The tech community was as divided as everyone else.
Joshua Baer, founder of Capital Factory, the downtown technology incubator, has been a critic of the proposed regulations. He said he believes the vote sent signals that Austin is hostile to startups.
“Losing Uber and Lyft is a major setback to our reputation as an innovative city and technology hub that is already impacting decisions made by venture capitalists and Fortune 500 executives,” Baer said Monday. “It’s critical that the tech community and City Council come together… before our reputation is damaged further.”
But others scoffed at the notion that the Prop 1 vote could do any long-term damage to Austin’s entrepreneurial reputation. Austin economist Brian Kelsey said the vote is unlikely to have negative ripple effects on startups.
“Prop. 1 may be a setback in how the outside world views our seriousness in local policy making, but branding Austin as ‘anti-innovation” is ludicrous,’ ” Kelsey said. ” If the existence of two ride-sharing companies locally has an impact on your business model, then I’d say Prop. 1 should probably be the least of your concerns.”
[…]
Initially, many tech workers and entrepreneurs said they thought the vote would get industry support because of general opposition to more regulation of emerging technology business models.
But they now say Uber and Lyft’s aggressive marketing tactics derailed the discussion.
“I think it backfired in the tech community,” said Austin entrepreneur Richard Bagdonas, who supported the proposition. “I have talked to many people who said ‘I’m pro-Uber and pro-Lyft, but the number of flyers, calls and texts I received pushed me over the edge.’ ”
[…]
Turnout for Prop 1 was dominated by “traditional” voters who reliably show up to vote in state and local elections, Littlefield said. Early voting data showed that 70 percent of the Prop 1 voters were these traditional voters, [Baer] said.
“I’ve seen it time and time again,” he said. “There are people who will vote in May elections and there are people that no matter how vitally important the results of the May election are to their own personal interests, they simply do not vote.”
Political experts said Uber and Lyft underestimated whether support for their service translated into votes.
Take David Goss. He’s a 40-year-old systems engineer for EMC Corp. in Austin. He regularly uses Uber when he’s going downtown for drinks and needs a sober ride home. On paper, Goss sounds like he would be for Prop 1.
But Goss said he voted against the measure. “I do love Uber, I use it all the time,” Goss said. But he said he wasn’t in favor with just letting Uber and Lyft write their own regulations.
“I definitely felt that there was some middle ground, we needed to find a way to ensure the rides were safe and make sure the employees were treated fairly,” he said.
Austin marketing veteran and entrepreneur Josh Jones-Dilworth, who opposed the proposition, said he watched as the discussion — and tech workers’ opinions — morphed.
“It started as a safety issue, and then it became an innovation issue, and then evolved into a corporate bullying issue,” Jones-Dilworth said. “It’s a complex issue, and there was never a consensus. I know a lot of people who changed their mind. And I know a lot of people who stayed on the sidelines because they thought this was a no-win situation.”
David Broockman, a business professor at Stanford University and an Austin native, said startups like Uber and Lyft view themselves as the underdog taking on an established industry: taxis.
“In Silicon Valley there is a tendency to view startups as David against Goliath,” he said, but that doesn’t always translate outside the Bay area, he said, where they are viewed instead as the Goliaths.
Hard to be the David when you’re backed by a few billion dollars in market valuation. For all that people like Uber and Lyft’s service, this election has shown us that liking only goes so far. I’d like to think that they will consider whether they should maybe change their approach a bit, to be more conciliatory and open to compromise, but so far there’s no indication of that. Perhaps we’ll see that when the inevitable statewide regulation bill comes up in the Lege. For all the bluster from some Republicans following Saturday’s vote, the passage of such a bill is not a slam dunk. It’s still the case that collaboration gets you farther in the Capitol than a bludgeon.
In the meantime, more players are hitting the scene.
While Uber has grown into a global behemoth by deploying many thousands of independent contractors, many of those drivers aren’t happy. New ride-sharing startup Juno–which has so far only launched in stealth mode in New York City–will try to make those drivers into its secret weapon.
Talmon Marco, former cofounder and CEO of messaging app Viber (which sold to Rakuten for $900 million in 2014), confirmed to FORBES that he is behind Juno, and promised that the new service under development “will have multiple capabilities that will differentiate it from other such services.”
But likely its biggest differentiator will be driver relations. While Uber has demonstrated its willingness to anger drivers by slashing prices and commissions over the last few years, Juno plans to take only a 10% commission from drivers. And it claims to have “reserved” 50% of its founding shares for drivers.
“At the heart of Juno is a belief that it’s time for a ride sharing service that treated drivers right,” Marco tells FORBES. “It’s time for an ethical, socially responsible ride sharing service. And that’s what we are doing.”
Sounds promising. As I said yesterday, the best thing that could come out of the Austin referendum is for multiple new rideshare services to emerge and find purchase. I mean, if part of the problem with traditional cab companies was that they were shielded by regulations from facing a competitive market, then surely we don’t want Uber and Lyft to be the only game in town for rideshare, right? A competitive market implies the need for competitors, after all. There would be a certain justice in all this if Uber and Lyft’s self-imposed departure from Austin helps enable those competitors. Chris Tomlinson, who has a few choice words for how Uber and Lyft treat drivers, and Roy have more.