Silicon Valley Chases Road Rage Riches

Traffic transportation
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One hundred years ago, the big transportation worry in places like New York was heaps of horse manure filling cities at the height of horse-drawn carriage commuting age. There were apocalyptic predictions about the direction in which society was headed if the problem wasn't solved. What no one saw coming was the invention of the automobile.

The automobile has now come full circle. One century's solution to what seemed like an insurmountable problem is now a new century's pressing global threat.

We drive too much, in way too many cars. We lose years of our lives sitting in traffic, wasting fuel while continuing to warm the planet. We all won't ride our bikes to work, or plug in hybrids. Light rail is still a dream in most of the U.S. So what's the answer to an unsustainable transportation system? Disrupting it; changing its reckless course.

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Four companies onCNBC's inaugural Disruptor 50 list are attacking this issue: Getaround, Inrix, Uberand Waze, with new models designed to disrupt the status quo in transportation. (There is also SpaceX, which wants to convince us to leave our cars far behind and for good, and one day join an 80,000 person Mars colony.)

The four car-based disruptors on the CNBC Disruptor 50 list are navigating the market using trends now ubiquitous in the world of startups and, in particular, some of the most heavily funded disruptive business models: social media, community sharing, and Big Data analysis are all being applied to the problems in the transportation market.

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The stats on our car-based transportation system are depressing.

  • In the next decade, the 1 billion car market is expected to double (not all Tesla Model S's, either).
  • Americans waste 500 years each year stuck in traffic—4.2 billion hours.
  • Roughly 3.9 billion gallons of gas are wasted annually sitting in traffic.
  • Traffic costs the U.S. economy over $100 billion a year.

Getaround thinks it can do its part to solve the problem of an inefficient, costly consumer car market by convincing more people to adopt the car-sharing model. The average car sits idle 22 hours per day, and that's a profit opportunity for you (as much as $800 per month). The model is similar to Airbnb's model in the travel sector, which allows individuals to turn their private residences into an ad hoc lodging industry option.

Getaround CEO Sam Zaid thinks of his company's disruptive model in a simple way: "Creative destruction."

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Inrix and Waze are taking on the traffic bottleneck through the inputting and analysis of mass amounts of data. The startup world across sectors is focused on monetizing the computing power available today and the ability of algorithms to draw intelligent conclusions. In the case of Waze, it's a community-driven app that turns each driver into an important data point—while we aren't allowed to text while driving, apparently some among its 36 million user-drivers found a second to add 90 million user reports and 65,000 Waze map editors made 500 million map edits to Waze during 2012.

"Disruption means doing much more with less, via radically different methods like the deep collaboration of Waze's Wiki-style map-making system," said Noam Bardin, CEO of Waze.

Doing more with less may also mean making a lot of money for Waze, specifically, through its location-guided advertising platform for brands and their consumers to reach drivers in real-time. The company has reportedly attracted the acquisitive attention of Facebook, rumored to be offering $1 billion for the company.

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Inrix houses the largest traffic information network in the world, offering real-time, historical and predictive traffic flow information. It's the Big Data player in the transport market, and claims its data can help an average passenger save at least one full day in traffic, one tank of gas and 350 pounds of CO2 per year. Inrix can use traffic data to tell you whether the macroeconomy is looking better or worse, why you should buy one house over another, and whether on a winter morning that road you normally drive has been plowed (by inputting and analyzing data from windshield wipers and anti-lock breaking systems).

SpaceX President Gwynne Shotwell noted that "When legacy firms fail to innovate, start-ups jump into the market and thrive at the establishment's expense. That's disruption."

These transportation disruptors have gotten off to a quick start, but if even their combined efforts fail to solve the 21st Century version of the horse manure conundrum, many more of us than a mere 80,000 may be looking to join Shotwell and his boss Elon Musk on Mars.