(Aug 21): For several weeks now, the focus of attention in the so-called sharing economy has been the internal turmoil at ride-hailing giant Uber, the largest startup in the world. From allegations of sexual harassment at the company and fracases with drivers to founder and CEO Travis Kalanick’s abrupt resignation and his subsequent attempts to reassert control, from original venture capital (VC) investor Benchmark Capital filing a lawsuit to a court battle with Google on using stolen self-driving car trade secrets, Uber clearly has had more than its fair share of distractions lately. 

Challengers, such as Grab in Southeast Asia and Ola in India, have used the turmoil at Uber to boost their own coffers, raising billions of dollars of new funding as they seek to defend their turf. For its part, Chinese ride-sharing giant Didi Chuxing, earlier this month announced an investment in Estonia-based Taxify, expanding its global strategic alliances to Europe and Africa. Didi’s major investor, Japan’s SoftBank Group, already has large stakes in Grab (which also counts Didi as an investor), Ola and Brazil’s 99Taxis. Indeed, SoftBank has been making audacious overtures to grab a stake in Uber itself by wooing some of its directors.

Yet, as the land grab in the ride-hailing space gathers pace, focus is turning to why the big players, such as Uber, Didi, Grab and Ola, have yet to reach anywhere near the scale that guarantees a pathway to profitability nearly nine years after their founding. What will it take for them to make money? Are the big ride-hailing players really worth what the VCs are currently valuing them at? Uber, valued at US$69 billion ($94.35 billion) at its last funding round, for example, reported US$20 billion in gross billings and US$6.5 billion in net revenues, including revenues from uberPOOL, last year. It posted a loss of US$2.8 billion (or US$3 billion if you include the US$1 billion loss on its now discontinued China operations).

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