How Much Does it Cost to Build an Uber-Like Application?
Maybe you run a business, and you’re wondering if you can share of Uber’s success. I’m going to go through the process of building an Uber-like application, and how much you can expect to pay.
Firstly… How Much Did the Uber App Development Cost?
Uber connects drivers with passengers – taking advantage of technologies like smartphones, GPS Navigation, and mobile internet to make it happen.
This simple idea has had a dramatic impact on the world. As with every innovation, the change has been great for some and painful for others. For licensed taxi drivers, Uber is a threat to their traditional livelihood. But for tens of thousands of Uber drivers, it‘s a whole new source of income. And for riders, it‘s a chance to save money on rides.
Uber launched in 2011, and by that time they had raised about $1.5 million in funding. So we can assume that their MVP costs about $1-1.5 million to develop. Since then the company has raised over $15 billion. Yes, billion.
That might seem huge for an app, but most of this money has been spent solving massive problems with regulation, lawsuits, and global expansion. Around every corner and in every city Uber has faced huge opposition from governments, institutions, and sections of the public.
How Can You Possibly Compete With That?
The good news is that you don‘t have to compete in the same way. The hard work has already been done for you. Uber and other startups have already pushed through a lot of the regulations, and apps are a lot easier to build now than when Uber started coding in 2009. If you decide to create an app like Uber, you have the opportunity to learn from their mistakes.
Of course, going head-to-head with the likes of Uber and Lyft would still be a major challenge. Uber is a great global service – you can hop on a plane and get an Uber from the airport in most major cities. They have a market-leader advantage in the general market.
But there are other opportunities where you can carve out a very profitable niche.
If you are thinking about taxi booking app development, you are more likely to succeed if you narrow down and find a niche you can dominate. Let‘s look at an example.
Yandex is the largest Russian internet search company. It‘s bigger than Google in Russia, so it‘s used to competing with Silicon Valley giants. It also has owns a taxi app development company – Yandex Taxi – which dominates the Russian market. Right now it has more than double the market share of Uber.
How did they do it?
A few years ago, the Russian taxi market suffered from major problems. The best way to get a cab was to hail one illegally from the street. Yandex Taxi attacked this opening in a different way to Uber. Rather than hiring drivers as contractors, they partnered with independent taxi companies. This gave them fast access to thousands of drivers and cars that were compliant with all local regulations.
Lack of familiarity with the local market, laws, and demand meant that Uber didn‘t win the top spot in this instance. The way we think about transport is changing rapidly, and there will be many more stories like this to come.
How Your Business Can Benefit
Uber works because it improves efficiency. Users aren‘t standing in the rain waiting for a cab that could be just around the corner, and drivers aren‘t missing close fares because they can‘t find them.
You can use the same technique to improve your business by putting empty car seats or trunk space to good use. By automating logistics like this you‘ll be able to
- Cut costs
- Deliver faster, more customized service
- Attract and retain clients
- Make life easier for yourself!
In a fast-changing market, you need to be active to maintain an edge over your competitors. Using this kind of tech, you may well be able to improve your services and even expand into new ones.
So What Exactly is an ’Uber-Like‘ Application?
Uber is actually made up of two mobile applications. Let‘s take a look at what each needs to do.
- Signup / login to rider account
- Send a ride request with the current location and final destination
- Signup / login to driver account
- Receive ride requests
- Accept or decline a ride request
- Navigate to pick up / drop off locations
- Start and end trips
Then you have an additional part like
- A server that takes in requests from riders, sends them to the closest available driver
- Payment processing
- Contact between driver and rider
If you have used Uber, you will know that there are other great features, too. Things like surge pricing, rider and driver feedback, etc. You will need to work out which of these features are required by your app. Check out our great article on 6 tips to write a good project specification.
For this article, let‘s assume you just need an Uber-like application with minimal features.
How to Build a Mobile Taxi App
Here is where things get interesting. Once you‘ve decided on the features you require, you need to start building. Technology trends move fast and you don‘t have time to wait around for a year looking at different solutions.
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Firstly, which platform do you start building on – iOS or Android? This will depend on many factors. To help decide if you want to start building for iPhone, Android, or a cross-platform hybrid, check out our more in-depth article here.
Next, you will need to hire taxi app developers. Your main options are
- Freelance developers
- Hiring an In-house team
All have their upsides and downsides. A freelancer will probably quote the lowest price to develop an Uber-like application but also comes with the lowest quality and greatest risk of failure. One low-hourly-rate developer is not enough to build a robust app with a great user experience.
So you will need a team. Decide whether you want to use an in-house team or outsource the whole project, and then you can begin. Unless you have the team already, it will be easier, less risky and probably cheaper to go with a great agency that has tackled this sort of problem before.
Using an agency that has multiple teams will be the best option from a security standpoint. Tight security requires good planning, coding, testing and maintenance on all levels. This is difficult for an individual or a small team. Having a large base of skilled developers to critique each other’s work is invaluable.
The wonders of geo-arbitrage let you take advantage of the fact that there are plenty of talented developers in countries where wages are relatively low. Finding an agency that can help you take advantage of this is where you should start.
How much does it cost to make an Uber-like application?
- To build the technology? – Probably less than you think
- To make a great user experience? – Probably more than you think
A good developer can recreate Twitter in less than a day – I‘ve even done it before. But, if the guys at Twitter had stopped iterating and improving their product after one day, it would never have been successful. Getting the technology and functionality right is one thing – but designing a great UX/UI is another thing.
- “You need more than a DJ, a dance floor and a few bottles of alcohol, you have to ensure that the right people come in at the right time, and you have the right decor, ambiance, and music. And of course, the cocktails.”
Another huge variable is the scale. Running a taxi-service mobile app in your local neighborhood with a few hundred users is relatively easy. When you start scaling up to the national and international scale, things get expensive. At this point, the entire infrastructure of your application will have to be redesigned, and your budget will likely go into hundreds of thousands or even millions of dollars.
We will assume that you aren‘t going to build it on this scale – not just yet anyway.
So the answer? I would say you could make a minimal version of an Uber-like app under $50,000, but you could spend anywhere up to $500,000 for an amazing user experience.
Innovate… Or Fail!
Uberization is a name for the shifting business model we see in a lot of industries now. Taxi services, food delivery, and accommodation are all being changed by our new intimately connected way of life.
Transport businesses that fought this changed paid a huge price. Technology has been transforming industries for millennia, and every time it does there are winners and losers. Winners adapt quickly and use new tools to expand and profit. Losers desperately cling to old structures and methods that will inevitably fail.
We‘ve seen it can be expensive to build an Uber-like application, but it could be far more costly not to. Whether you like it or not your industry is changing, and you need to choose which side of the change to be on.