The Uber Board Has Been On Autopilot
… maybe they were an experiment for those cars that they keep talking about? If so it doesn’t auger well.
I have long argued that no matter what a corporation talks about on its web-site, in its annual report,collateral, presentations … everywhere you look — when it comes down to it — a corporations job is to ‘maximize shareholder value’.
And what that means, no matter how it is disguised, is that it does not matter what Customers, People, Employees, Governments et al think. In fact the cynic inside of me believes that it doesn’t even matter what laws are broken (provided they think they can get away with it and are making money).
Over the last 24 hours, I have seen, read and heard a lot about the ousting of Travis Kalanick from Uber and it is to say the least, disquieting. If I were to aggregate the commentary into a single exchange, it would be this dialogue yesterday between Steve Inskeep and Uri Belriner on NPR.
The scene setter …
Kalanick reportedly agreed to resign after a shareholder revolt and scandals involving the workplace environment.
A dialogue from the extract
INSKEEP: So what made it clear that the man at the top had to go?
BERLINER: Well, what happened was big-time investors — major Silicon Valley venture capitalists — decided that it was time for him to go. These investors have huge stakes in Uber. Uber is valued at nearly $70 billion, making it the most highly-valued private company in America.
INSKEEP: So they just saw him as a risk to their investment?
BERLINER: Clearly, yeah. I mean, he — so much trouble at this company, and the man at the top was connected to so much of it.
In summary ..
… so they saw him as a risk to their investment and he had to go?
But, But, But …
There were so many early warning signs. So many ..
.. Susan Fowler’s blog post in February of this year, which lead to …
.. an open letter to the Uber Board and Investors from Mitch and Freada Kapor just four days later.
.. being used to aid drug trafficking.
.. being investigated by federal authorities over ‘Greyball’ — a tool it used to evade regulators.
.. Travis on video losing his cool — ‘bigly’- with one of his own drivers.
.. ‘accidentally’ not paying drivers in New York.
.. arguing that they are above the law when it comes to complying with local law. Remember when they pulled out of Austin because Austin insisted that Uber should comply with their laws and drivers should be finger printed. So toys were thrown out of the pram and ‘they walked’, returning a year later after lobbying the State for what they deemed was their right to do business on their terms and Austin’s laws were essentially quashed.
.. losing money at an ‘improved’ rate of 700 Million dollars last quarter (it was just shy of a billion dollars the previous quarter).
.. and in London (just to focus on one city) ..
.. where they still have the finest Taxi service in the world despite being attacked at every level by Uber, because only total destruction of the service was good enough for Travis and his henchmen . Take a stroll through this site to get a picture of what those fine people have been fighting.
Where Uber drivers …
.. have had to be warned that “sexual contact” with passengers is not allowed. (I kid you not).
.. are illegally ‘plying for hire’.
.. are involved in untold accidents on the streets, often because they ignore the rules of the road. (Little things like one way streets or drivers that are just so self-centered an unaware that of their surrounding that they don’t even use their driving mirrors.)
.. are arrested for carrying drugs
And Taxi drivers, note TAXI drivers [In London (I think like New York) a Taxi is a very specific vehicle that has a legal definition and is not the same as a mini cab] are reduced to pointing out the obvious to Sadiq Khan (the Mayor) who is now trying to unravel the chummy connections Uber has had in the UK with people like David Cameroon (sic) and Boris Johnson. And as he sets out to do that, Uber has the gall to criticise him for ‘favoring’ London’s black cabs.
… but I digress. The key here is that none of this is new. This has been going on for years. And it’s been reported on, but all ignored. Consider, outside of the tech/SF community, how many people know this story from 2014?
By the way, in that same year a young woman was raped in India by an Uber driver, she is now suing Uber … not over the rape .. that is already done and dusted. This time she is suing over how Uber Executives not only had access to her medical records but were actively and routinely sharing said records amongst themselves.
As a side note … interesting to read in that article that …
Critics condemned Uber over its screening practices when it emerged that the driver had previously been detained for months on suspicion of rape in a different case.
… think about that when you consider the argument that Austin had (see above) and which the State of Texas essentially quashed..
And the importance of that rape to Uber? Nothing. It wasn’t the rape they were concerned about. They were concerned that as a result of that rape, that they were banned from operating in Delhi which they in turn believed was part of an eleborate plan by their Indian competitor Ola.
Aaah yes. Taking a company down by very shady tactics. Uber knows all about that. This link takes you to the story about how they systematically set out to destroy Lyft back in 2014.
No — none of that and so much more has mattered … until ‘the driver’ in the ‘Autopilot Board’ suddenly woke up and recognized that this actually might be bad for shareholders .. ie them.
The problem is that it might be just a tad too late. And — I have to say, if that turns out to be the case, I have but one reaction …
But don’t feel sorry for Travis. He hasn’t really gone. He retains some 10% of the company, his seat on the board and he will likely continue his personal share buy back program as well as his vote counting for 10 times any other vote. Meanwhile Bill Gurley has resigned , seemingly at the request of Travis. So as the board now seeks a new CEO and in turn COO, CFO, SVP Engineering and General Counsel, consider that when they ‘sit at the table’ Travis will be there. I wish them luck with their search.
Finally, I notice this morning that amongst the opinions in the media about who should be the new CEO, Sheryl Sandberg’s name keeps coming up, along with Uber board member Huffington (amongst others), and I am reminded of the Glass Cliff.
One obvious reason for this resonance is that in the decade since we did our original research a large number of women have been promoted to prominent but precarious positions of leadership — women such as Angela Merkel and Julia Gillard. This was particularly true in the wake of the crises triggered by the 2007–8 financial meltdown when women such as Mary Barra, Marissa Mayer, Johanna Sigurdardottir, Ellen Pao, Jill Abramson, Janet Yellen, Theresa May, and Hillary Clinton came to the fore. Indeed, as Emily Peck recently observed in the Huffington Post, these are the women of the glass cliff generation.
Post Post Script
Just read this piece by Adam Townsend — loved his final line ….
In March I began the post-mortem on Uber. The body had not yet given up its ghost, but I was impatient. This is the…medium.com
Venture Capitalists gave (insert company name) billions of dollars with instructions to ‘fake it til you make it’. And they did and didn’t.