The Death Of Car Ownership: The Trillion Dollar Trend Upending The Auto Industry
LONDON, June 24, 2020 -- With combined market caps of some $70 billion, Uber and Lyft are severely disrupting the giant auto industry. But their business models are broken, and the giant disruptors may about to be disrupted themselves. Mentioned in today's commentary includes: BlackRock , Facebook , Google , Microsoft , NextEra Energy .
That $70 billion for Uber and Lyft is the same as the top three American automakers--GM, Ford and Chrysler--combined. Now, a startup that launched in late 2019 in Canada is looking to challenge them.
Facedrive is leading the evolution of shared mobility, and it's got the new business model to lure in big capital that's tired of the big competitors' cash burn, bad press and endless unprofitability.
It's sharp, sleek, ultra-high-tech, eco-friendly and it does three things that no ride-sharing company has ever done: It is the first to offer EVs and hybrids, and to plant trees to offset its carbon footprint. It brings cities and communities on as stakeholders, rather than defying them, and treats its drivers as people who deserve living wages.
It views shared mobility as much more than a ride and has launched multiple revenue streams that take advantage of the rider relationship. And now, it's going global after a series of smart acquisitions and new service launches that have positioned it to be a key challenger to the shared mobility throne.
It's hard to argue with the $30-billion-plus megatrend of sustainable investing that says disruption is in order. Here are 5 Reasons to keep a close eye on this sector right now:
#1 What Big Capital Wants
There's a reason BlackRock is blowing Wall Street out of the water right now--sustainable investing. ESG (environmental, social and governance) investing isn't just a fad anymore--it's minting millionaires and billionaires. It's in high demand, and it's pressuring companies to make major changes. It's the ethical squeeze of the century.
From Jeff Bezos' $10-billion commitment to a Global Earth Fund to BlackRock CEO Larry Fink, we're now seeing major ESG assets under management. BlackRock will increase its ESG assets from $90 billion to $1 trillion within a decade.
BlackRock (BLK) needs no introduction. It is the world's largest global investment management corporation, with over $7.4 trillion in assets under management. With clients in over 100 different countries, it is the de facto leader in its field.
In 2017, BlackRock underwent a major shift in its investment strategy, prioritizing stocks with high ESG ratings. BlackRock's focus on technology and sustainability has fueled the new trend in the marketplace, pushing even more investors to consciously consider where they put their money.
And tech giants are doing their part, as well. Facebook (FB), as one of the world's largest technology companies, has completely changed the game. It has taken a particularly innovative approach in creating a more sustainable future and has become an example for the entire industry. Its data centers are some of the most energy-efficient - and water-efficient - in the world.
And it's only getting started. By the end of 2020, Facebook is aiming to have all of its data centers running on 100% renewable energy. Additionally, Facebook has committed to adding over 4.0 GW of renewable energy to the grid.
Google (GOOGL) is another tech giant going green. It is focused on raising the bar for smart use of the world's resources. Like Facebook, Google is creating sustainable, energy-efficient data centers and workplaces. It is also leveraging artificial intelligence to develop more sustainable energy use.
Not only is Google changing the game in its own operations, it is also building a completely sustainable supply chain. And it isn't stopping there. It is also working with its partner companies to help them go green!
Microsoft (MSFT) is going above and beyond in its emissions goals, aiming to be carbon neutral in the next ten years. A feat that will not be an easy task for such a massive technology corporation. Additionally, Microsoft is has also pioneered new solutions to aid other companies in curbing their emissions as well.
Microsoft has built hardware and software to help monitor and better understand the effect of different institutions have on the planet, gathering data to better figure out how companies and people can improve. The company is creating tools to better handle the world's growing waste crisis.
And of course, energy companies are in huge focus as the ESG trend takes off. NextEra Energy (NEE), the world leader in solar and wind producer, is playing a crucial role in the course towards sustainability. In fact, in 2018, the business was the top capital investor in green energy facilities and the 5th biggest investor across all sectors.
In addition to its huge influence on global climate change, it has a plan to invest another $55 billion in American energy facilities in the next 2 years. All while keeping a firm dedication to minimize its reliance on foreign oil. Since 2001, it has detached itself from foreign oil almost entirely, announcing a 98% decline over the past twenty years. Much more enticing, however, is its dedication to developing investor value. Over the past 15 years, investors have seen 945% returns.
And word on the street is that BlackRock has now replaced Goldman Sachs to become the most important banking company in the world. BlackRock is all about technology, and all about mitigating risk through sustainable companies.
That's exactly what Facedrive is all about, too. And it fixes things that are wrong with giants Uber and Lyft in the high-tech, shared-mobility world that has lifted BlackRock to "4th branch of government" status.
Ride-sharing has been anything BUT sustainable. It's having a hugely negative impact on the environment, with estimates that the average ride-hail results in nearly 70% more pollution than whatever transportation it displaced. That's hardly the choice for eco-conscious Millennials.
Facedrive's next-gen ride-sharing is the first to offer customers a choice for every ride; whether they want an EV, a hybrid, or a conventional car. Then it offsets CO2 by planting trees along the way.
The Canadian startup has positioned itself to help solve ride-sharing's environmental problem by changing its footprint, —and aims to do so without sacrificing profit, which Uber may never even make anyway. Although Facedrive offers competitive journey fares, riders do not pay a premium for CO2 emissions offsetting while drivers do not lose any of their fares to pay for the green initiative.
Facedrive's green strategy is simple yet highly effective and cheaper than fancier solutions being adopted by some so-called big companies. Carbon-neutral ride-sharing ticks every box with the new kings of Wall Street.
#2 Revenue from Multiple Angles
But this is about short term and long term … and now that we've seen the tech Facedrive can develop, watch it also capture the explosive food delivery industry by applying its new business model to absolutely every rider-relationship revenue stream it can think of.
Facedrive isn't just challenging Uber in the ride-sharing space. It's now challenging it in the food delivery space, as well. And it's going for full-on involvement.
Kicking off its aggressive expansion drive in the food delivery segment, Facedrive entered into a binding term sheet to acquire the assets of Foodora Canada, a subsidiary of the $20-billion multinational food delivery service Delivery Hero, which operates in over 40 countries and services more than 500,000 restaurants.
Facedrive's acquisition of the Foodora Canada food delivery business will give it hundreds of thousands of customer names and over 5,500 new restaurant partners for just a part of the high-tech mobility company's revenue-generating ecosystem. Worth $24 billion already in 2018 and set to top $98 billion by 2027, the global food delivery market is now officially at war. And it's a war even more ferocious than streaming.
While Uber is prepared to pay a premium for the Grubhub--the delivery service with the biggest US market share--Facedrive (FD.V,FDVRF), the new face of "sharing", is cutting a food delivery acquisition deal for what looks like pennies on the dollar.
The winner of this war will be the new sharing business model that defies the out-of-control cash burn, broadens the revenue potential and wins the hearts and minds of every stakeholder in the chain, including drivers and restaurants.
This new acquisition should give Facedrive a huge revenue boost, challenging struggling competitors such as Uber Eats and Skip The Dishes. Overnight, Facedrive is set to position itself into the top echelon of Canadian food delivery services. Then targeting global expansion.
#3 The New Silicon Valley
Facedrive is one of the biggest things to emerge from Ontario's 'Technology Triangle', also called "Waterloo". It's not only Canada's answer to Silicon Valley, but it's also fast growing as a startup tech hub.
The deal timeline has been so fast-paced that's it's hard to keep up:
- First, in April, it acquired HiRide--another 'Technology Triangle' innovator that came out of Ontario's version of "Shark Tank", "Dragon's Den", giving Facedrive access to the entire user base of a unique long-distance car-pooling solution for students and professionals. For its expansion plans, that gives Facedrive the first mile, last mile and … long mile.
- Over the next two months, without missing a beat, it launched a string of new revenue-generating services from Facedrive Foods and Facedrive Health to COVID-19 TraceScan, and even its own exclusive line of Bel-Air clothing co-branded with Will Smith.
- Then in early May, it landed a deal with the North American labor union to use TraceScan …
- Days later, it announced plans to acquire Foodora Canada from Delivery Hero in a deal that solidifies the launch of Facedrive Foods … with a bang.
- Launched Marketplace with Westbrook
What we have is a potential challenger to the shared mobility throne, in more ways than one. It's exactly the sustainability that Big Money is looking for --and while some may be sleeping while Facedrive prepares for global expansion, others are very awake.
**IMPORTANT! BY READING OUR CONTENT YOU EXPLICITLY AGREE TO THE FOLLOWING. PLEASE READ CAREFULLY**
This publication contains forward-looking information which is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ from those projected in the forward-looking statements. Forward looking statements in this publication include that the demand for TaaS and ride sharing services will grow, and transportation as a service industry will reach $8 trillion; that the demand for environmentally conscientious ride sharing services companies in particular will grow quickly and take a much larger share of the market; that Facedrive's marketplace will offer many more sustainable goods and services, and grow revenues outside of ride-sharing; that new products co-branded by Bel Air and Facedrive will continue to sell well; that Facedrive can achieve its environmental goals without sacrificing profit; that Facedrive Foods will expand to other regions outside southern Ontario soon and will close its purchase of Foodora; that Facedrive will be able to fund its capital requirements in the near term and long term; and that Facedrive will be able to carry out its business plans. These forward-looking statements are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. Risks that could change or prevent these statements from coming to fruition include changing governmental laws and policies; the company's ability to obtain and retain necessary licensing in each geographical area in which it operates; the success of the company's expansion activities and whether markets justify additional expansion; the ability of the company to attract a sufficient number of drivers to meet the demands of customer riders; the ability of the company to attract drivers who have electric vehicles and hybrid cars; the ability of Facedrive to attract providers of good and services for partnerships on terms acceptable to both parties, and on profitable terms for Facedrive; that the products co-branded by Facedrive may not be as merchantable as expected; that Facedrive does not close the purchase of Foodora and even if it does, the purchase does not bring the customers, partnerships or revenues expected; the ability of the company to keep operating costs and customer charges competitive with other ride-hailing companies; and the company's ability to continue agreements on affordable terms with existing or new tree planting enterprises in order to retain profits. The forward-looking information contained herein is given as of the date hereof and we assume no responsibility to update or revise such information to reflect new events or circumstances, except as required by law.
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