Sign up for our daily briefing

Make your busy days simpler with the Axios AM and PM newsletters. Catch up on what's new and why it matters in just 5 minutes.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on the day's biggest business stories

Subscribe to the Axios Closer newsletter for insights into the day’s business news and trends and why they matter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sign up for Axios Pro Rata

Dive into the world of dealmakers across VC, PE and M&A with Axios Pro Rata. Delivered daily to your inbox by Dan Primack and Kia Kokalitcheva.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sports news worthy of your time

Binge on the stats and stories that drive the sports world with the Axios Sports newsletter. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tech news worthy of your time

Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Get the inside stories

Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Denver news?

Get a daily digest of the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Des Moines news?

Get a daily digest of the most important stories affecting your hometown with the Axios Des Moines newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Twin Cities news?

Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Tampa Bay news?

Get a daily digest of the most important stories affecting your hometown with the Axios Tampa Bay newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Charlotte news?

Get a daily digest of the most important stories affecting your hometown with Axios Charlotte

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Nashville news?

Get a daily digest of the most important stories affecting your hometown with the Axios Nashville newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Columbus news?

Get a daily digest of the most important stories affecting your hometown with the Axios Columbus newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Dallas news?

Get a daily digest of the most important stories affecting your hometown with the Axios Dallas newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Austin news?

Get a daily digest of the most important stories affecting your hometown with the Axios Austin newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Atlanta news?

Get a daily digest of the most important stories affecting your hometown with the Axios Atlanta newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Philadelphia news?

Get a daily digest of the most important stories affecting your hometown with the Axios Philadelphia newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Chicago news?

Get a daily digest of the most important stories affecting your hometown with the Axios Chicago newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sign up for Axios NW Arkansas

Stay up-to-date on the most important and interesting stories affecting NW Arkansas, authored by local reporters

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top DC news?

Get a daily digest of the most important stories affecting your hometown with the Axios DC newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Illustration: Sarah Grillo/Axios

Ride-hailing service The Drivers Cooperative recently debuted in New York City, claiming that its lack of VC funding would result in better driver pay and lower passenger costs.

Why it matters: TDC’s approach is a direct rebuke to the venture capital-fueled gig economy model.

Details: The organization is incorporated as a “worker cooperative corporation” and currently lets every signed-up driver enroll as a member of the co-op, which means receiving one share in the company and one shareholder vote.

  • The co-op takes a 15% cut of rides (compared to Uber and Lyft’s roughly 20%) to fund its operations, and any leftovers at the end of the year will go back to drivers via profit-sharing.
  • The company says its drivers currently make on average about 30% more than they would driving for Uber or Lyft, and that riders pay slightly less.

The big picture: A number of companies have tried (and often failed) to reform the model popularized by Uber and Lyft, including:

  • Juno: The NYC-born startup promised it would give drivers equity in its company. It eventually sold to U.K.-based Gett and backtracked on its equity promise because regulators wouldn’t allow it.
  • Austin’s indies: A crop of upstarts, including a nonprofit and a Facebook group matching drivers and riders, emerged in Austin a few years ago when Uber and Lyft ceased operating for a year.
  • Dumpling: The startup, which charges drivers a monthly fee for using its app instead of taking a cut from each transaction, recently expanded into ride-hailing after getting its start in grocery delivery. Unfortunately, it’s reportedly also run afoul of some workers with changes made to its apps.

Between the lines: “We’re actually selling things for the price that they cost,” says TDC co-founder Erik Forman, adding that Uber and Lyft’s lack of profits are a sign that their approach isn’t actually working.

  • The argument for the venture-backed model has been that it takes a lot of upfront capital to set up operations and grow very quickly to capture market share and compete with rivals.
  • That’s also meant price wars on all fronts — including price cuts for riders and earnings bumps for drivers — which has mostly been financed by venture capital for the first several years of a company’s life.
  • TDC has only raised about $300,000 via mostly debt and is preparing to raise just over $1 million.

And it’s not the only one to take this approach. Driver’s Seat, an app for drivers to collect and analyze data about their hours and earnings, is also set up as a cooperative. While free for drivers, it sells access to aggregate data and insights to municipalities.

  • Co-founder Hays Witt says the aim is to give drivers back some ownership and control over their work data.

Yes, but: It remains to be seen how a smaller, local upstart can fare in the face of multibillion-dollar public companies that are already household names.

  • While its brand can certainly appeal to many drivers’ and passengers’ sense of using a more “ethical” service, some will undoubtedly prefer convenience or sticking with the familiar.
  • And while Forman sees the technology as a commodity, companies like Uber and Lyft spend tremendous resources on developing, maintaining and fine-tuning their apps to keep drivers and riders happy.

The bottom line: Uber and Lyft proved there’s a market for smartphone-enabled urban transportation — but the quest to meet that demand via a radically different approach to business is ongoing.

Go deeper

Denver's gridlock is down during the pandemic, but only a bit

Expand chart

Denver ranked as the 16th most-congested city in the U.S. in 2020, five spots worse than a year ago.

By the numbers: A new scorecard from traffic analytics firm INRIX found drivers lost 24 hours to congestion.

Updated 2 hours ago - Politics & Policy

Omicron dashboard

Illustration: Brendan Lynch/Axios

  1. Health: Pfizer and Moderna boosters overwhelmingly prevent Omicron hospitalizations, CDC finds — Omicron pushes COVID deaths toward 2,000 per day — The pandemic-proof health care giant.
  2. Vaccines: The case for Operation Warp Speed 2.0 — Starbucks drops worker vaccine or test requirement after SCOTUS ruling — Kids' COVID vaccination rates are particularly low in rural America.
  3. Politics: Biden concedes U.S. should have done more testing — Arizona says it "will not be intimidated" by Biden on anti-mask school policies — Federal judge blocks Biden's vaccine mandate for federal workers.
  4. World: American Airlines flight to London forced to turn around over mask dispute — WHO: COVID health emergency could end this year — Greece imposes vaccine mandate for people 60 and older — Austria approves COVID vaccine mandate for adults.
  5. Variant tracker

Arizona governor sues Biden administration over COVID funds tied to mandates

A teacher prepares a hallway barrier to help students maintain social distancing at John B. Wright Elementary School in Tucson, Arizona, on Aug. 14, 2020. Photo: Cheney Orr/Bloomberg via Getty Images

Arizona Gov. Doug Ducey (R) filed a lawsuit Friday against the Biden administration for ordering the state to stop allocating federal COVID relief funds to schools that don't comply with public health recommendations such as masking, the Arizona Republic reports.

Why it matters: The Treasury Department said last week that the state would have to pay back the money if Ducey does not redesignate the $173 million programs to ensure they don't "undermine efforts to stop the spread of COVID-19."