The company rapidly expanded its operations into Seattle, Los Angeles, Philadelphia and Austin. During South By Southwest in 2013, Sidecar made all rides during the conference free, paying its drivers as brand ambassadors during the event. In 2013 it also began serving Boston, Brooklyn, Washington D.C., Charlotte, Chicago, San Diego, Long Beach and Oakland as well.
The company has received $20 million worth of seed funding from numerous investors including USV, Spring Ventures, Huron River Ventures, SV Angel, Lerer Ventures, First Step Fund, Jeff Clarke, Lisa Gansky, Robert Goldberg, Jared Kopf, Konstantin Othmer, Mark Pincus, Martin Roscheisen, Josh Silverman, and Thomas Varghese.
Following an investment round from USV in August 2013, Sidecar pivoted to a new marketplace model in February of 2014. Whereas competitors rely on surge pricing to regulate supply, Sidecar drivers now set their own prices, while riders select the ride they want based on price, car ETA, and type/size of vehicle. Fred Wilson of USV (who joined the board of directors) wrote about his decision to back the company in the face of fierce competition, comparing Sidecar's more personal experience to Etsy, and Uber's more efficient experience to that of Amazon.
Legal challenges and approval in California
In the fall of 2012, the California Public Utilities Commission issued a cease and desist letter to Sidecar (along with rideshare companies Lyft and Uber) and fined each $20,000. However, in 2013 an interim agreement was reached reversing those actions. In September 2013, the CPUC unanimously voted to make the agreement permanent, creating a new category of service called "Transportation Network Companies" to cover Lyft, UberX, and Sidecar, and making California the first state to recognize such services.
In 2013 the Philadelphia Parking Authority carried out a sting operation against Sidecar, and shut it down as an "unauthorized service provider." However, Sidecar has argued that its operation is not taxi service but "a way to organize ridesharing and carpooling."
Sidecar heard a similar concern from the Austin City Council, which passed a law banning the service in early 2013. In response, Sidecar temporarily made its rides in Austin free and filed a lawsuit against the city. The company issued a statement arguing that it isn't in the business of "chauffeured vehicles" and that "sharing resources is not a crime – it’s a solution for a better and more sustainable way of life."
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