Leaked Documents Show Uber’s Cost Structure, Best-Performing Cities

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FOXBusiness.com has obtained leaked documents that Uber is using to persuade investors to participate in its Uber China financing.  The global ride-sharing company is close to finalizing a round of at least $1 billion that would value Uber China at more than $7 billion, according to a source with direct knowledge of the matter.

FOXBusiness.com has also learned that the company is telling potential investors that Uber China will be spun off as a separate business that could IPO before Uber.

The documents show that Uber’s “net present value,” a projection of cash flows, is $4.9 billion in Shanghai, $2.2 billion in Guangzhou and $1.8 billion in Shenzhen.

While Uber is the dominant car service app in the United States, it has a lesser market share in China, due to competition from services like Didi Kuadi.

Uber is also showcasing its “contribution margin” in various cities, a measurement of profitability that excludes variable costs. The company’s “contribution margin” is at 11.1% in Stockholm and Johannesburg and 10.1% in San Francisco. Other top cities include London, Charleston, Melbourne, Washington DC and New York. The breakdown shows that Uber pays roughly 80% of what it generates from gross bookings in driver commissions.

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Uber is the world’s most valuable startup with a $50 billion valuation. Its long list of investors include Google Ventures, Blackrock and Goldman Sachs.

Uber declined to comment.

Below are the specific data points obtained by FOXBusiness.com and given to the company’s investors.

Document 1: City Profitability (Mar-2015)

Selected Cities                            Contribution Margin

Stockholm                                                  11.1%

Johannesburg                                              11.1%

San Francisco                                             10.1%

London                                                        9.7%

Charleston                                                   9.5%

Melbourne                                                   9.3%

Washington DC                                           9.3%

New York                                                    9.2%

Boston                                                         9.1%

Paris                                                            8.7%

Chicago                                                       7.0%

Sydney                                                        6.4%

Atlanta                                                         5.4%

Mexico City                                                 4.9%

Miami                                                          4.4%

Baltimore                                                     4.1%

Minneapolis                                                 4.1%

Houston                                                       4.1%

Phoenix                                                       3.8%

Seattle                                                         3.5%

Note: margins adjusted for uberPOOL promotions

Document 2: Selected City NPVs

Selected City NPVs (net present value)

Shanghai

NPV: $4.9bn

Guangzhou

NPV: $2.2bn

Shenzhen

NPV: $1.8bn

Document 3: City Contribution Margins

San Francisco         Today

Gross Bookings       100%

Driver Commission    (78.1)%

Safe Rides Fee          5.0%

Driver Incentives        (1.4%)

Returns                    (0.4%)

Net Revenue           25.1%

 

Payment Fees           (2.4)%

Mobile (Net)               (0.2)%

Network                    (0.3)%

Other COGS             (1.9)%

Sales & Marketing     (2.9)%

Insurance                 (3.5)%

Other Opex               (3.8)%

 

Contribution Margin    10.1%

London                    Today

Gross Bookings       100%

Driver Commission    (80.0)%

Safe Rides Fee          0.0%

Driver Incentives       (1.6%)

Returns                    (0.8%)

Net Revenue            (17.6%)

Payment Fees           (1.5) %

Mobile (Net)               (1.0) %

Network                    (0.2)%

Other COGS             (0.6)%

Sales & Marketing     (3.5)%

Insurance                  (0)%

Other Opex               (1.1)%

 

Contribution Margin 9.7%

Shanghai                 Launch

Gross Bookings       100%

Driver Commission    (80.0)%

Safe Rides Fee          0.0%

Driver Incentives       (138.8)%

Returns                    (0.3%)

Net Revenue            (119.2%)

 

Payment Fees           (1.0) %

Mobile (Net)               (5.6) %

Network                    (0.8)%

Other COGS             (1.2)%

Sales & Marketing     (15.3)%

Insurance                  (7.0)%

Other Opex               (7.6)%

Contribution Margin (157.6%)

Follow Katie Roof on Twitter @Katie_Roof

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