CAR WARS

A new ride-hailing app plans to beat Uber by treating its drivers better

Uber drivers have long-complained about company’s lack of benefits, training, or support—and recently about its fare cuts. The company argues that keeping fares down and preserving its freelancer model is the only way for it to provide its convenient service.

But one entrepreneur disagrees.

Juno is a soon-to-launch startup that will roll out in New York City in the spring. It will mimic Uber’s ride-hailing business model, in which civilian drivers ferry passengers around town for cash. But it plans to treat its drivers better, and pay them more.

“A lot of Uber drivers’ complaints fall on deaf ears, and Juno is literally addressing all of these pain points that Uber hasn’t done anything about for years,” founder Talmon Marco told Quartz.

Juno aims to woo drivers with specific perks. For one thing, it will pay drivers more, because the company’s commission will be much lower. Juno’s commission will be set at 10% of each fare, as opposed to Uber’s 20 to 30% (Uber’s commissions vary by city). It will also operate a 24/7 call center for drivers and customers to report issues. (Uber requires nearly all of its drivers’ complaints to go through email, where requests are often managed by outsourced staff from the Philippines.) And the company also plans to offer 50% of its founding equity to drivers.

Most notably, Marco tells Quartz that eventually Juno will let drivers choose if they want to be classified as employees or independent contractors. That distinction is the cause of a major class action lawsuit faced by Uber in California. Drivers allege that the company dictates their work environment and argue they deserve wages and benefits.

“This is one part of the industry I firmly disagree with,” Marco tells Quartz. “If I am setting the fares and you are working only with us, then you are an employee.” He said that employee drivers will be compensated through a combination of wages and bonuses. And passenger fares, he told Quartz, will be competitive with Uber and Lyft.

Marco has plenty of credibility as an entrepreneur. His biggest success was the sale of Viber, a WhatsApp-esque chat app, to Japanese web conglomerate Rakuten for $900 million. Viber trailed WhatsApp in user numbers. But it won many fans in poor countries, where data plans are expensive and telecommunications infrastructure is weak. Its interface was better than Skype’s, its call quality was strong, and it worked on platforms like Blackberry and Symbian, which were popular in Africa and the Middle East.

Many of Juno’s promised features, like optional tipping or 24/7 call center support, have long been suggested by Uber drivers, but Uber has shunned these ideas so far. Just as Marco found room in the market for a better chat app, he may find room for a more humane version of Uber.

But the ultimate challenge will be whether Juno can attract enough drivers and passengers to reach a critical mass. Harry Campbell, a part-time Uber driver who blogs his experiences at Rideshare Guy, says he has doubts Juno’s perks will being able to upend Uber’s stronghold on the ride-sharing market in New York or elsewhere.

“What it all boils down to is ‘is there enough passenger demand?'” he adds. “Recruiting driers is kind of like a chicken and egg problem. Juno will be able to recruit drivers if they have enough passenger demand. But they’re not going to be able to have enough passenger demand if they don’t have enough drivers.”

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