Some Uber and Lyft drivers say they’ll start their own rideshare co-op

A group of activist Uber and Lyft drivers on Friday announced a campaign to start a driver-owned rideshare co-op, with the goal of filling the void that would be left if the two rideshare giants make good on their vow to leave next month.

Myriad questions remain about whether the venture could actually be up and running — and at what scale — by May 1, the effective date of a Minneapolis driver-pay requirement that has prompted the companies to announce it won’t be worth their while to do business in the city. Uber has said it will cease operations in the entire seven-county metro area, while Lyft says it will pull out of Minneapolis proper.

Friday’s announcement — by the same group of activist drivers that pushed for the minimum-pay requirements for more than a year — is just one possibility in a parade of ventures flooding the Twin Cities since the two app-based companies announced they would leave. A number of those operations have said they would comply with Minneapolis’ new ordinance.

But the co-op endeavor has the blessing of the Minnesota Uber and Lyft Drivers Association (MULDA), a group of drivers that’s won allies among the City Council members who overrode Mayor Jacob Frey’s veto of the driver-pay ordinance, along with a number of legislators pushing for a statewide minimum pay law.

MULDA officials said Friday they’ll support any new rideshare operations that treat drivers fairly. But they held Friday’s news conference, peppered with applause from roughly two dozen drivers, to announce this particular effort.

The co-op plan carries at at least two other distinctions that could prove advantageous:

“It’s the beginning of a new era of justice in the rideshare industry,” MULDA President Eid Ali said, adding that the hope is for the co-op to eventually serve the entire state.

The effort has a long way to go and a lot of money to raise. Uber and Lyft each spend millions annually in state-mandated insurance alone. Erik Forman, a co-founder of the Drivers Cooperative, estimated that $200,000 would be needed to get a local co-op off the ground, “at a bare minimum.”

First, he said, the local market needs to demonstrate there’s an appetite. Forman and Ali sketched out a two-pronged campaign: get drivers and riders signed up, and gin up investors.

They urged prospective riders to download the New York-based Co-op Ride app and register with their Minnesota information. They also encouraged drivers to do the same with the Co-op Driver app; Forman said some 200 drivers had registered as of Friday afternoon. The more riders and drivers sign up, the more viable the endeavor will appear, they said.

While rideshare companies face lower barriers to entry than taxi companies, they’re still regulated by state statutes and local codes in cities such as Minneapolis and St. Paul, as well as the Metropolitan Airports Commission (MAC).

Here are some of the requirements that startups face in order to handle a ride between Minneapolis and Minneapolis-St. Paul International Airport, the most common ride taken in the state.

Licenses: Obtaining a license to operate in Minneapolis will likely take a few weeks after an application has been submitted that meets all of the city’s requirements. Drivers also need to get a license from the MAC.

Insurance: In addition to each driver needing to carry insurance, state law requires a series of insurance policies for each driver that are purchased by the rideshare company. Topping the menu: $1.5 million in liability coverage.

Criminal background checks: Drivers must clear a criminal background check, paid for by the rideshare company using the driver.

Vehicle inspection: Every vehicle must be inspected for basic roadworthiness and safety.

Also attending Friday’s news conference was Mustafah Sheikh, who announced he hoped to locally launch his ride-hailing app, Hich, before May 1. Hich, which operates in some parts of Canada and Africa, is different from Hitch, a long-distance ride rideshare company.

Here are some of the other ventures that have indicated a desire to come to the Twin Cities: MOOV, MyWeels, Empower, Pikapp, Wridz, Revo and Teleport.