Say hello to the marriage of digital advertising and ride-hailing – and, it seems, more potential for a bigger payday for those gig workers who provide that form of transportation.
A company called Firefly reportedly has raised $30 million in a Series A round, bringing its total funding to $51.5 million. According to that report, the company “works directly with ride-hailing drivers to mount ad displays on top of their cars. It launched out of beta in December 2018, and in the intervening months, it’s garnered support from brands like Brex, Segment, Caviar, Zumper and others.”
The Firefly proposition seems well-suited to the digital age, the rise of the gig economy and the emergence of the connected vehicle ecosystem. As the report notes, “Firefly’s digital screens, which display geotargeted ads for national and regional brands based on driver routes, area demographics and traffic patterns, tap into the fast-growing global out-of-home ad market. Firefly’s screens earn the average driver an additional $300 per month, the company claims, or roughly 20 percent more profit.”
The report added that the Firefly network “gets 200 million impressions per month across 40,000 square miles of coverage, with over 650,000 hours of content played to date.”
Payments and income for gig workers are coming under increased focus, as the PYMNTS Gig Economy Index has documented. In Q3 2018, 35.6 percent of respondents said they participated in the gig economy, the highest number since Q3 2016. Reasons given for participating shifted throughout 2018. Fewer in Q4 2018 reported saving for life events (22.9 percent) than in Q1 2018 (27.0 percent). Though flexibility was the top motivation in all quarters, that factor also shrunk throughout the year, from 42.0 percent in Q1 to 38.4 percent in Q4.
Over one-quarter (26.8 percent) of workers who sourced gigs through digital marketplaces were paid instantly, compared to 22.3 percent who got gigs through other means. This correlates to the majority (51.3 percent) of digital marketplace gigs paying via PayPal. Direct deposits are also instant, but aren’t typical of gig economy jobs and are more common with W-2 income, which is likely why gigs not sourced on digital marketplaces were likelier to use direct deposit.
Gig workers (all workers, actually) want to get paid more quickly. According to PYMNTS, 75 percent of overall consumers prefer faster payments. This is even more important in the gig economy, where 85 percent of respondents said they would work more often if they could get paid faster. Workers ages 25 to 34 were most likely to be paid via direct deposit, while more than half of those under 25 (52.9 percent) were paid through PayPal. At the other extreme, 44.4 percent of gig workers aged 65 and older were paid via paper checks in Q4 2018.
As for the pay of rideshare driving, an MIT survey (which has reportedly been disputed by Uber) found that the average median pretax profit for Uber and Lyft drivers stood at $3.37 per hour. According to the report, “A Buzzfeed survey found that Uber drivers in Denver, Detroit and Houston earned just $13.25 an hour on average.”
Uber and Lyft, of course, have recently launched their initial public offerings, and both companies are trying to ease the concerns of investors who are worried about ongoing losses. Both ridesharing companies have dealt with some losses as they have tried to lure customers to their respective platforms. In the last quarter, Uber saw a net loss of around $1.01 billion, while Lyft’s adjusted per-share loss was $9.02. In an earnings call on Friday (May 31), Uber CEO Dara Khosrowshahi said the company was optimistic about the ridesharing market and the competition within it. Lyft shares rose following the news, according to a report by CNBC.
Clearly, the ridesharing ecosystem still has much room to develop. It’s all but certain that issues related to driver pay will help guide ecosystem growth.