In a blog post penned today, Sidecar CEO Sunil Paul confirmed that General Motors acquired his ride-hailing company and explained why the deal happened.
Bloomberg first reported on Tuesday that GM had agreed to swoop up San Francisco-based Sidecar, hiring its 22 employees and obtaining the company’s technology and codebase.
In a post titled “Why we sold to GM,” Paul writes that Sidecar was unable to compete against Uber — “a company that raised more capital than any other in history and is infamous for its anti-competitive behavior,” he noted.
“The legacy of Sidecar is that we out-innovated Uber but still failed to win the market,” Paul added. “We failed — for the most part — because Uber is willing to win at any cost and they have practically limitless capital to do it.”
Indeed, Sidecar introduced many new ride-hailing innovations that Uber and Lyft would later implement, like carpooling, for example. It also stayed away from surge pricing and showed customers ride rates before they hailed a driver.
But the company’s ride-hailing product couldn’t compete with Uber, which has raised more than $8 billion, and Lyft, which has raised $2 billion. Sidecar raised $35 million since launching in 2012. It announced that it was shutting down last month.
Importantly, Paul also wrote about Sidecar’s patents, and including US Patent #6356838 for “System and method for determining an efficient transportation route.”
“The key component to the transaction is a license to Sidecar patents,” Paul wrote. “Sidecar retains ownership of those patents.”
TechCrunch has a good analysis on what Sidecar will do with those patents — they could, for example, enforce them, or start a new business with them.
Paul will not be working for GM and will take a break before “starting my next thing,” he said.
“I wish every member of Sidecar all the best,” he wrote. “GM now has one of the most innovative, fastest-moving teams in Silicon Valley working for them.”
GM, meanwhile, is making a serious effort to compete in the ride-hailing arena. On top of the Sidecar acquisition, the car giant earlier this month announced a $500 million investment in Lyft, as both companies will team up to develop a “network of on-demand autonomous vehicles.”
