Grab co-founders Tan Hooi Ling (left) and Anthony Tan celebrate the start-up's fifth anniversary. Courtesy: Grab

If you read the headlines, Uber had a very bad year — but while its reputation took a hit, it managed to hang on to its spot as one of the most valuable start-ups in the world. It ranks second in the 2018 CNBC Disruptor 50 list released Tuesday, with a valuation of $69.6 billion, according to PitchBook. Its still-sky-high valuation shows just how much money investors see in the ride-hailing business. Uber's not the only one that scored more cash over the past year. Grab got the largest single financing round in Southeast Asia in 2017. CapitalG, an investment arm within Google parent Alphabet, led a funding round of at least $1 billion for Lyft. Didi Chuxing raised more than $4 billion in its latest round of funding. So it's not surprising all four of these companies are in the top 10 in this year's Disruptor 50 list.

These investments — from venture capitalists and giants like Apple and Google — could pay off big as more consumers opt to order rides on apps and forgo rental cars and taxis. But as ride-hailing companies scale their networks of drivers and users around the world, they are starting to encroach on each other's turf. That could force them to start to differentiate themselves from the competition. Turning a profit, understanding the local market, playing nice with SoftBank and balancing jobs with new technology could determine which start-up has the leading edge. The rivals of ride-hailing — Didi Chuxing, Grab, Lyft and others — are all likely to come to the forefront as Uber prepares to go public, something CEO Dara Khosrowshahi said could happen in 2019. Uber will have to prove to investors that it can beat the competition, despite past struggles like sexual harassment accusations, a cybersecurity breach and regulatory scuffles.

Customers have already shown that they're willing to jump from one app to another at the first sign of trouble: Lyft said this month it has 35 percent of the national ride-sharing market, up from 20 percent 18 months ago. "Uber's brand image took an even bigger hit than expected as it grappled with a series of scandals and PR disasters in 2017," Shelleen Shum, forecasting director at eMarketer, said in a statement this month. Here are some of the other factors that could separate the winners from the losers in the ride-hailing industry.

An end to the cash burn

Ride-hailing companies lose money — and lose a lot of it. And that could be made much worse if regulations and labor disputes go sideways. Investors have been left to determine which companies are most at risk of financial failure and which winning opportunities will be worth the investment. Uber has been one of the most forthcoming companies when it comes to its financials, disclosing earlier this year that its losses jumped 61 percent in 2017, to $4.5 billion. That's despite the fact that much of its core workforce of drivers are not considered payrolled employees of the company (instead, they are contractors in many regions). Uber has also managed to avoid many of the limits that face taxi companies, such as medallion systems — the requirement that vehicles be painted bright yellow paint and regulated by the Taxi and Limousine Commission. Uber's super-high private-market valuation has had its fair share of skeptics over the years, especially given that it's yet to turn a profit. But growing fast — and getting to new markets first — has proved key to improving Uber's market share and revenue.

A man holds an Apple iPad Mini as he uses the Uber app on October 6, 2017, in Hong Kong. Goldman Sachs believes "wealthy Asian capitals" will likely become epicenters of ride-hailing growth, predicting that the number of cars on the road will peak in 2030 and that the ride-hailing will grow eightfold by then. studioEAST | Getty Images News | Getty Images

The question is, is it the wealthy first-world markets or the rapidly growing developing markets that hold the most profit potential? Uber investor Bill Gurley has expressed optimism on Uber's contractor-driven workforce and is confident that ride-hailing companies will benefit as the economy hits "peak car." But he has also pointed out the potential of markets like China and Singapore (home to Uber's rivals, Didi Chuxing and Grab). "You have a single-minded government that can make decisions implicitly. You have a much higher death rate per mile driven ... so you have more of an incentive," Gurley said at the Launch Festival in San Francisco last year. "There's zero chance that China can evolve the way America did as far as cars per household — it's just impossible; there's no roads." Goldman Sachs also said last year that "wealthy Asian capitals" are likely to become epicenters of ride-hailing growth, predicting that the number of cars on the road will peak in 2030 and that the ride-hailing will grow eightfold by then.

Localization

While the opportunity in foreign markets is clear, the local laws and customs often are not — Uber has struggled, for instance, to keep up with the licensing laws in the UK and Europe. That's where local players could have a long-term advantage over market leaders like Uber. There are reasons the ride-hailing business is hard to scale internationally — and why so many are trying. In India, for instance, only 3 percent to 5 percent of the population own cars. But of the 1.25 billion population, 800 million are millennials, and the smartphone market is growing like wildfire.

Pressure to buy rivals — or get bought

Japanese telecom conglomerate SoftBank has emerged over the past two years as a major player in the ride-hailing industry, acquiring a big chunk of Uber's stock, investing in Ola and joining portfolio company Didi in investing in Grab (which agreed to acquire Uber's Southeast Asia business). Suddenly, it seems like SoftBank — and its aggressive CEO, Masayoshi Son — is playing both sides of the market by funding the cash-strapped ride-hailing industry. Rajeev Misra, the CEO of SoftBank Vision Fund, has made it clear that these investments don't amount to a bet against Uber: "I believe the future of Uber is not just transportation but also food delivery, also insurance, car leasing, all kinds of ancillary businesses globally, and that's what the platform has to do," he told CNBC earlier this year. The question is, does SoftBank expect its complex web of ride-hailing investments to be consolidated — and if so, who buys whom? At least for now, Son has said he expects his ride-hailing investments to seek IPOs. But there has already been a wave of businesses changing hands between Uber and its rivals. "If management at Uber, Didi or Grab were to talk with one another and come to an agreement and in so doing raise shareholder value, we will study that," Son has said, according to The Wall Street Journal. "But we will not force them to do anything."

The future of transportation is coming fast — and not everyone may keep up