Uber and Lyft businesses are a marketplace that benefits from the effects of scale: when lots of drivers and customers are present, supply and demand are near each other and balance out nicely. It also suffers from the chicken and the egg problem in new cities being launched: there's no driver close-enough in order to ensure low latency for new orders.

To mitigate that, Uber and Lyft heavily subsidize launches in new cities by pre-signing up drivers well ahead of initial demand, to ensure low minute order fulfillment. This is done by giving drivers activity bonuses in the initial new-city market formation stage, no matter the actual orders. This ensures order low latency fulfillment for early adopters in new locales, which leads to customer satisfaction, word-of-mouth advertisement and soon enough full marketplace formation (and lock-in).

If you were trying to compete with Uber in New York City, the main problem you would have is that you'd need a lot of capital to have hundreds/thousands of drivers to ensure order fulfillment on average under 5 minutes by having a driver as close as possible to any new order being placed.

Convincing people (using money) to stay idle despite lack of initial order demand (until the marketplace is formed) takes more than $5 per driver.

I'm not that guy and don't have the credentials, but none of rideshare or food delivery apps pay out $5 for a referral. If they could, they would. In the earliest days, there were even 4 digit incentives for getting into driving for Uber.

People aren't desperate enough to hustle for $5. Even $200 is low. I'd consider that the minimum to even have a program worth running.

i worked with a number of on-demand companies (ridehailing, delivery, home services, etc.) helping them fill their supply-side funnels. as others have pointed out, it doesn't take much exposure or expertise to realize that the supply side of a marketplace can be expensive. of course retention also highly influences the cost.

This page [1] was the first search result and contains many mentions of hundreds of dollars. It easily costs them millions of dollars in each market they enter.

[1] https://ridesharecentral.com/uber-sign-up-bonus