Despite a 100% growth in job postings this year.
On a tangential note: I am told that Uber is "advertising like mad" for drivers, apparently there is some turnover.This article originally appeared in Term Sheet, Fortune’s newsletter on deals and venture capital. Sign up here.On-demand startups—the ones bringing us grocery, housecleaning, parking, lawn mowing, and personal butlers with a tap on our smartphones—have been out of vogue with venture investors for most of this year. When Postmates raised $140 million at a flat valuation, the company made sure to telegraph what a “super, super difficult” time it had finding willing investors.
Part of that is over-saturation. We don’t need eight separate apps just to deliver pizza. (And as we now know, venture investors are all about the pizza restaurant chains these days, not the pizza delivery apps.)
But mostly, the struggle is because the business model is tougher than many initially thought. To use two startup clichés at once, there is no making it up on volume for companies handing out dollars for 85 cents. In March, I wrote that things are getting real for on-demand startups, comparing this class of companies to Wile E. Coyote, moments before he hurls himself off a cliff.
But the entire category hasn’t collapsed yet and there’s evidence of a sustainable future....MORE