It’s a truism that startups burn through money like bonfires burn through tinder. But nine years in after becoming a worldwide company, Uber is still burning cash—$1 billion in the most recent quarter and $4.5 billion altogether in 2017.
To understand how Uber continues to enchant the investment and tech worlds despite its miserable financial record requires a little background. The dominant metaphor in the tech world is Moore’s Law. Moore’s Law is named for Gordon Moore, a semiconductor pioneer, who noted the doubling of transistors on an integrated circuit about every two years. This rapid progress led to rapid increases in the capabilities of computers in terms of speed, memory and computational power even while prices were coming down dramatically. That progress is also seen in the capabilities of practically everything containing circuits including cellphones, cameras and other digital devices.
As Wikipedia will tell you, Moore’s Law is not a law of physics; it is simply an observation about an historical trend in the semiconductor industry. But so pervasive has been the effect of Moore’s Law on the digitization of our daily lives—for instance, our cellphones have become powerful, portable miniature networked computers with cameras—that we are inclined to believe that Moore’s Law is a kind of mystical force unleashed by the tech industry on modern society.
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