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Hi, I’m Brad Feld, a managing director at the Foundry Group who lives in Boulder, Colorado. I invest in software and Internet companies around the US, run marathons and read a lot.

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The Colorado PUC Trying to Shut Down UberDenver

Comments (100)

In yet another insane move by government against entrepreneurs and job creators, the Colorado PUC is proposing a new set of rules that would shut down Uber in Colorado. This is protectionism and misuse of power in an egregious form. Government supporting powerful incubants (the taxi industry) that are threatened by disruptive innovators through regulation. Yuck.

As a Colorado entrepreneurial community, we shouldn’t stand for this. As citizens and tax payers in Colorado, we shouldn’t stand for this. And as innovators, looking forward, we shouldn’t stand for this. My call to action is at the end of this email – if you do nothing else, go sign the petition right now. And tell everyone you know.

I think our governor, John Hickenlooper, is awesome. I hope he focuses on this quickly and demonstrates his own background as an entrepreneur, as an innovator, and as a proponent of innovation. Given the launch of his new effort to rebrand Colorado for the next 20 years, I hope he focuses his brandCO effort on innovation, entrepreneurship, and the future, rather than protecting incumbents in regulated industries through the misuse of power, especially in areas – such as the taxi industry – where the service, at least in Colorado, is uniformly poor. Colorado’s new brand shouldn’t be “backwater protectionist state” – yeah – that doesn’t sound very good to me.

The Uber story has already played out in a number of other states. The regulators quickly back down from the powerful lobby / industry groups that are influencing the new regulations. In some cases, it’s a simple misuse of power. In others, it’s a lack of understanding of what is going on. And in others, it has been a backward looking regulator, or government, that momentarily forgets that it serves its citizens, not a small constituent of incumbents.

The PUC rule changes are extensive, but there are several cleverly woven in that effectively shut down Uber if implemented. Read the following examples and be appalled.

- Section 6301: Uber’s pricing model will be made illegal: Sedan companies will no longer be able to charge by distance (section 6301): This is akin to telling a hotel it is illegal to charge by the night.

- Section 6309: Uber’s partner-drivers will effectively be banned from Downtown — by making it illegal for an Uber car to be within 200 feet of a restaurant, bar, or hotel. This is TAXI protectionism at its finest. The intent is to make sure that only a TAXI can provide a quick pickup in Denver’s city center.

- Section 6001 (ff): Uber’s partner-drivers will be forced out of business — partnering with local sedan companies will be prohibited.

These rules are not designed to promote safety, nor improve quality of service. They are intended to stop innovation, protect incumbents, hurt independent drivers, and shut down Uber in Denver.

There are several things you can do right now.

1) Contact Gov. Hickenlooper and tell him, “Save Uber in Colorado! Withdraw PUC Rules Changes to sections 6001, 6301, & 6309.”

Email Gov. Hickenlooper

Write on Gov. Hickenlooper’s Facebook Wall

2)  Contact the Colorado PUC Directly:

Email Joshua Epel, Chairman

Email Doug Dean, Director

3)  Sign the petition that shows the PUC your #UberDENVERLove.

Disclosure: I am NOT a direct investor in Uber, although I have personal investments in several VC funds that are invested in Uber. However, my ownership is tiny and the amount I’ve spent on Uber services since they launched several years in the bay area dwarfs the amount of money I’d ever expect to see from my indirect investment. I’ve written this because I love the service, love the company, and love their innovation. Society improves when innovators like Uber are able to do their thing – it’s a deeply held belief of mine – that’s why I’ve written this post.

  • http://byJess.net/ Jess Bachman

    Not only will opposition to this proposed regulation save Uber, but it may save Denver from being a pariah to other entrepreneurs and rapidly expanding business who may consider it too risky to due business in an unfriendly and unpredictable regulatory environment.

    • http://www.feld.com bfeld

      Jess – powerful point. It’s not just this specific issue, but the overall message that state government is sending to anyone about the willingness of the state to embrace entrepreneurship and innovation. I believe you have to be all in on these issues – you can’t say one thing and then act a different way.

      • Phil

        Brad – by all accounts you seem like a good dude and exceptionally bright guy. But when you and other left-leaning vc’s vote into office the very same people who are so hostile to entrepreneurship and innovation, there are only two possible conclusions to draw; a) you expect to be treated differently by these politicians b/c you voted for them, or b) you’re breathtakingly naive when it comes to politics. Sorry, man, but i hope it’s the latter.

        • http://www.feld.com bfeld

          Phil – thx for the feedback. I don’t think Governor Hickenlooper is hostile to entrepreneurship and innovation. Instead, I expect he’ll be articulate about this issue once he realizes what is going on. And – if I’m wrong, then I’ll have learned an important lesson.

          • Phil

            Brad – my hunch is The governor knows exactly what’s going on. He picked Josh Epel to run the PUC almost two years ago.

            In any event, I appreciate the reply and wish you all the best.

          • http://www.feld.com bfeld

            We will find that out soon enough!

        • James Mitchell

          Phil, you nailed it on the head. I have read a lot of posts by Brad that say in essence, “I supported Democrat X and now I am shocked that he is advocating something stupid on …” (pick the issue — immigration, science education, capital gains, sales tax on Internet purchases)

          • http://www.pointsandfigures.com pointsnfigures

            I would characterize most VCs as classical liberals in the vein of Milton Friedman. A lot of VCs object to the social agenda of the Republican party, and most entrepreneurship can rise above the central planning, high tax/high spend on the Democratic side. Additionally, almost all Americans I run into feel empathetic to people less fortunate than themselves. Instead of thinking about free market capitalistic ways to change that, they rely on entrenched government programs that have been in place since 1933.

            Solution. Elect VCs and reform both parties…..

          • http://www.feld.com bfeld

            Oh please. I’m so glad you have an open mind. FYI – I’m an independent, not a democrat, and I support plenty of republicans who do equally stupid things.

          • Fender

            Technically you’re unaffiliated – there isn’t an “independent” party ;-)

          • http://www.feld.com bfeld

            That I am. I stand corrected.

  • Sparkle_Agency

    Wow this is pretty shocking. I would sign the petition, but not in Colorado, or even in the United States.

    • http://www.itdatabase.com/ Travis Van

      Same here. Thankfully in San Francisco they just divert whatever discretionary income we have to methadone clinics, needle exchanges, and paying health insurance for restaurant waiters so we don’t have to worry about what to do with our pocket cash.

  • http://twitter.com/chuckaikens Chuck Aikens

    I signed the petition…thanks for bringing this issue to light.

  • picksix66

    I think it hilarious that Denver wants you to get a cab, but yet there aren’t any, ever, unless you are in a 3 block radius downtown. Then the cabbies try to take you on the long route. But then again, the state makes a ton of money on drunk driving, so why would they want more ways for people to get home??

  • PI

    I find this to be a little short sighted. These regulatory bodies help a lot more people than they hurt and, as someone who has been a victim of Uber’s “surge pricing,” I like the idea that this service is regulated at the city level as opposed to being controlled by people that have a history of taking advantage of their customers when they need the service the most. I’m all for allowing Uber to thrive but I don’t see any reason why they can’t play by the same rules as everyone else, especially since they’re ultimately designed to help both consumers and the people that have worked in this business for decades.

    • http://www.feld.com bfeld

      Re: “These regulatory bodies help a lot more people than they hurt” – I’m not sure how / why you can make sure a sweeping general statement. There are many different perspectives on this, and it’s very dependent on the specific regulatory activity.

      Re: Uber surge pricing – That doesn’t seem like anything that should be regulation driven – that’s totally a market phenomenon.

      Re: Same rules as everyone else. To be clear, the PUC is CHANGING THE RULES to exclude Uber.

    • http://www.itdatabase.com/ Travis Van

      Yeah, regulatory bodies are great at protecting customers from predatory pricing – evidenced by the fairness and transparency of telcos, cable service providers and utilities companies. Thank goodness we’ve all been protected from them, because were we not they might have incredibly confusing pricing models, hidden line items and unfair penalties for early cancellation.

  • http://www.itdatabase.com/ Travis Van

    What I find bizarre about the fervor around govts rallying against Uber is — where was the groundswell of outrage against the “medallion” restriction of total # of taxi drivers PERIOD? For a long time, taxi drivers in major metros have been scorned by the false “scarcity of taxis” driven by local governments who view it as a cash register and impose the medallions requirement to keep the # of cabs down. Instead of allowing the economics play out (which would result in more taxis and a lower cost for the PUBLIC TAXPAYERS), the gov’t looks at how to squeeze maximum $ out of the industry. I’m against the efforts to hold Uber down, just sayin’ that taxi drivers have been getting screwed to the nth long before this rallying around Uber ever kicked up.

    • http://www.feld.com bfeld

      I lived in Boston between 1983 and 1995. I’ve seen this play out over and over and over again, in multiple geographies. It’s another example of power + corrupt + uneconomic for the citizens the regulatory agencies are supposed to be protecting in the first place!

  • James Mitchell

    Speaking only from the point of view of where I live, it is hard to imagine an industry less deserving than the taxicab industry of protectionism. Half the drivers do not speak English and do not know how to find obvious landmarks.

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  • http://www.pointsandfigures.com pointsnfigures

    Agree. They tried to shut them down in Chicago. http://pointsandfigures.com/2012/11/01/do-we-believe-in-creative-destruction-or-not/ They haven’t yet and their business is growing. Additionally, Chicago cabs are cleaner and smell better than they used to-so it’s clear Uber is having a positive effect on the entire car business.

  • sharif

    none sense no one know how the freedom of USA but PUC should not interfere no one

  • http://www.StevenGroves.com/ StevenGroves

    Petition signed. I worked with a friend launching a start-up that used PDA’s / mobile phones vs. expensive, custom radio & comm tech and remember how tough it was to get companies to even look at what we were doing. The change that Uber is providing may well be come commonplace, but not before it goes through a few more instances like this. Good luck Uber and thanks for bringing it to us Brad.

  • Anonymous

    It’s actually rather sad that the PUC still believes it needs to regulate taxi cabs. How about we trade off the regulation of taxis for regulation of parking lots in downtown Denver. Now, there’s a need.

  • http://www.conceptbakery.com Klaus Holzapfel

    Thanks for moving this into the spotlight. I think it is a crucial case for us. Are we just talking the talk when it comes to us being a modern and innovative ecosystem? We will soon have a metro rail system that will set standards for other cities. Yes the rides from and to the airport will go down but overall this might create more need for cab rides (when people leave their cars at home). The cab industry has proven to be very agressive in other cities and I’d love to see the power of that cartel being broken. Their claims have little to do with Uber not delivering a good service. It’s just about their resistance to adjust to and reform themselves. Everyone else has to acknowledge the power of the web. Why should they be excempt?

    And yes, this is in stark contrast to our governor being a fairly progressive pro-business person.

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