just not the same and if
neither is present there is little, if any, chance of success for
entrepreneurs looking to build the next great company in the
In the day and age of Uber and Lyft, we often hear “we are the Uber of XYZ…”.
But what does it mean to successfully identify the next “Uber of XYZ”.
Before we touch that topic, let us test the concept of frequency and
density for ridesharing.
What if only a few dozen people a day needed a ride from Point A to
Point B instead of the thousands or tens of thousands that utilize
ridesharing apps everyday to get from one place in a city to another.
Would there be enough demand for crowd-sourced drivers to make
meaningful extra income and provide the capacity availability necessary
to attract passengers? The most likely answer is no. Without enough
frequency of use, it is often times difficult to recruit the “crowd”
supply dynamic that needs to be in place to service the demand when
What if there were a thousand potential passengers per day but their
pickup and drop-off points were all across the state of California. How
would you insure that there was a driver available in the area of the
passenger within a reasonable time period? How would you insure that a
driver would be willing to take that fare? Without density of demand (as
an example — all thousand passengers located in one city and travelling
within the city), it would be difficult to build up a fleet of
crowd-sourced on-demand drivers that would permit constant capacity
availability for all pickup and drop-off points.
for ridesharing, market dynamics work in its favor, there is ample
demand for passengers needing to get from one place to the next on any
given day within each metropolitan area.
lets get back to the “Uber of XYZ” or frankly any concept that is
dependent on a local community of providers and users. We can use the
simple test of frequency and density that we just discussed to help
determine the viability of the idea. Is there enough frequency of use?
Is the usage in a concentrated geographic area? Is there and can there
be adequate number of providers in the usage areas? If the answers are
yes, you can likely move on to the next step and ask yourself “what will it take to build this business?”.