A big debate in the ride-sharing industry is what the still young market will look like when it matures. There are two sides: those who believe that on-demand rides is a “winner takes all” industry, and those who think there will be room for multiple successful companies.
Sunil Paul, co-founder and CEO of on-demand ride and delivery company Sidecar, has been a big proponent of the latter view. In August of 2014, Paul told GeekWire that the winner-take-all perspective was a “very narrow view” to take. “There will be lots of winners in this category,” Paul said.
But in two days, on New Year’s Eve, Sidecar will shut down. “We will cease ride and delivery operations at 2PM Pacific Time,” Paul wrote on Tuesday (Dec. 29). He cited a “significant capital disadvantage,” which is jargon for “not enough money.” Sidecar raised $35 million across five rounds, according to CrunchBase, a website that tracks funding data for startups. That’s nothing compared to Uber’s $12 billion in debt and equity and Lyft’s $1 billion and counting.
Over the last year or so, Sidecar, perhaps realizing it wasn’t destined to win on the consumer-ride front, tried to redefine itself as a logistics and delivery platform. In February 2015 the company rolled out its big bet for this space: “People + Packages.” The idea was to combine rides for people with deliveries of stuff along similar routes. Why not pick up someone else’s Chinese takeout if you’re heading the same way?
After shuttering Sidecar, Paul says the team will turn to “strategic alternatives” and “lay the groundwork for the next big thing.” He didn’t provide any details, so it’s unclear what those alternatives will be. It’s also unclear how many employees at Sidecar will lose their jobs or where the company’s drivers will go next. Uber and Lyft are probably a good guess.