Salmon Upstream, LLC

Developing and implementing real-world community solutions.

Needs: a new approach.

I am not even going to dwell on the fact that we are all responsible for our neighbors who have genuine transportation issues – regardless of what those issues may be – so their needs are, in fact, our needs.

We all talk a lot about needs. “We need this.” “Society needs that.” Some needs are more personal, such as the need to be able to get another beer without getting off the couch. But others are literally universal, like transportation. If you are reading this blog, most likely you have already sorted out your personal transportation issues, but don’t be fooled into thinking this is not a problem that directly affects you. Consider our growing downtown. What is the major issue that is going to arise from this remarkable expansion? Transportation. Parking. Traffic. Whether you live downtown or want to get downtown, this becomes the biggest disadvantage arising from this increased utilization. Even if you never take a step onto one of the new walks along the riverside, the entire city benefits from the increased vitality, so it’s success is shared by us all.

I am not even going to dwell on the fact that we are all responsible for our neighbors who have genuine transportation issues – regardless of what those issues may be – so their needs are, in fact, our needs.

How do we address needs in the U.S.? Most commonly, we capitalize on them. Uber is a perfect example. Uber is an investor-driven, innovative company that was created to make money – lots of money – off of a societal need. The problem with this approach is two-fold: first, the goal is not to satisfy the need, the goal is to make money. That means some portion of the need will go unmet. We can even predict what will be left out: it will be the areas that are the most difficult to address, because the added complexities decrease profitability. Like kids. Yes, being able to get children where they need to go is a big need, but those energetic little devils introduce all sorts of issues that slash the bottom line. So we just aren’t going to go there, OK? Though it is always our go-to method, the capitalist approach fails to address the whole issue, and that difficult area is often the most important.

Which brings us to the second problem: taking money from an area of our society that has a genuine need. Societal needs are areas where we should be putting stuff in, not taking it out. Remember that money is nothing more than a convenient way for us to exchange goods and services. So while Uber is a transportation asset (it does provide a novel way of moving people around), it is also removing goods and services (in the form of money) from a community need. That’s not the way to solve a problem.

Not to sell us short: we are very active in trying to address needs in other altruistic ways. There are numerous small business, non-profits, government-funded services, and volunteer-based organizations that work tirelessly to attempt to close the gaps on needs of all kinds, including transportation. Each of these entities represents an important service that provides a tangible and potentially crucial benefit to its customers, but they lack a fundamental element that tremendously limits their overall effectiveness: connection.

To realize maximum potential, you have to connect all of your resources. Today, we have methods of connectivity that were literally fantasy a few decades ago. And yet, in all areas of our society, we remain in silos. Why? Because making these connections limits the ability to capitalize on the need. If the need goes away…

I think we can do better. Much better.

Let’s start by considering the need, and then using our resources collectively and cooperatively to address that need. This is the fundamental ideology upon which MoveUP has been created. The world is full of ideology, but if there is no realistic application, it is nothing more than angry rhetoric or wishful thinking. This is more than just a transportation solution, it is intended to be proof of a concept: *when we are connected and work cooperatively, we can make fantasy a reality. *

Transportation is a need. So let’s connect all of our assets, and make sure that we provide a means of transportation to everyone. And let’s do it in a cooperative way, maximizing the utilization and effectiveness of all of our current assets, creating an environment for the growth of novel solutions, and ensuring the safety and security of our citizens, young and old.

Because it is a need, we should provide it for free. Before you go off thinking we are giving free transportation to everyone, sit back down. The connection is actually the fundamental need, and that’s the part we are going to be giving for free. Think again of Uber: what is it about Uber that is truly innovative? It is the method of connection between the rider and the driver. Unfortunately for Uber (and all of its investors), the intellectual property is impossible to contain. No, you can’t just steal the code for the app, but the concept cannot be patented, and building an app with similar functionality is not that hard. Which is why we have Lyft and all of the other competing rideshare companies.

And that competition defines their flaw: none intends to fix the need, each intends to capitalize on it.

Uber does not give its connection for free. If you want that connection, you have to be part of the Uber system, and you are going to pay to be there. Every ride. So to make money – Uber’s ultimate goal – they need as many rides as possible. And that means market share. Uber doesn’t want you to use Lyft, nor a cab, nor any other means of transportation. And to build market share, they have been buying it.

The vast majority of Uber’s investment – and we are talking about a whole lot of money – has been to establish market share. Because customers want the lowest fare, in potentially valuable markets like New York City, Uber subsidizes the rides, paying the drivers out of pocket to bring the rider’s cost below competitors. This has made the Uber name synonymous with the entire concept of a rideshare app. Flawed assumption number two is that people will remain loyal. At some point, Uber has to stop putting money into these markets. And when they do, they will leave behind a disconnected transportation company no different than any other. This is why Uber has never turned a profit, and likely never will. <Add sad emoji>

A company structured like Uber wants the ride to be cheap to draw people to the system. They want the drivers to rely on the connection for customers. They want to pay the drivers as little as possible, because they want to be able to take as much as possible for themselves. It’s all about market share, because it’s all about profits. These goals are simply not aligned with our own.

You may think that you want transportation to be as inexpensive as possible, but that’s not really accurate. We want transportation to be effective, first and foremost. There are times where the cheapest ride is what you are after, but there are times where cost is not most important variable, where meeting a specialized need takes precedence. Like getting a kid to an activity. Or getting a patient to an appointment. Or getting a person in a wheelchair to an event. Or going in style to an anniversary dinner. These are all needs, and connecting the assets together increases the effectiveness of all. Plus, these transportation companies and drivers represent businesses in our community working to fulfill a fundamental need in our society, and they deserve to be compensated fairly for their work. We want every possible cent that leaves the pocket of the rider to go into the pocket of the driver. Which is why the connection is free.

It has to be effective, reasonably priced, but also high quality. We can ensure this quality by setting standards and offering choices. By creating connections, we are building a network. And that is an incredibly important distinction that underlies the absolute uniqueness of this project. It creates possibilities that are completely new, and it gives us the ability to successfully do things that other cities have failed to accomplish. There are very important lessons buried in the story of Ride Austin that have been used to assure the success of MoveUP.

Several years ago, the citizens of Austin, Texas decided that the standards for drivers for what are now termed transportation network companies – or TNCs – was too low. To streamline the process for maximum profits, companies like Uber and Lyft set the bar used to vet their drivers lower than that for city taxi drivers, who, among other things, submit a fingerprint card for increased security of passengers. Fingerprinting drivers is virtually impossible to adapt to a national, internet-based transportation company. So, when Austin passed a city ordinance requiring drivers be fingerprinted, they effectively shut down Uber and Lyft in their city. This left a huge transportation vacuum (which speaks to the effectiveness of the rideshare app, appropriately applied), and Ride Austin was created to fill that void.

Ride Austin is a non-profit TNC that utilizes similar technology to its competitors, but sets higher standards for its drivers, including fingerprinting. With the new ordinance making it the only option, it was able to thrive. It also introduced some clever features that made it more attractive. (I have, without remorse, stolen them). One of those is a feature they dubbed “Round Up”, which lets riders round up their fare to the nearest dollar and direct the funds to their favorite on a list of local charities. We are going to have a similar feature, but the funds will go back into city transportation, as that is the need we are looking to address.

The mistake Ride Austin made was thinking like its competitors: despite being a non-profit, its ultimate goal was still about market share. By offering a home-grown alternative and higher quality, investors gambled some seven million dollars on the hope of beating other TNCs at their own game. And where did all the money go? Subsidizing fares in an effort to compete, which in fact was their fatal mistake: don’t hit a guy with a stick (in this case, money) when the other guy’s stick is literally 100x bigger than yours. Uber and Lyft lobbied the governor of Texas and overran the local legislation. Then they poured money back into their newly revived market and stuffed Ride Austin into a tiny little box where it is today, gasping for breath.

Lesson learned: don’t compete with Uber and Lyft at a game they created. Instead, use them as an asset in a completely new game that we create.

If the goal is to fulfill a need, then shutting down other TNC’s is not part of the plan. Just the opposite: you want to increase utilization. If Uber is working, that’s a good thing. The only real disappointment is that Lynchburg is not a valuable market, so Uber is not subsidizing rides here in an effort to secure market share, because that is literally money going into transportation, which we would welcome with open arms! There is a place in our city for Uber (well, for a little while). The last thing we want to do is interrupt current services. Instead, we will offer those drivers a connection to our network.

And that is how we accomplish what Ride Austin set out to do: set quality standards for our drivers.

Since inception, Uber has attempted to dodge responsibility. They have argued that they are not an employer but a connection, and thus not subject to the same rules and regulations as taxi companies. But last year, the EU’s highest court disagreed, handing the worlds highest-valued start-up a massive defeat. Uber operates like any other employer: they set the standards, they set the fares, they connect drivers to clients. This has left the drivers in a state of legal limbo: money is changing hands for services, so someone has to be the employer. It’s either Uber, or the drivers. Which one is it? Uber doesn’t really want it to be either: if Uber is the employer, then Uber is subject to regulations as such. If the drivers are self-employed, then those drivers have to meet the standards of the location where they are operating. And using Austin as an example, those standards might not work towards Uber’s ultimate financial goals.

Instead of attempting to slip through the cracks in the system, we are going to redefine that system, and build it to our own standards. Don’t build a transportation company pretending to be a connection, instead build a genuine connection – a network linking all of our assets together. This critical distinction is what allows us to not only to set quality standards for any entity that wants to participate, but to create standards for every possible asset that we need, including the tough ones, like disabled people and children, even people who can’t use a smart phone (try that one, Uber).

The best example: polygraphs. Polygraphs – aka lie detectors – are utilized in some segments of our society to help screen out people who might not be the best suited to a sensitive job, like the police force. They are not perfect, but they are effective. They are also heavily regulated, primarily by the Employee Polygraph Protection Act of 1988, a federal law that prevents employers from using them for pre-employment screening, except in certain circumstances such as security or pharmaceutical services. When you start thinking about what you would expect from a driver that is being connected to children, the polygraph has more than a little appeal, but there is no exemption for transportation companies. However, if you aren’t an employer, everything changes.

The reasons why a TNC would never consider a polygraph in any facet of their operation are too numerous to count, but none of these are limits for a small city that wants to assure the safety of its citizens. Even the cost is not prohibitive: is $200 too much to spend on someone in whom you will entrust the safety of your child? But that is not the point. The take-home message is that we will have the ability to set the standards, and to set them anywhere we want. You don’t have to be part of the network, but if you want sign up, you will play by our rules.

Next, we have to reexamine our regulations concerning drivers. These regulations, as in most cities, are found in the city code. There is a long history involving the economy, politics, industry, and—of course—money, wrapped up in those laws. At no point during the creation of these policies was a digital network linking all of the assets considered in the equation. It’s time to have another look, this time with the goal of collectively addressing our city’s transportation needs.

When it comes to politics, nothing is predictable. Does MoveUP’s success depend upon favorable rulings by Lynchburg City Council? Actually, no. MoveUP is designed to accommodate any of our current employed drivers, everything from taxis and limos to medical transport, improving their utilization by facilitating their connection to riders and expanding payment options. This can happen without any changes. But as it stands today, drivers operating under the umbrella of a TNC—Uber and Lyft—will be trapped in the very limbo that was created to let them skirt the rules. They will still have a role, but they won’t be connected, and an important element of the system will remain siloed. If, however, we re-write the definition of what it is to be a taxi driver to fit our new and dramatically enhanced capabilities, we can both exponentially increase the available assets and improve the financial success of those assets.

Furthermore, many regulations disappear when you apply them to volunteers. When no money changes hands, things get much simpler. The features of MoveUP that are the most innovative involve the ability to empower volunteers to help close gaps, while actually increasing the utilization of our for-profit assets.

Let’s say a church congregation includes several disabled members who need assistance getting various places, including activities unrelated to healthcare (just because you are disabled doesn’t mean you don’t need a little fun in your life). The church has a van and drivers, and a desire to help, but the van won’t accommodate those with the most difficult needs, such as wheelchairs. Today, our resources are limited. Soon, we will have options. MoveUP will allow volunteer drivers to fill transportation needs of our city, and the fares from the rides they provide will go into a community account. The example church van may not be able to transport people in wheelchairs, but it can easily shuttle people to and from downtown. The funds in that account can then be disbursed to cover the transportation needs of others in our community, such as paying for a medical transport company to take wheelchair-bound folks anywhere they need to go.

It’s all about connections.

I have lost count of the number of times I have been asked: how is this going to make money? Remember, it is about fulfilling a need, not making money. Ok, then who is going to pay for it? In terms of building the actual network, we will have to shoulder those costs. But that amount – less than $150,000 for all the bells and whistles – is almost laughably small. But who is going to pay to administer it? Who is going to run this system? Well, we already are. We are already doing all of this, or trying to. Or we are simply failing to provide needed transportation because we don’t have enough options. And suffering the consequences, like missed appointments, missed employment, missed business opportunities. At present, we are just doing our best without the connections that would let us do much, much more. The people doing these jobs now—transportation at Centra Health, social workers in the school system, GLTC, staff at LRBA, you name it—we can empower them to do the same things, but better and more efficiently.

And because the system is ours, we get to build it exactly the way we want it. Even the app itself is going to be built just for us, accounting for aspects of our culture that cannot be ignored. And every clever feature is already being integrated, including some you probably never thought about: GPS navigation? Check. Electronic payment? Check. “Round up”? Check (Sorry Ivan, but I did beg to partner with Ride Austin). How about the ability of riders to choose from all available assets, sorting them by price, speed, or rating; or simply picking out the driver of their choice? Can do, and that is clever. Donate to the system? Yes. Volunteer? Yup. Ability for a driver to waive the fare? We can do that. Schedule a ride for later? Yup. Bill for a ride after the fact? What a great idea! How about add other features down the road? Uh, yeah… because it’s ours!

Connections are the key to living cooperatively, to moving our society to the next level. And this is just the first part, the Proof of Concept. There are other components under development, including LinkUP, an interactive database which is going to address our fundamental need for societal connections. Like MoveUP, it is designed to address the need, not capitalize on it. (Think Facebook, which is capitalizing on the need for societal connections, but fails to fulfill the need in order to maintain its fundamental purpose: making money). LinkUP is going to work in synergy with MoveUP, further empowering us to live together.

But, one need at a time…


Uber and the EU.

Ride Austin

Employee Polygraph Protection Act

Lynchburg City Code, Chapter 37, Taxicabs, Rental Cars