As an entrepreneur, the months that go by where all you do is invest in your business and get zero in return make it hard to pay the bills and keep on the path of following your passion. Although not a perfect solution given it is still considerably lower earnings potential than consulting gigs, being a ride share driver for Uber or Lyft or the like allows a level of flexibility to earning that few options could. Which led me to checking out the Uber driver criteria, the hot spots, and reading reviews online as to how much could I actually make. Then I jumped.
Why did I start with Uber? Well admittedly I’m a left brain structured person so their logo is far more appealing to me than the pink mustache of Lyft. I’d actually be curious to see if there’s a correlation between MBTI Thinkers choosing Uber and MBTI Feelers choosing Lyft. Needless to say, it was the logo that made me choose Uber. From there I found myself using it heavily in New York City when I had an income, racking up well over a hundred rides. It’s a system I know quite well and seemed like the best candidate to drive with.
My first hurdle was not having a car, a financial obligation I’d enjoyed not having in my early stage start-up situation. Now Uber can rent a 4-passenger car that qualifies for their UberX program for around $200/week. That’s $800/month. UberX is the lowest paying category as a driver, though it’s the most plentiful in terms of paying customers (i.e. quantity over margin). Being that my brain only works in one way – maximize value, minimize cost/risk – renting from Uber seemed like a bad choice for me (maybe later if I can prove out the concept and make some big earnings?). My car search was kicked off and focused on what is the best vehicle I could afford that would give me the largest ROI.
Uber provides all the details about their driving categories online. For most drivers who don’t carry commercial insurance, there are three options (at least in Denver, can’t speak for elsewhere). UberX is the base level category, earns the lowest, seats 4 passengers + you, and the car can’t be more than 15 years old. UberXL is the next step up, earns almost twice the amount as UberX, seats 6 passengers + you, and can still be a 15 year old car. The final option is UberSelect, this pays exactly twice as much as UberX, can fit 4 or 6 passengers, but must have leather seats and be within certain Make/Model/Year requirements. In summary, if you can hit all three your earnings will be maximized.
Taking all this data from the Uber Driver Requirements, I mapped out all the used cars on the market in Denver that were under $12,000 to see which ones could fit all three to maximize ROI. This resulted in one car, a 2008 Acura MDX. It was the top of my price point, but still within budget since it had tons of mileage. It would expire with UberSelect due to the 2008 year when they renew their qualifications in March, but the options were limited within my price range and this was the best choice for my strategy. Only time will tell if it was worth it, some say just doing UberX and UberSelect with a 4-passenger sedan (which is much cheaper than the AWD 7-passenger SUV I chose) is the way to go. We shall see.
The second hurdle was going through all the background checks. Colorado is notoriously stricter than most states, so this process is likely more involved than your state/region. First know that Uber has no phone number to call to help you through figuring out the steps, but they do offer online chat with agents that know their stuff and an in-person facility (they call these Greenlight Hubs). Step 1 of the checks was confirming the vehicle I just purchased would be in the condition they were comfortable with, so I headed to the Greenlight office where they handed me an inspection form that the dealership could complete. Alternatively, they’ll do the inspection for $15 (which was probably cheaper than the gas I spent driving around… but alas).
Shortly after I received an invitation from Uber to attend their 101 class at the Greenlight Hub. Although the $5 in gas each way to the Hub was kind of annoying, I thought it was a good investment so I headed back there. At first the guy literally read verbatim the PowerPoint and my consulting self cringed… though as we started asking questions (ok, so maybe I was the one asking questions), he knew the answers, he could speak to them. As I started firing off my laundry list of what-if’s, others started asking questions too and the session ended up taking twice as long as was planned though we were all super engaged and left armed with so much knowledge.
Step 2 of the checks was starting the driver application online which kicks into gear the background check. They look at your credit, your driving record, any criminal or drug activities, and just overall information to make sure you are not a liability for them and their passengers. All they ask from you is your social security number, no need to provide past jobs, references, etc. Some people said theirs cleared in 1-2 days, mine took 8 days. Perhaps because I’ve moved between so many states or perhaps because I have a generically common name that requires more in-depth validation to ensure the person who did bad things wasn’t me. Who knows.
Step 3 of the checks was to get a medical inspection to ensure I was fit to drive. The Uber Hub offers this for $50 or if you can find it cheaper or want to deal with insurance/booking a doctor’s appointment, they are ok with that too. After waiting 8 days for my background check to clear I didn’t want to waste any more time so I elected to do the walk-in $50 medical check at their hub. It took around 15 minutes, they checked my eye sight, my hearing, my blood pressure, my heart beat, my breathing, and asked me a bunch of questions about my health. No blood draw, no urine sample, no taking off my clothes, etc.
The last hurdle was finishing the paperwork and getting it all submitted so I could be put into official approved driver status. Planning ahead and not really knowing how to prove registration and my license plate number with my new used car, I just brought the entire packet from the dealership and after my medical appointment had them help me get things sorted. First, the dealership did a temporary registration in my name that we could use. On it contained a license plate number that tied to my temporary tag, which they were fine with. Once I get my real license plate, they said I’d have to drive back into the Hub and they’d update it.
Finally, many days later, many pieces of paperwork, inspections, checks, etc. I got the approval email. I was officially an Uber driver. Start the drum roll please! Having not seen money in what felt like forever, the thought of finally getting cash flow was so darn exciting I headed straight to the target to get my driver supplies – Kleenex, car chargers (for me and the passengers), cell phone holder, air freshener spray, sanitizing wipes, breath mints, and pepper spray. Carrying guns is against the Uber policy, though I suspect many still do it, especially in states like Colorado where concealed weapons are allowed under permit. Do I carry? Well that I can’t answer. In the end, you’ll need to do what’s right for you.
Probably the most important thing I got from the Uber 101 class was that they are okay if I always choose safety. If I feel threatened, I can cancel the trip without penalty. If the person seems like they could hurt me, I can cancel the trip no penalty. Obviously, they don’t want you cancelling out of discrimination, but they support safety first. Even if midway through the trip the person becomes volatile, I can stop the car, get them out, and end the trip without penalty. Now how often will that happen, only time will tell. Additionally, how easy will that person be to identify from the start or be able to remove from my car when they become hostile, well that’s also to be determined. Let’s just hope those are just what if’s and not reality, but they are an active risk to be aware of.
More to come!
PS – if you’re interested in joining Uber, you can use my link to get a sign-on bonus: https://partners.uber.com/i/sarac13944ui