It is hard not to know what Uber or Lyft are considering that traditional taxis seem to be declining since the last few years due to the use of these apps in the market.
We weren’t fans of using the very popular Uber and then Lyft in the beginning. Still, when we noticed how comfortable it could be and the sense of safety it adds every time we take a short trip in the city, we started to appreciate their existence a bit more.
Now, what does this have to do with side hustles and making money? Aren’t you supposed to pay for the service?
In case you aren’t too well-versed with any of these apps, they are so popular because they also brought a new opportunity for people to make either extra cash during their free time or enjoy this working source without many requirements that limit them, like experience, for example.
To this date, Uber and Lyft are more known for the number of people making money with them than those who use any of the apps, and if you have a car and some free time, you could enjoy this side hustle to have some cash to save or finance a few expenses.
But what does it take to drive for any of them? Is it difficult to meet the requirements? What about the money you can earn in a month?
We will be discussing all these aspects to help you decide whether this is something you can start, or maybe it is time to find another side hustle for your goals.
What Is Uber? – Its History & How It Works
First, the important part: Are you truly aware of what both of them are?
It is very basic to say they are just apps you can use to access transport and provide certain reliability. After all, many of them are available today.
Thus, we will be diving into the details and history of each of the companies but since this can take a while (and we highly recommend you invest a few minutes in reading it), starting with Uber alone seems like the best idea.
Uber doesn’t really need a presentation as a transportation company that offers a ride-hailing taxi service that works around an app designed by the founders and assigned developers.
Pickup locations on Uber’s journey began in 2009 when Travis Kalanick and Garrett Camp founded UberCab, the first version of the popular app.
The company received $200.000 in seed funding in 2009 and an additional $1.25 million in 2010.
However, it wasn’t until 2011 when Uber was officially launched in San Francisco following a beta release in 2010, and by the end of the year of its release, Uber had raised $44.5 million in funding.
Although the official launch took place in San Francisco, it expanded to new US cities every month starting in May 2011.
Its first international launch took place in Paris during the same year, and it was quickly followed by Toronto, London, Sydney, and Johannesburg.
As of this date, when we are writing this, Uber is available in more than 60 countries, including a total of 5.000+ cities worldwide.
Initially, the app and service were popular. However, technology’s popularity and proving its reliability made the company grow over the last five years.
Since Uber relies on smartphone software and app software, the boost in both types of technology just brought more revenue to the service.
Now, how does it work? Simply put, you download the Uber app to your smartphone and set a pickup point and destination on a map. Then tap to request an Uber driver that will go to your location.
You can track where your driver is, and you will receive a notification once he or she is right in front of your door or close by.
There are a variety of cars to choose from, including luxury and standard. The driver’s name, number plate, and car are visible while driving, so you can know who to expect before your trip.
The app’s GPS and map capabilities not only allow you to track distance and where the person is. You can also estimate the fare and be ready to know how much you will have to pay.
One of the main benefits of Uber that also brought more popularity is the fact that you don’t need cash to pay for the trip.
Instead, debit and credit cards are used for payments, and some digital options like digital wallets are being added.
Other features include the ability to split fares with friends, connect your smartphone’s music playlist to the driver’s car stereos, and share your route with your family and friends, so they know where you are and you can feel safer during your trip.
What About Lyft? – Inception & Operations
Lyft follows the same principle of being a transportation company like Uber. Believe it or not, it is based in San Francisco, right where Uber started to operate during its initial launch.
This ridesharing service that is based in San Francisco was founded by John Zimmer and Logan Green in June 2012 and is a direct competitor of Uber since it isn’t only similar but was also created with the same concept and idea in mind.
Therefore, yes, Lyft is another mobile app that allows peer-to-peer ridesharing, and it connects passengers in need of a ride with drivers who own a car that is signed up for the drivers’ program and is part of the company as independent “Lyfters.”
The main difference with Uber is the current locations where you can find Lyft and access its drivers.
Unlike the first ridesharing app we mentioned, Lyft is only present in the USA. Although it covers about 400 cities in the country, it hasn’t made a very direct launch internationally except for Canada. The company even claims it is its only international market as it operates in Toronto and Ottawa with some expansions in other cities like Vancouver.
Just like Uber, Lyft requires that riders download the Lyft app to their iOS and Android-based phones, enter a valid number, and provide payment details.
The main information you will need to provide is your default address, full name, create a username and password, and include a photo if possible.
One of the benefits of Lyft is that you can also use your computer to reserve a drive in case you have difficulties with your phone.
That being said, requesting a ride is quite simple as the app detects your location, you choose a Lyft ride option, and the estimated cost for your trip is estimated when you add your destination.
Just like Uber, you’re also provided with the driver’s information, and you can track the current location and wait until you are notified that he or she is right there to pick you up.
How to Get Started? Uber & Lyft Requirements
This side hustle is all about becoming a driver for any of the apps, and if you ask us which one we recommend, you will need to wait a bit longer for our verdict.
First, we want to focus on how you can get started and what you will need to comply with in order to be selected as part of the team.
Although the requirements are quite similar for each service, they vary in certain aspects. Thus, we will have to go over each of them separately.
In the case of Uber, we will leave you a list of the main requirements you must meet:
- Minimum age requirement for driving in your country.
- All valid and needed documentation to drive in your country.
- Proof of residency in your city and area.
- A driver profile photo that must look like your ID (no selfie, don’t use sunglasses, and the usual standards). Notice you cannot use your ID or driver’s license photo. It must be a new one.
- Complete a screening online to review your driving record and criminal history.
- You must keep your driver’s license, vehicle registration, proof of insurance, and SSC (Safety Standards Certificate) inside your car + Uber stickers placed on your vehicle.
Other requirements can apply based on your city and the regulations for vehicles in it.
This means you will usually have to meet certain regulations and standards for the vehicle you will drive, which usually limits most people to join Uber.
However, it is basically having all your documentation to date, maintain your vehicle properly, and perform regular maintenance to offer the best services and safety.
With Uber done, we can move on with the requirements you need to meet with Lyft.
In the case of this service, you will be meeting the USA regulations and consider those from your state, county, and city in specific.
However, unlike Uber, it comes with more specific requirements:
- You must be at least 21 years old. This can change to 25 minimum, depending on where you live.
- Valid and updated driver’s license.
- Go through a background check and a DMV check. Those processes consider your criminal records or violent events as well as recent driving issues. Of course, you must pass them.
- Valid license plates with proper registration and valid auto insurance with your name in the policy. Insurances with third parties are not allowed.
- Complete the service’s community safety education program.
- The smartphone is a must (for Uber as well).
Regarding your car, Lyft sets standard requirements for its possible drivers, but additionally, you must meet certain regulations you will be mentioned when applying for the position.
In the case of general vehicle requirements, it cannot be a taxi, limo, or any subcompact car regardless of the brand as long as the model goes according to this category.
Some conditions like the year of the car can apply depending on your state and city. For most people, the vehicle must be from 2007 or newer.
It cannot be a two-door car since only four-door vehicles are allowed and must have five seat belts corresponding to the number of seats.
It must be new in terms of not being refurbished, rebuilt, repaired greatly, but rather be in good shape.
How Much Can You Earn with Uber?
After all the details of how you can join and the fact you will be working as a driver, you must be wondering: How much can someone earn with this side hustle?
To answer that question, it is important to understand how Uber calculates payments and consider the fees you have to pay for using the service and being a member.
Payments are calculated differently depending on which service you use. The amount you end up with will depend on your location, how frequently you drive it, and when (time).
That being said, Uber calculates the cost of a ride based on the booking fee. This fee is the amount paid by the rider for regulatory, safety, and operational costs.
The service fee funds payment processing, app development, and customer support. There are many other factors that Uber considers when calculating payments for rides.
The surge, for example, is also considered. The heat map shows you where Uber drivers are most in demand.
Surge allows you to see the location on the heat map. This will allow you to make more money than your standard fare.
The standard trip fare, which is how far and how long you drive, is also taken into account. The earnings on long-distance pickups and minimums for short trips are also included in the calculations.
What happens with a fee from a ride that has been canceled? Then, you will receive additional payment for this cancellation. There’s no need for you to pay the fee.
Continuing with the fees and commissions, you must be aware that they aren’t actually that hard to understand.
The passengers pay a booking fee and a per-minute or mile fee. As a driver, you would get the majority of the fare as Uber will discount part of the service fee mentioned above.
Uber claims that it charges 25% to its drivers, but in reality, it takes slightly more from their earnings. This is because rideshare companies take additional fees, which results in a higher percentage of the cut.
Today, a driver would make about $10 if they drive around 4.71 miles.
Uber rides are subject to a booking fee and safe ride fee. These fees range from $1 to $3 or more like corresponding to each respectively.
These fees can vary depending on where you live, and you won’t notice them being discounted as Uber will directly manage them.
Finally, Uber will take a higher commission if the ride fare costs are lower. The commission can go up to 42.75%, although the company continues to claim it only takes 25% (fixed).
Well, enough of fees and commissions, let’s focus on the earnings. How much can you truly earn with Uber?
This will depend a lot on the country and city you are driving in. However, an average has been set for the USA in which drivers earn about $21.90 per hour, and if you take this into the regular and simple math by working around 20 hours a week, that could be easily around $439.
However, some bonuses are also included based on some milestones you achieve. With the current competitive market for Uber drivers, you need to consider the specific state and distances.
For most cities in the USA where people use the app the most, the earnings per hour for you can reach $15+.
Based on a $17 average, which is the usual cost per hour for drivers in the main cities in the USA, you could easily earn about $186.000 annually when working 30 hours a week.
Inside Lyft: Commissions, Rates & Earnings
Uber? Check. It is time for Lyft to shine, or maybe be outshined by Uber? That’s something you will judge by yourself.
The earning system in terms of salaries per hour is very similar to Uber. In fact, the average also hits the $17+ mark but doesn’t go as high as $21 during the first example for Uber.
But before going there again, let’s focus on the fees and commissions.
Lyft also works around a 25% commission from fares, but just like Uber, this could increase based on the passenger’s total cost of the ride.
It isn’t too hard to go over the details for this app since they are way too similar to Uber, and when it comes to income, it is possible to make the same amount annually or a bit less depending on the hours you work and routes you cover as well.
That being said, this service calculates earnings based on a base fare, time, and distance as well, and tips and bonuses are available for drivers.
The tips passengers leave are completely yours, and there’s no need to pay commissions for them.
Finally, Lyft goes around subregion rates that can be applied based on your location.
It is also crucial to look at the payment methods Lyft offers to both passengers and drivers to determine the best option to avoid the most commissions.
Joining & Costs: Do You Need to Invest?
One of the benefits of working with any of these platforms and services is that you don’t need to pay a membership or anything similar.
Once you have met all the requirements and are able to start working after being certified, you just need to handle the regular fees and commissions.
This means your application is “free” in terms of what you need to pay to the company.
However, the real expenses start when you need to improve your vehicle to work with them.
Any vehicle will go under inspection before you are allowed to work, and if there is something that doesn’t meet the standards, you will have to repair it or enhance the vehicle, which leads to money you need to invest.
We cannot come up with a specific amount of money you might need to invest since everything depends on the status of your vehicle.
However, most Uber and Lyft drivers decide to spend about $300 to retouch the painting or maybe perform regular maintenance before or after the inspection.
Of course, if your vehicle is in great shape, there’s no need for such a thing.
Which One Is Better? – Uber or Lyft?
And here’s when to start the big discussion: Which one should you drive for?
In our opinion, both are great alternatives as side hustles since they are basically the same in terms of hourly rates and fees.
However, some find that Uber is better due to its reputation and how many people use it over Lyft.
If we have to point out, Uber’s main benefit over Lyft is that it is international, not local.
This means that if you aren’t in the USA, you will need to use Uber no matter what, but when you are in the country, both will be available.
If we have to base this recommendation and answer on our experience, we would mention Uber over Lyft, mostly because it is simpler in the long term and allows you to access more passengers in any city it is available for.
But if you feel more comfortable with Lyft or want to give it a try, we encourage you to do so since you can earn as much money as with Uber.
Just remember that if you don’t like traffic delays, having to find the quickest bus route to use tricks, and more, you are going to need to consider another option.
If you still have your doubts, many drivers should be able to provide more information about both apps.
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