These are not VC-backed startups with a hundred employees. They&#x27;re small businesses with high capital costs, high labor costs, high operational costs (fuel), and high liability costs. A single cab might bring in 100k gross, and a fleet of 100 might be 10m gross. Even assuming a generous 20% operating margin, that&#x27;s $2 million left to play with. In Q2 &#x27;14, Uber was spending around $50 million, annualized, on R&amp;D, and has grown immensely since then.<p>Even developing a relatively simple app (but one reliable enough to be trusted with handling fares), would be out of reach of all but the largest cab companies. Developing the infrastructure to calculate surge pricing, connect drivers with nearby fares, etc, would be completely impossible.