Uber expansion: Lessons on how to rapidly scale
How does a business scale in five years, from operations in one city to a presence in over 280? Uber, the Silicon Valley tech firm, has done just that – in the meantime disrupting the entire private car hire industry. What lessons does it offer other ambitious firms?
Uber is a local service operating on a global level. Its product is consistent across locations, but also needs to be relevant to widely-varying, small local markets. As Tom Elvidge, general manager for Uber in Leeds, told the audience at the Santander Breakthrough Summit last week, this requires strong local insight and a knowledgeable team on the ground to make it work.
For Uber, picking the right markets involves “looking at whether people are already using the app in a certain city”. It’s a good indicator of future success, says Elvidge. Uber then reviews the competitive landscape. “It’s actually helpful for us if there is a strong competitive environment, as being able to offer a new alternative puts you in a great position,” he says.
This is where the “hard graft” comes in. When launching in Leeds in November 2014, Elvidge had what he describes as “280 playbooks to work from” – proven examples of how the service could work in a city, the challenges that could be faced, and the lessons learned. “We are really well-connected, so if I’m facing a challenge in Leeds, there’s a hope it’s been faced in another city.”
But he highlights that there are “specific nuances to every single city”. This means it’s vital to have someone familiar with the location in charge – to offer local insight.
For Uber, this might be “understanding the layout of the city, the demographics, regulations, existing competition and local transport,” says Elvidge. For other firms, the requirements might be quite different.