Workplace

The Drivers Cooperative thinks ridehailing should be owned by drivers, not venture capitalists

The Drivers Cooperative is raising $1 million through crowdfunding to offer a driver-owned alternative to Uber and Lyft in New York City.

Rows of model cars on a white background.

Since its launch, the co-op has amassed 40,000 registered users and 3,400 drivers, and completed more than 2,000 trips.

Image: Randy Tarampi via Unsplash

Uber, Lyft and other tech companies have long held a monopoly in the on-demand economy.

A new driver's co-op operating in New York seeks to change that dynamic, but it's going to be an uphill battle. The Drivers Cooperative has raised a little over $989,000, with the ultimate goal of raising $1.07 million for its ridehailing service that is owned by drivers, rather than founders, executives and venture capitalists. The cooperative told Protocol that it plans to use the crowdfunded money to further develop the app and increase marketing.

Competitors have tried and failed to challenge Uber and Lyft in the past, but the founders at The Drivers Cooperative are hoping the company's fate will be different from the others. The co-op is banking on the notion that customers want more affordable fares while also doing right by drivers and "doing a solid to New York City," The Drivers Cooperative co-founder Ken Lewis told Protocol.

"I think a sense of fairness is what every person feels when they take the cooperative," he said. " ... We're hoping that if The Drivers Cooperative can show their worth, it will show that everyone has got to share in this economy. That's one of the things we want to put the emphasis on: How can more [money] go to the people at the bottom who make the city move?"

The Drivers Cooperative pays drivers $1.64 per mile, which is higher than the required $1.26 per mile NYC minimum. The Drivers Cooperative also only takes a 15% cut from driver fares, compared to Uber's 21.5% take rate. Meanwhile, the cooperative status gives drivers true ownership in the company, which means they get back some of what they put in.

Each driver-member gets one voting share in the company, Lewis said. Drivers also get points for completing trips, recruiting other drivers, recruiting passengers, attending co-op meetings and more. The points ultimately determine the amount of profit-share each driver gets, Lewis explained.

Lewis, a longtime black-car driver who immigrated to the U.S. from the island of Grenada in the nineties, founded The Drivers Cooperative alongside Alissa Orlando, a former operations manager for Uber in East Africa, and Erik Forman, a union organizer and former member of the Independent Drivers Guild. The IDG formed as a partnership between the Machinists Union and Uber in 2016. Despite Forman's involvement with IDG, The Drivers Cooperative is a separate entity, Lewis said.

A key point of contention in the gig economy centers around whether drivers should be independent contractors or employees. In the case of The Drivers Cooperative, driver-members are not employees, Lewis said.

"I think the contractor or full time discussion is one that will continue because most drivers, of course, love the flexibility of this job," Lewis said. "But I do think that there has to be more responsibility of the company, much akin to what the federal standards are for full-time workers."

While The Drivers Cooperative does not offer drivers health insurance, which is one of the biggest concerns many drivers' rights organizations raise, the goal is to eventually offer that benefit.

"It is definitely a long-term goal," Lewis said about providing health insurance to drivers. "Though we cannot promise health care immediately, we can continue to fight to give workers the right to get those kind of benefits. The whole independent contractor scheme, for instance, has to be readdressed so people who work all these long hours can get benefits. And we will see in any way if it's possible how we can [offer health insurance]. At the moment we're just trying to survive."

Lewis said The Drivers Cooperative's vision is to better support drivers. Even if Uber and Lyft were to change their business models and give drivers ownership of their respective companies, for example, "that would be a big win for us," Lewis said.

In a statement to Protocol, a Lyft spokesperson said, "We're constantly working to improve the driver experience on our platform and share the goals of allowing drivers to work efficiently and independently."

Uber did not respond to Protocol's request for comment.

The Drivers Cooperative is in its early days, having just launched the rideshare app, Co-Op Ride, in late May. Since then, the co-op has amassed 40,000 registered users and 3,400 drivers, and completed more than 2,000 trips. The company is nowhere close to being on par with Uber and Lyft, but Lewis said The Drivers Cooperative "will be fine" even if it only obtains 3% of the market share in New York.

Since the demand is not yet there, The Drivers Cooperative encourages drivers to work for Uber or Lyft as the co-op ramps up.

"As much as drivers support and love the cooperative, if the co-op is not busy enough, we'll have to work with Uber and Lyft," Lewis said.

The Drivers Cooperative doesn't envision completely taking down Uber and Lyft but it does hope to be able to expand the co-op rideshare model into other markets. As the saying goes, Lewis said, if The Drivers Cooperative can make it in New York, "you can make it anywhere."

Lewis added, "This is a free market and Uber has a right to exist, and so do companies formed by workers ... I just think we have to become far more people-centered and worker-centered in terms of how the wealth is spread, and in terms of how riches are distributed."

Fintech

Judge Zia Faruqui is trying to teach you crypto, one ‘SNL’ reference at a time

His decisions on major cryptocurrency cases have quoted "The Big Lebowski," "SNL," and "Dr. Strangelove." That’s because he wants you — yes, you — to read them.

The ways Zia Faruqui (right) has weighed on cases that have come before him can give lawyers clues as to what legal frameworks will pass muster.

Photo: Carolyn Van Houten/The Washington Post via Getty Images

“Cryptocurrency and related software analytics tools are ‘The wave of the future, Dude. One hundred percent electronic.’”

That’s not a quote from "The Big Lebowski" — at least, not directly. It’s a quote from a Washington, D.C., district court memorandum opinion on the role cryptocurrency analytics tools can play in government investigations. The author is Magistrate Judge Zia Faruqui.

Keep ReadingShow less
Veronica Irwin

Veronica Irwin (@vronirwin) is a San Francisco-based reporter at Protocol covering fintech. Previously she was at the San Francisco Examiner, covering tech from a hyper-local angle. Before that, her byline was featured in SF Weekly, The Nation, Techworker, Ms. Magazine and The Frisc.

The financial technology transformation is driving competition, creating consumer choice, and shaping the future of finance. Hear from seven fintech leaders who are reshaping the future of finance, and join the inaugural Financial Technology Association Fintech Summit to learn more.

Keep ReadingShow less
FTA
The Financial Technology Association (FTA) represents industry leaders shaping the future of finance. We champion the power of technology-centered financial services and advocate for the modernization of financial regulation to support inclusion and responsible innovation.
Enterprise

AWS CEO: The cloud isn’t just about technology

As AWS preps for its annual re:Invent conference, Adam Selipsky talks product strategy, support for hybrid environments, and the value of the cloud in uncertain economic times.

Photo: Noah Berger/Getty Images for Amazon Web Services

AWS is gearing up for re:Invent, its annual cloud computing conference where announcements this year are expected to focus on its end-to-end data strategy and delivering new industry-specific services.

It will be the second re:Invent with CEO Adam Selipsky as leader of the industry’s largest cloud provider after his return last year to AWS from data visualization company Tableau Software.

Keep ReadingShow less
Donna Goodison

Donna Goodison (@dgoodison) is Protocol's senior reporter focusing on enterprise infrastructure technology, from the 'Big 3' cloud computing providers to data centers. She previously covered the public cloud at CRN after 15 years as a business reporter for the Boston Herald. Based in Massachusetts, she also has worked as a Boston Globe freelancer, business reporter at the Boston Business Journal and real estate reporter at Banker & Tradesman after toiling at weekly newspapers.

Image: Protocol

We launched Protocol in February 2020 to cover the evolving power center of tech. It is with deep sadness that just under three years later, we are winding down the publication.

As of today, we will not publish any more stories. All of our newsletters, apart from our flagship, Source Code, will no longer be sent. Source Code will be published and sent for the next few weeks, but it will also close down in December.

Keep ReadingShow less
Bennett Richardson

Bennett Richardson ( @bennettrich) is the president of Protocol. Prior to joining Protocol in 2019, Bennett was executive director of global strategic partnerships at POLITICO, where he led strategic growth efforts including POLITICO's European expansion in Brussels and POLITICO's creative agency POLITICO Focus during his six years with the company. Prior to POLITICO, Bennett was co-founder and CMO of Hinge, the mobile dating company recently acquired by Match Group. Bennett began his career in digital and social brand marketing working with major brands across tech, energy, and health care at leading marketing and communications agencies including Edelman and GMMB. Bennett is originally from Portland, Maine, and received his bachelor's degree from Colgate University.

Enterprise

Why large enterprises struggle to find suitable platforms for MLops

As companies expand their use of AI beyond running just a few machine learning models, and as larger enterprises go from deploying hundreds of models to thousands and even millions of models, ML practitioners say that they have yet to find what they need from prepackaged MLops systems.

As companies expand their use of AI beyond running just a few machine learning models, ML practitioners say that they have yet to find what they need from prepackaged MLops systems.

Photo: artpartner-images via Getty Images

On any given day, Lily AI runs hundreds of machine learning models using computer vision and natural language processing that are customized for its retail and ecommerce clients to make website product recommendations, forecast demand, and plan merchandising. But this spring when the company was in the market for a machine learning operations platform to manage its expanding model roster, it wasn’t easy to find a suitable off-the-shelf system that could handle such a large number of models in deployment while also meeting other criteria.

Some MLops platforms are not well-suited for maintaining even more than 10 machine learning models when it comes to keeping track of data, navigating their user interfaces, or reporting capabilities, Matthew Nokleby, machine learning manager for Lily AI’s product intelligence team, told Protocol earlier this year. “The duct tape starts to show,” he said.

Keep ReadingShow less
Kate Kaye

Kate Kaye is an award-winning multimedia reporter digging deep and telling print, digital and audio stories. She covers AI and data for Protocol. Her reporting on AI and tech ethics issues has been published in OneZero, Fast Company, MIT Technology Review, CityLab, Ad Age and Digiday and heard on NPR. Kate is the creator of RedTailMedia.org and is the author of "Campaign '08: A Turning Point for Digital Media," a book about how the 2008 presidential campaigns used digital media and data.

Latest Stories
Bulletins