Andrew Milgram

We came up with our own understanding of what an Uber driver's net earnings were.

And what also became pretty clear to us is that

Uber was taking advantage of an information asymmetry.

So they understood that a driver didn't really understand the full picture of their cost structure and that they were making a very cash-based decision, but they were pushing a lot of those non-cash or non-immediate cash costs onto the driver.

They were taking those liabilities on.

And ultimately, when you adjusted earnings for all of that, the driver was really under-earning what they should.

And you also saw a lot of turnover in those days because I think drivers were coming to the conclusion over time that their own individual return on invested capital wasn't sufficient.

So we started to understand that.

In fact, when I was out talking to one 70-year-old garage owner who I think had grown up as a taxi driver, his father I think had bought medallions in the 30s.

He said to me, Andrew, the reality is nobody's reinvented the economics of driving a car yet.

And until that happens, taxis remain the most durable cash flow in the system.

And over time, we proved that out to ourselves, at least.

We convinced ourselves and...

obviously our investors, that what was available here was an unbelievable market that for lots of reasons had been under-invested in terms of operations.

So there'd been lots of leverage put into the system.

I would say that folks who had owned medallions and operated fleets

had been extractive.

So they hadn't been investing in the business.

They hadn't treated the driver the way they should.

I used to begin every conversation with somebody in the space the same way.