TIME Transportation

Looking for a Ride? Here’s a List of Uber Alternatives

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A Lyft car operates in San Francisco. courtesy of Lyft

A lot of companies want to be your driver

Uber has lost some users this week following stories about executives proposing opposition research on critical journalists’ personal lives and tracking a journalist’s use of the service without her permission. Some customers publicly ended their relationship with the company via social media, including humorist-actor-author John Hodgman. “I really don’t want to take that crummy car I was so glad to hang up on two years ago,” he wrote in a post about his decision to delete the app. “But I just can’t get into a car with those guys anymore.”

If you live in certain parts of the world, you might not even have Uber available as an option to walk away from. And you may have no intention of quitting Uber at all, continuing to love the service that is leading the revolution of local transportation around the world, providing an on-demand alternative to calling up a old-fashioned taxi cab dispatcher.

But for those out there into trying new things, here are some of the other players on the road offering smartphone-enabled rides from A to B:

Lyft: The San-Francisco based ridesharing company is the friendly neighbor to Uber’s cool chauffeur. Drivers use their personal cars, grilles adorned with signature pink mustaches, and invite users to sit in the front seat, often offering a fist bump as a greeting. The company has rolled out three additional services, Lyft Plus (fancy SUV version), Lyft Line (carpooling version) and Lyft for Work (commuting version). Lyft operates in about 60 U.S. cities, compared to Uber’s 220 worldwide. In some cities, like New York, Lyft functions very similarly to Uber.

Sidecar: This ridesharing company, also based in the Bay Area, promises the “lowest prices on the road.” Available in 10 major U.S. cities, Sidecar aims to match riders with “everyday people” driving their personal cars. But unlike other services that rack up a fare as you go, Sidecar asks riders to enter their destination and offers a selection of pre-set prices, along with ETAs, which the rider can choose from. The company also offers a cheaper “Shared Rides” carpooling option like Lyft Line and Uber Pool.

Flywheel: Taxi companies are using apps like Flywheel to re-disrupt the disruptors. Currently in San Francisco, L.A. and Seattle, Flywheel allows users to order a taxi on-demand and have payments made automatically through the app. The ride likely won’t be as fancy as an Uber black car or as cheap as an UberX, but there’s no surge pricing and the company is brokering deals to allow scheduled rides to airports, places where ridesharing companies are typically non grata.

Curb: In August, Taxi Magic launched as the rebranded Curb, broadening their focus beyond providing licensed taxis on-demand to include fancier cars-for-hire (like Uber black cars) in some of the 60 markets where Taxi Magic was already working with fleets. Unlike most of the other app-based services, customers have the option of paying with cash rather than through the app. The refreshed company is also working on launching pre-scheduled rides, to the airport and beyond.

Hailo: Another e-hail company that works with licensed cabs, Hailo is focused on the European market, having launched in London in 2011. (betrayed by their slogan, “the black cab app.”) In October, the company announced it would be closing operations in U.S. cities like New York, Chicago and Boston, shifting their eye to growth in Asia and, perhaps, re-entering the U.S. market in a few years. In September, the company launched an innovative feature that allows users to pay for the bill in a street-hailed taxi through the app.

Summon: The rebranded and overhauled InstaCab, Summon is an on-demand service that has a hybrid approach, offering both taxi e-hails and cheaper peer-to-peer “personal rides” with a no-surge-price promise. Summon is currently available only in the Bay Area, but the company said earlier this year they plan to expand to L.A., Boston and New York. The startup offers pre-scheduled rides through their Summon Ahead program, including fixed-rate rides to surrounding airports, with a journey to San Francisco’s SFO costing a mere $35.

RubyRide: Based in Phoenix, Ariz., and founded in 2013, RubyRide is a fledgling subscription-based startup that bills itself less as a taxi replacement and more as a replacement for owning a car. A basic plan that allows unlimited pre-scheduled pickups and drop-offs within certain “zones” like Downtown Phoenix costs $299 per month. The company offers limited on-demand service but plans to expand their options—including replacing rides to and from the dry cleaners, say, with delivering members’ dry cleaning—as they grow.

Shuddle: Dubbed “Uber for kids,” this San Francisco startup positions itself as an app for lightening Mom’s load. Parents can pre-book rides to take kids (who aren’t old enough to drive themselves) to sports practice or school. With safety the obvious concern, the company institutes layers of checks beyond thoroughly screening employees: drivers are given passwords they have to use before picking up kids; parents are given photos of the drivers and cars and can monitor the trip through their app. Drivers must have their own kids or have worked with kids. The company’s first 100 drivers, which they call “caregivers,” are all female.

MONEY Workplace

Why Coworking Is Hot

shared workspace
Hero Images—Getty Images

These shared workspaces for freelancers, entrepreneurs, and other independent workers tend to feel hip, fun, and casual -- but their success is about much more than cool design.

Coworking spaces – where freelancers, entrepreneurs, and other independent workers pay a fee to share a workspace and benefit from working in the presence of one another – are hot. More than 160,000 people worldwide are members of over 3,000 coworking spaces, according to a recent report by DeskMag.com and Emergent Research, up from just 20,000 workers in 500 spaces in 2010.

My colleagues Gretchen Spreitzer and Lyndon Garrett and I set out to understand what draws people to coworking and what accounts for its success. We surveyed members from over 40 coworking spaces around the United States, analyzed the websites of over 100 U.S. coworking spaces, visited a handful of spaces in major U.S. cities, and spent several months as participant observers in one local coworking community in Ann Arbor, Michigan.

Given the coolness factor of coworking spaces – especially those that attract members with hip design and high levels of service – we figured that their design had something to do with the success of the phenomenon. But we wondered what other factors drove the success of the coworking model. Several interesting insights emerged.

Coworking fosters personal growth and community building

In his recent book, The Purpose Economy, social entrepreneur Aaron Hurst writes how coworking spaces are a powerful tool for cultivating community among a new class of workers who are driven to organize their professional lives around continuous personal growth, meaningful relationships, and the service of something greater than themselves.

One of the aims of the coworking movement is to provide people with a safe space where they can be themselves at work. But it also encourages members to explore shared interests with one another and collaborative opportunities that go beyond daily work routines. Grind, for example, a New York-based coworking space that participated in our study, offers tips to its members on how to move beyond their natural comfort zone and meet fellow members.

We also found learning to be a necessary component of what makes coworking a successful model. Member education is an explicit part of the mission of many coworking spaces. We saw spaces supporting member education, member support networks, and access to professional development opportunities and mentorship. Many spaces also host social events like happy hours, networking events, and guest lectures in order to reinforce learning and community building.

The most successful build “just right” communities

That is, just right in that they involve newcomers as much or as little as they want, without any pressure.

Unlike a traditional shared rental office where people largely want a quiet professional space to work without being bothered by others, many coworking spaces curate an experience that allows potential members to try the space and meet other members to see if there is a fit.

But unlike a traditional work organization that does this through the hiring process, coworking has low switching costs for members and doesn’t actually commit them to any aspect of the work experience that is meaningless to them. The result is that coworking gives a non-overbearing sense of belonging to those who want to be part of the community.

Coworking isn’t just for start-ups and freelancers

Although the earliest coworking communities were organized to provide an alternative to coffee shops or working at home to freelancers and entrepreneurs, we learned that coworking spaces are reaching diverse segments of the workforce. We found some spaces catering to writers and artists by emphasizing affordability and an atmosphere of creativity, for example. Others, including some of the most welcoming communities in our sample, attract women entrepreneurs.

But coworking also helps people keep good jobs with conventional employers in cases when, for example, they are forced to move for a spouse’s job change. In fact, 21% of U.S. sites explicitly market to remote workers, and one-third of our survey respondents were employed full-time by some other company. On average, these individuals are spending 65% of their time working from a coworking space.

“We have seen individuals who come in to avoid the commute to their traditional office space,” says Michael Kenny, managing partner of San Diego-based Co-Merge, a space that participated in our study. At Co-Merge, users from Accenture, Groupon, and Citrix are using the space on a regular basis. Co-Merge also has members who remotely work full-time for companies in other major cities such as Baltimore, Chicago, and Washington.

It’s the authentic sense of community where intrinsically motivated people who experience a sense of purpose in their work and thrive together that substantiates the coworking movement. Given these qualities, we expect to see a growing number of flexible workers try coworking — and a growing number of employers embracing coworking as a tool to help their increasingly mobile and flexible workforce to do their best work.

Peter A. Bacevice (@Bacevice) is a researcher with the Center for Positive Organizations (@PositiveOrg) at the University of Michigan’s Ross School of Business (@MichiganRoss) and senior design strategist with the New York office of HLW International (@HLWIntl). Gretchen Spreitzer is the Keith E. and Valerie J. Alessi Professor of Business Administration and Professor of Management and Organizations at the University of Michigan’s Ross School of Business. Lyndon Garrett is a doctoral candidate at the University of Michigan Ross School of Business.

 

TIME Companies

7 Dead-Serious Uber Controversies That Somehow Didn’t Sink the Company

Uber Taxi App In Madrid
Pablo Blazquez Dominguez—Getty Images

From high-speed chases to abductions to driver poaching, Uber is well-acquainted with the snafu

Uber is no stranger to confrontation. The ride-sharing firm is known for aggressive tactics that have helped fuel its explosive growth. Its very business model is based on disrupting old-school taxi services in cities across the globe.

Remarks made by Uber’s senior vice president for business, Emil Michael, have put the spotlight on the company once more. A Buzzfeed editor overheard Michael outlining “the notion of spending ‘a million dollars’ to hire four top opposition researchers and four journalists. That team could, he said, help Uber fight back against the press—they’d look into ‘your personal lives, your families,’ and give the media a taste of its own medicine.”

Michael excused himself later, saying that he regretted his idea to investigate and embarrass critical journalists, and that his remarks “do not reflect my actual views.”

Here are seven other controversies that the company has been embroiled in over the years. None of them has seemed to really hurt it permanently. Uber will hit an annual revenue rate of $10 billion by the end of 2015, Business Insider reports.

Sabotaging Lyft by booking rides and then canceling them

Uber employees allegedly posed as customers ordered and then canceled rides from Lyft, decreasing Lyft drivers’ availability, wasting time and gas, and possibly sending real customers to Uber instead. Lyft told CNNMoney in August that 177 Uber employees—contractors armed with a burner phone and a credit card—ordered and canceled more than 5,000 rides.

Uber officially denies that it’s playing dirty, but an Uber contractor told The Verge that the company encourages that kind of maneuver.

Poaching Lyft drivers

Uber employees are known to hail Lyft rides, converse with Lyft drivers, and try to recruit them to Uber before they get to their destination. The system has become complex: there’s an official conversation guide for Uber recruiters, and a messaging app that tells Uber recruiters which Lyft drivers had already been pitched. One source told the Verge that recruiters can earn a $750 commission for successfully recruiting a single new driver to Uber.

(Lyft has also sought to recruit Uber drivers, by offering cash bonuses for joining.)

Disrupting established taxi services

Traditional city taxi services aren’t happy with the competitive challenge Uber poses. Sentimentalists mourn the hardships faced by old-line companies like the classic New York City yellow cabs, and many argue that Uber should be subject to the same regulations as traditional taxi services. Uber has faced a slew of legal challenges, lobbying and public mud throwing in dozens of cities it has moved in to.

One Uber driver allegedly abducted a woman

An Uber driver was arrested in June by Los Angeles police on suspicion of kidnapping a drunk woman and taking her to a hotel, intending to sexual assault her. The LA Times reports that a valet employee at a night club asked an Uber to drive a young woman home, but he instead allegedly drove her to a hotel and slept beside her.

..a second driver apparently abducted another woman

Another LA woman was reportedly abducted by an Uber driver last month who took her almost 20 miles out of the way, ignoring her questions and directions, and drove her into a dark empty parking lot in the middle of the night. The driver locked the doors, trapped her inside and only took her home when she screamed and caused a commotion, Valleywag reports. A quick ride turned into a two-hour plus nightmare.

…a third is said to have abducted a New York-based CEO

The CEO of a New York-based company said he was taken on a wild ride by an Uber driver in July who appeared to be escaping D.C. taxi inspectors.

The Uber driver started down the street, ran a red light and veered away from the D.C. inspector, according to CEO Ryan Simonetti’s story in The Washington Post. Simonetti says he was driven down the highway well above the speed limit as the Uber driver veered, narrowly missing hitting other cars in order to escape the D.C. authorities. “It was insane,” Simonetti said. “I physically tried to force his leg to hit the brake. I ripped off his pant leg…. I said, ‘Here’s two options. You take this exit, or I’m going to knock the side of your head in. If we crash, we crash, but you’re gonna kill us anyway.’” Simonetti managed to escape the car, and the Uber driver screeched away the wrong way up an exit ramp.

…and a fourth was arrested for supposedly hitting a passenger on the head with a hammer.

In September, an Uber passenger in San Francisco questioned a driver on the route he was taking when things turned ugly, NBC reported. Driver Patrick Karajah pulled the vehicle over and took a hammer, beating the passenger over the head and causing facial fracture and trauma to the head. Karajah is being charged with deadly weapon assault and battery with serious bodily injury; the passenger, Roberto Chicas, faces reconstructive surgery and hasn’t been able to work since the assault.

One of the major complaints against the company is that it doesn’t vet its drivers the way that an established taxi company does. (That applies to Lyft, too.) Uber does do a driver background check, but established taxi drivers are often better regulated.

TIME Innovation

Five Best Ideas of the Day: October 24

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

1. Iran’s insidious control of Hezbollah and Russia’s operations inside Ukraine call for a new U.S. strategy to counter unconventional warfare.

By Robert A. Newson in Defense One

2. Criminalizing organ donor compensation endangers lives and fuels an unregulated black market.

By Sigrid Fry-Revere and David Donadio in the New Republic

3. Utility rights-of-way — think power lines and pipelines — can become flourishing wildlife habitats.

By Richard Conniff in Yale Environment 360

4. A unique combination of government support and a strong entrepreneur culture has made D.C. a hub for startups.

By Dena Levitz in 1776 DC

5. For the nations of the South Caucasus, the fate of Ukraine means choosing between Russia and the west comes at a high price.

By Maxim Suchkov in Carnegie Moscow Center Eurasia Outlook

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

TIME Ideas hosts the world's leading voices, providing commentary and expertise on the most compelling events in news, society, and culture. We welcome outside contributions. To submit a piece, email ideas@time.com.

TIME Companies

Ad-Free Social Network Ello Gets $5.5 Million in Funding

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The Ello website is seen on the monitor screen September 27, 2014 in Washington D.C. Paul J. Richards—AFP/Getty Images

Company promises it will never sell ads or user data

The burgeoning social network Ello has raised $5.5 million in a new round of venture funding, it was revealed Thursday. The buzzy startup gained widespread attention in September thanks to its manifesto decrying social media companies’ habit of gathering and monetizing user data.

“Advertisers buy your data so they can show you more ads. You are the product that’s bought and sold.” the manifesto reads. “We believe a social network can be a tool for empowerment. Not a tool to deceive, coerce and manipulate — but a place to connect, create and celebrate life.”

Ello is putting some legal muscle behind its lofty rhetoric by reincorporating as a public benefit corporation in Delaware. The company will vow in its new legal charter that it will never sell user data or advertising, according to The New York Times. The company plans to make money by charging users for extra, as-yet-unspecified features.

Though Ello has been around since summer, the site exploded in popularity last month after Facebook began kicking drag queens off its site because they were not using their legal names, leading some of those users to relocate to Ello. The small social network leapt from 90 users in early August to more than 1 million today, according to the Times. Facebook has since apologized for how its real name policy affected the LGBT community and others.

The funding round was led by Foundry Group, based in Boulder, Colo.

[Re/code]

 

TIME Companies

Google Inks $542 Million Venture Deal to Fund Mysterious Startup

2013 Google Developer Conference Continues In San Francisco
An attendee tries Google Glass during the Google I/O developer conference on May 17, 2013 in San Francisco, California. Justin Sullivan—Getty Images

The four-year-old firm Magic Leap aspires to blend computer generated images into the physical world

Google and several other leading tech firms have pooled $542 million in venture capital funding for Magic Leap, a secretive, Florida-based startup that is rumored to be working on virtual reality eyewear.

The deal, one of the largest venture capital fundraisers to date, would value the company at nearly $2 billion, two sources close to the negotiations told the Wall Street Journal. Two senior Google executives will join Magic Leap’s board of directors.

Little is known about Magic Leap beyond an eye-popping video of what the company hopes to achieve with its technology: a projection of life-like imagery that seamlessly blends with the physical surroundings. This deal echoes Facebook’s acquisition of Oculus Rift, a virtual reality headset that immerses users in graphically rendered 3-D worlds.

Both technologies point to a gamble within the tech industry that interfaces will ultimately break free from the confines of 2-D screens and form more immersive user experiences.

[WSJ]

TIME Startups

5 Reasons You Want to Become a ‘Growth Hacker’

Startup
Hero Images—Getty Images/Hero Images

Short answer: dramatic impact on business growth

startupcollective

This story was originally published on StartupCollective.

I’m elbow to elbow with everyone in a room packed with around 180 people, and all I can hear is the dizzying murmur of words like “SEM” and “User Acquisition Costs.” One person I meet is an engineer at a company that is changing the mattress industry by selling directly online to the consumer. Another person is a communications professional from England who recently moved to New York City to find opportunities as a marketer for startups.

We’re all here, at a GrowHack meetup in New York City hosted by Conrad Wadowski, to hear Sean Ellis speak about growth hacking. Despite our diverse backgrounds, we all want to learn about the little things we can do that can have a dramatic impact on business growth. Sean was the first marketer at Dropbox, Lookout, Xobni, and led marketing teams at companies like LogMeIn and Uproar through IPO filings. He now runs a successful data insights startup called Qualaroo, and is credited with coining the term “growth hacker” in his post, Find a Growth Hacker for your Startup.

Sean revealed unique insights about growth strategies and reassurance to all those working hard every day to grow their business.

First, Hustle to Get Traction

There was natural curiosity about how Dropbox became what it is today. Sean revealed that in the beginning, it was all about hustling. Drew Houston first created a video with some clever tongue-in-cheek humor that caught on with the tech crowd. They also gamed Digg and Reddit to get more exposure. In fact, their efforts landed them on the front page of Digg, which in its heyday, could drive meaningful traffic to a site.

Such hustle is not uncommon among startup stories. Whitney Wolfe, co-founder of Tinder, visited sororities to get girls on Tinder. Shortly after, she went to their neighboring fraternities, which then gladly joined. The founders of Flickr commented on photos regularly in order to create an engaged community.

Our first product, EasyBib, now has 40 million yearly users. We started without any in 2001. We invaded AOL chatrooms to talk about our product, spammed thousands of teachers individually, and sent emails to dozens of publications. We ended up being published on the front page of the business section of the Chicago Tribune.

Optimize Your Product for Marketing

Sean talked about how Dropbox had a strong focus on making their product do the marketing for them. In particular, they introduced the concept of a dual reward: When you invite someone to access your Dropbox, they receive 250MB of free space, and so do you. Therefore, the more people used Dropbox, the more beneficial it was.

But the Dropbox team made their product even stickier. When someone you shared a Dropbox folder with created an account, you would be pleasantly notified that you have more memory. If you’re familiar with Nir Eyal’s hook methodology, such variable rewards keep you highly engaged in a product. Seeing the success of the referral program, the Dropbox team doubled down on the idea by strategically placing prompts to share throughout the product, testing what would make it more shareable.

Do Whatever It Takes to Learn About Your Users

Sean advocated that every marketer should be surveying their audience. At his past companies, he didn’t think on his own how to position the product. Instead, he would ask users how they would describe it to a friend, and what one word they would use to describe the product. Having gained this insight, he would then test and iterate on messaging.

Surveying goes beyond the purpose of understanding messaging. Sean would look at a user funnel and identify where drop-offs existed. He would then reach out to those who dropped off at a particular point to understand why. He cited an example where LogMeIn users from a new channel were dropping off on a free offer. It turns out they they thought the offer was too good to be true. As result, Sean’s team created an option to download a trial of the premium version or download the free version, which increased conversion by the tune of 300 percent.

More importantly, Sean would survey to benchmark whether users found value in the product, and why or why not. He would utilize that information to better demonstrate the product’s value, and survey again to gauge if his changes were improving upon the initial benchmark.

In my experience, talking to the customer is invaluable. When we show someone our new GetCourse product, we ask how they would describe the product, and why they would recommend it to a friend. These questions have helped us understand how we should position the product. To learn more about surveying, ConversionXL has a great post on the best questions to ask.

Think Beyond Content

Sean created a community website to drive conversation around the plethora of great marketing content circulating the Internet. His ultimate goal was to educate readers of GrowthHackers about his Qualaroo product. What’s fascinating is that Sean realized that in order to make Qualaroo stand out, he would have to go beyond pumping out content like all his peers in the space. He could distinguish his efforts through curation and technology.

GrowthHackers exceeded expectations. Not only did it provide exposure to Qualaroo as intended, but the community that rallied around it became so strong that GrowthHackers has the potential of becoming it’s own business. Sean now hosts conferences with the Growth Hackers brand.

Indeed, the future of content marketing is thinking beyond content. Above all else, Sean constantly reminded the audience of the importance of testing your ideas, which is a core tenant of growth hacking. His lessons aren’t textbook, they’re tested.

Neal Taparia is Co-CEO of Imagine Easy Solutions. This post originally appeared on the author’s Forbes column.

TIME Startups

Reddit Gets $50 Million in Venture Funding

A big step for a major Internet hub

The popular online message board Reddit has secured $50 million in new venture capital funding, the company announced Tuesday. The website known as the “front page of the Internet” is getting a cash infusion from a long list of investors that includes Y Combinator president Sam Altman, Marc Andreessen of Andreessen Horowitz and the rapper Snoop Dogg.

Reddit is well-known for its primitive website design and laissez-faire attitude toward moderating its users. The company is a former subsidiary of Conde Nast that was later spun off into an independent company. CEO Yishan Wong said the new funding will help Reddit grow its relatively small staff of 60 and improve its app and ad products. “An investment like this doesn’t mean we’re rich or successful,” Wong said in a blog post. “Money can become worthless very quickly, value is something that is built over time through hard work.”

Reddit faced criticism earlier this month for allowing users to link to a vast number of stolen nude photos of celebrities. The startup defended the right of its users to post controversial content but ended up banning the page with the nude photos because some of the images were of minors.

With more money may come more pressure for Reddit to both generate profits and conform to the standards of traditional media companies. For now, though, Reddit is still playing by its own rules. The startup, which acknowledged it was still unprofitable earlier this year, has agreed to give 10% of its 2014 ad revenue to charity. The company promised Tuesday that investors involved in the latest funding round will give 10% of their shares back to the Reddit community (details on the practicality and legality of this are still to come, Wong said).

Reddit is no longer a scrappy startup underdog. It’s a company with a valuation pegged as high as a half-a-billion dollars that has hosted a conversation with the President, among other leaders. But Wong remains confident that backers will let the newly-rich Reddit keep being weird.

“We have been entrusted with capital by patient, long-term investors who support our views on difficult issues,” he said. “We believe in free speech, self-governing communities, and the power of voting. We find that this freedom yields more good than bad, and we have chosen investors based on this belief.”

TIME Startups

San Francisco and Los Angeles Threaten Crackdown on Uber, Lyft

App Car Service Startups Continue To Irk Traditional Cab Companies And Regulators
A Lyft car drives along Powell Street in San Francisco on June 12, 2014 Justin Sullivan—Getty Images

Prosecutors in California's two biggest cities say the ride-share programs are breaking the law

Correction appended, Sept. 26

Uber, Lyft and Sidecar are under scrutiny by San Francisco and Los Angeles district attorneys, who are threatening legal action against the ride-share companies unless they make major structural changes.

The San Francisco and Los Angeles offices said that a joint investigation found the ride-share companies were in violation of California law and represent “a continuing threat to consumers and the public,” SF Gate reports. They’re threatening to levy civil penalties on the on the companies, but didn’t say what those might be.

The district attorney offices said that the three companies mislead customers by saying their background checks on drivers screen out those with criminal offenses and DUIs — but that in actuality, they don’t. They also said that the shared-ride-service fares that allow separate passengers going the same way to pay their fares separately violate state law.

“We value innovation and new modes of providing service to the public,” San Francisco district attorney George Gascón said in a statement. “However, we need to make sure the safety and well-being of consumers are adequately protected in the process.”

The attorneys also said Uber and Lyft have to be regulated by the California Department of Food and Agriculture’s weights and measures division, which would ensure riders are getting the taxi miles they pay for, and that the two companies don’t have the correct licenses to pick up and drop off passengers at airports.

[SF Gate]

Correction: The original version of this story misstated in the headline the nature of prosecutors’ threat to Uber and Lyft. They threatened civil penalties.

TIME

This Startup Thinks Pictures of Onions Can Reveal Changes in the Economy

Fruit and vegetables are common items photographed with the Premise app to help measure inflation

Correction appended, August 25

It’s probably every teenager’s dream to get paid for snapping iPhone pictures. Instead of selfies, though, David Soloff is seeking pictures of fruit carts, health clinics and remotely located schools. His startup is hoping to leverage the vast proliferation of smartphones—and our insatiable desire to take photos with them—in order to bring real-time economic data to the masses.

The new company, called Premise, tracks economic indicators by enlisting armies of local residents to record data about their communities, like the price of oranges at a local market or the physical condition of a local health clinic, via an Android app. Premise pays the photo-takers up to 15 cents for each “observation,” which can be a picture or other data point. The company aggregates all the individual observations to derive broader insights about inflation and consumption shifts in different countries, then sells the data to financial institutions.

Premise’s aim is to provide important economic metrics faster than government agencies, which often only release data in weekly or monthly intervals. The company is currently gathering data in 50 cities across four continents, including locations in Argentina, China and the United States.

“What people experience in their day-to-day lives is frequently really, really different from what the official government or news bureau or stats-gathering agencies tell them about their lives,” says Soloff, Premise’s CEO. “By the time those official numbers come out, the world’s probably changed a lot.”

Soloff points to countries like Argentina — where Premise and a variety of economists have projected inflation to be increasing much faster than the government says it is — as an example of a place where private data sources can be more reliable than official figures. In other countries, such as India, where onion prices leapt 190% in 2013, food prices are incredibly volatile and government-released figures can’t keep up with the rapid changes.

“Almost certainly, in a lot of countries, the government is lying about price changes,” says Gary Burtless, an economist at the Brookings Institution. “It would be useful to know, to ordinary people and to businesses, what the real inflation is.”

How does Premise ensure that its figures are accurate? To devise its economic models, the company has brought on advisors whom Soloff calls the “adult supervision.” Among them are Hal Varian, Google’s chief economist and Alan Krueger, the former chairman of President Obama’s Council of Economic Advisers. To guarantee that data are collected accurately on the ground, Premise vets local residents by giving them test assignments, then evaluating their performance before committing their observations to the official dataset. The company recruits new workers via social media, online job boards and college campuses.

“It’s not an open cast call,” Soloff says. “These are students or people on the way to jobs or people who are doing the weekly shopping for their families at the market.”

0_Task lists
The Premise app assigns users tasks to complete in order to feed the company’s massive data set.

So far, Bloomberg and Standard Charter Bank have signed on to receive Premise’s data, in addition to other financial institutions that Soloff declined to disclose. The company is currently unprofitable, but it has raised $16.5 million in venture funding from bigtime backers like Google Ventures and Andreessen Horowitz.

Soloff isn’t the most likely man to head a high-tech San Francisco data firm. He studied Near Eastern linguistics as an undergrad at Columbia University and has a master’s in history from the University of California, Berkeley. But Soloff believes his humanities background gives him an edge in Silicon Valley.

“I’ve always been interested in systems, how things work,” he says. “Language systems, social systems, financial markets have always fascinated me.”

It also helps that Soloff had a two-year stint as a quantitative analyst at a Wall Street investment bank and co-founded Metamarkets, an analytics tool used for programmatic online advertising.

Soloff’s long-term goal is to expand the scope of Premise into a real-time financial pulse that can provide immediate economic data to not only wealthy investment institutions but also regular citizens. Other platforms have similar aims — the Billion Prices Project, started by a pair of MIT professors, gathers online price listings from more than 70 countries to predict inflation trends from around the world. Such initiatives “have a real value to consumers and businesses,” the Brookings Institution’s Burtless says.

But the devil is in the data, of course. Some economists question whether locally recruited residents can reliably document data for an entire community or country.

“Surveys are of no value unless we can be assured by some means that they are representative of the underlying population,” Barry Bosworth, another economist at the Brookings Institution, said in an email. “The survey will reflect all the biases of the reporter who decides what prices to report. We may use the Internet more in the future to collect data but it will have to be used with some structure to assure that the individual quotes are representative of an even larger underlying population.”

Premise spokesperson Sara Blask said in an email that the company’s contributors capture observations at predetermined locations and intervals to assure that the sample is indeed accurate. “In this sense we are the opposite of crowdsourcing,” she said.

Premise’s dataset should grow more robust and useful as it racks up more observations.

In five years’ time, Soloff envisions millions of people around the world submitting photos and other information to Premise. He believes such a cascade of data could help keep governments more honest in the future. “Rather than relying on the official story, so to speak, [people] have an alternative read that’s generated by the citizens just like them,” he says. “We don’t need to tell them what’s happening—it’s the opposite.”

Correction: The original version of this story misstated the number of locations where Premise has launched. The company is collecting data in 50 cities.

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