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Juno to soft launch this month as the anti-Uber service

Juno, yet another ride-sharing app eager to take on Uber, is expecting to begin a soft launch early this month in New York City.

While the company still tweaks its software, it will start offering rides, first to family and friends and a small circle of passengers, its co-founder said.

“And then we will slowly open the service to more and more people. We want to make sure that everything works right,” chief executive and co-founder Talmon Marco said in a telephone interview late last month. “It’s like a plane taking off when still paving the runway.”

Juno’s launch should test two basic propositions in commerce that go beyond ride-sharing. One harks back to the foundations of free enterprise, and that’s the idea that having ownership of a thing or a business improves its quality. The other is the notion that consumers will make marketplace decisions based on the perceived good of an option. In recent years, businesses have appealed to people’s interest in supporting environmentally sustainable businesses, fair trade for suppliers, and so on.

In this case, Juno’s betting that riders will prefer its service over Uber and other competitors because of better service and superior treatment of its workers – both propositions that are nothing more than pledges from Juno’s founders at this point. One thing is certain, however: Marco, who just missed making a billion dollars when he sold a voice-over-Internet company he created, has access to a lot of capital. Marco says his firm has already enlisted “thousands” of drivers for a soft launch.

“We’re possibly the second-largest player in New York, in terms of the driver pool,” Marco said. “We have sufficient liquidity to launch tomorrow.”

Marco also said that his company is not only recruiting drivers from Uber but he’s taking “the best ones.” He says Juno’s drivers will also be in newer vehicles.

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All drivers there are licensed by the NYC Taxi and Limousine Commission (TLC), as required by law. Their vehicles must also be licensed with the TLC, and they have to carry commercial insurance.

Like Lyft, which also has gone up against Uber, part of Juno’s pitch is that the startup is going to do better by drivers than Uber. Juno’s drivers will provide better service because they’re happier, Marco said. That’s because key to Juno’s model is that the drivers will receive a certain amount of equity in the company, based on how much they drive. The model is common in Silicon Valley, the high-tech cradle that spawned Uber. (Washington Post owner Jeff Bezos is an investor in Uber.)

Under Juno’s ownership plan, drivers — as a class — will receive restricted stock units (RSUs) along with the co-founders and investors. The founders — Marco, Sunny Marueli, Ofer Samocha, and Igor Magazinik  — allocated one billion shares for themselves, a company document says. Every quarter, the company will distribute 25 million RSUs to the drivers group. The goal is that within 10 years, the drivers will have hold one billion RSUs also. To receive RSUs, the drivers must be on the road for at least 120 hours per month for 24 of 30 months. The exact distribution would depend on how many hours a driver puts in, and top-ranked drivers would receive a bonus. Of course those benefits only become realized if the company is sold or offers stock to the public.

“All technology companies are doing this. Why should a company that deals with programmers be any different? I don’t see any reason,” Marco said.

The driver’s happiness – and success – should therefore translate into a better experience for the rider, Marco says.

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In addition, however, Marco believes riders will opt for the firm that has a proven reputation for handling its staff better than competitors. It’s the sort of idea that other companies have used to sell cloth diapers or fast-casual food: the idea that sustainability, transparency, or being environmentally friendly can pay off.

“When it comes down to choosing between Uber and Juno, how would you like to enter that car?” Marco asks. “Would you like to enter the car that is abusive to drivers as with Uber, or would you like to enter that car where the driver is happy and treated better? All things being equal, I believe that the passengers are willing to make the right choice.”

If Marco’s plans come to pass, New Yorkers will be the first to decide.

Here’s the stock ownership plan:

Juno RSU plan