I am not a fan of Uber in general and Mr Kalanick in particular but the way Mr Khosrowshahi & co treated him at IPO time, even though he is a board member and has put 10 years of his life, incurring all sort of notorieties, mostly deservedly so, along the way. While his career at Uber was waning anyway, you don't insult someone o so publicly. So this is a foregone conclusion. There is a good chance his new venture is partially a "payback!"
1
Seems as if the real success story will be if and how his successor
will clean up the mess on the road to profit. Good luck with that.
Uber helped hasten in the gig economy that will impoverish millions over the next fifty years. Thirty pieces of silver are now worth about two billion dollars in the current economy. All hail our entrepreneurs.
4
Getting rich without making a profit? How do I get that gig? When pressed to increase pay and treat drivers like employees Uber replied that "drivers were not integral to their business". The people who do the driving are not integral? In other words, they are a replaceable commodity with no inherent value. In other words, people don't matter. Hey Khosrowshahi, good luck cleaning up that corporate culture.
28
Good on him for cashing out. People seem to forget how bad taxis were before ride hailing apps became a thing.
As long as there's market competition (e.g Lyft) and government regulation to keep Uber in check, the world has been improved by the company's existence.
9
It’s convenient to call an UBER but the business has destroyed what used to be a middle class occupation. So much of the profits went to a few people and so little of those profits were paid in taxes that it just seems to me like the whole venture capital thing is a giant scam at tax payers expense.
17
The taxi companies would have survived if they treated their customers right. It's basic economics. Customers were waiting for an alternative and hence rapid adoption.
4
You mean cheaper form of transport. It’s really hard to make a living when you are paying $3.50 a galloon and up then charge your fare $10 to take them to the airport, then pay the company. It can’t last and it won’t but I think it will survive in a much smaller localized form.
At least in PHX I have read with the soon demise of Super Shuttle people just showing up at hotels offering rides to the airport for cash. No Uber No Lyft just trying to make a buck in this economy of and for the wealthy.
5
It's called technological change and it happens every day. Do you place calls thru an operator? Do you refuse to use ATMs because they displaced tellers? Do you climb stairs instead of using the elevator? Where do you park your horse?
9
I wished we did more to regulate companies like Uber, but I can’t say that I’m sympathetic of the cab industry. Before Uber I joked about how long it took a black person, even dressed well, to get a cab. I gladly paid more for Uber during surge to avoid dealing with being passed over by cabs over the color of my skin. The psychological cost can’t be understated.
74
I am fascinated that in an article that lists a number of Uber's business challenges and scandals, Ms. Conger says not one word about a core issue: whether it is legal, or should be legal for Uber to withhold employee status from its drivers.
Aside from whether Uber will eventually turn a profit, and whether it helps or hurts problems like traffic congestion and global warming (also not mentioned) this is the central question in Uber's future.
The article focuses instead on an unfortunately limited range of worthy subjects: whether CEO Khosrowshahi and current management can succeed in:
1) Creating a better work culture for its non-driver employees;
2) "signaling a shift away from the earlier era" and rebuild its image (essentially a public relations goal); and
3) Make at least a move towards profitability.
Having tech experts write about tech subjects without collaboration with a generalist, can echo the kind of group-think myopia that infects many tech start-ups and tech innovations. (Witness Facebook's continued inability to comprehend the impact of its content).
At least we're at the point that Uber is herein described as "ride hailing" company, rather than the laughable "ride sharing app" company definition.
3
Ms. Conger,
It occurs to me that I made some unfortunate presumptions above, and I wish to sincerely apologize to you!
First, this article was primarily about a very controversial figure leaving an important company; and,
Second, I noticed after writing the above that The Times puts labor issues within your realm of expertise in your post article info line.... (Gulp)
Sorry! And I hope you have a very nice remainder of the holiday season! - Mark Keller
He is deplorable.
Uber has undercut labor laws, actively worked to destroy living wages for taxi drivers, and denied any responsibility for it's unknown drivers committing violent acts upon riders. Taxi drivers have committed suicide because of their path of destruction.
Uber, Lyft, and the other Trump-donating 'rideshare' companies must GO.
I ONLY ride in taxis, where I know the driver will be held responsible, knows the laws, and knows the city. Shame on this who do not.
6
If you think that taxi drivers are "responsible" for anything they do, you are sadly mistaken.
4
I will never ride in a taxi unless I have no other option. Uber is a huge improvement.
1
You've done so much harm, Travis. I knew from my first ride that your business model made no sense. Give some of that $2 billion to the families of cabbies who committed suicide. Then maybe you'll get a modicum of respect from me.
5
Imagine making 2 billion by selling shares in a company that has never made a single penny in profit. The company’s only contribution to society is traffic jams, carbon emissions and sexual assaults.
2
@Simon You're not exactly the focus of sexual assault, guy.
I mean.... how hard is it for you to see that?
And you don't end their destruction of living wages and labor laws--? Nice.
4
Uber changed everything Anna. For the better. Ask anyone who lives in the outer boroughs where cabs never traveled. Your Manhattan and rich boroughs of Brooklyn bias is showing.
1
always happy to get insights on business and the economy from critics who work in a cubicle or a drive through
Meanwhile over at Softbank - first Uber, then WeWork. What next?
4
Can we please stop using euphemisms to somehow soften the blows these tech-giants deal out to industries they're "disrupting"... Ride-hailing? Uber has, within a decade, dismasted the Taxi, Livery, Car Service and Limousine industry.
@Darko Begonia
I've never taken Uber, and I take a taxi only every few years now, but I remember all the times I couldn't get a taxi when it was raining, and I ended up walking home in the rain. This was in San Francisco, which had it set up so that the number of taxis was a small fraction of what it should have been. And god forbid you got into a taxi downtown for the short ride home - I never got kicked out of the cab, but almost always got a (mostly) polite lecture about how short rides really weren't what the drivers were interested in.
4
@BayArea101
We’re all the streetcars and busses not operating?
Sure, he’s getting out while his stock still has some value. While Uber was a neat idea, it has never made a profit. To tell you truth, I’m not sure of any other business where you can become a billionaire and have never made a profit. That’s a sad statement about our economy. The fact that someone can become a billionaire founding a company that has never made a single penny in profit shows you how ridiculous our economic system is.
17
@Mike L - “The fact that someone can become a billionaire founding a company that has never made a single penny in profit shows you how ridiculous our economic system is.” you just said a mouthful. I’m absolutely stunned that this guy can become a billionaire by creating, and then unloading onto investors, a company that has burned cash and lost billions. I drove for Uber for 3 days. just to try it before buying stock. i think anyone considering investing in this pipe dream should give driving a shot. It was a cinch to get set up. I was astounded by what a god awful deal it was. The only way one can rationalize driving their own car for the pittance offered is by staying in denial about the real expenses involved and the tax bill that will be due in April. The drivers lose, the investors - at least since the IPO - lose. The only ones that makes out are the wealthy elite and, for now anyway, the customers. I never did buy the stock.
4
This is a good time to shut Uber down. The person who created this multinational multi-billion dollar company, that deliberately violated laws, exploited labor, put women at risk, drove smaller businesses out of town, and created software to help it hide the unlawful activity from law enforcement, has now left with billions. Since the company has not made a profit or treated employees well, there is not any good reason for it to continue to exist.
9
What makes you think that you have any say in the matter?
2
Young Mr. Kalanick should take his line overstepping behaviors and apply them in to humanitarian pursuits, he'd be wildly successful once again.
And, while he does that, he needs someone whispering in his ear that all glory is fleeting.
Line stepping is one thing, habitually doing it, being the Charlie Murphy description of a "habitual line stepper" like Rick James, is totally another.
Young Mr. Kalanick runs the risk of being, like Rick James, a habitual line stepper who turns into a sad joke, unless he gets ahold of that as a habit, a bad habit.
Because when it comes to humanity, we could all use some line stepping right about now, just not the habitual glory seeking kind.
See 'Charlie Murphy Stories' for reference, just in case you don't already know what a habitual line stepper is and looks like.
1
He moved fast and broke things in the mantra of the age.
The Uber business model is six feet under the break even point.
California and other states are clawing back employment rights Uber circumvented with “independent contractors” that threaten Uber with greater costs.
Travis has started another “gig” business that will attract millions in investment.
Bernie Madoff was a piker.
7
He answered the question: "What can we do with these new fangled cell phones?"
1
Well, Kalanick can now wander off into the sunset and buy a winery or something. Leaving his rapacious business model that is little more than modern-age peonage.
5
I’m sorry but I just can’t fathom his role in this company and the compensation he has received. Nobody but body is worth 2 billion dollars for an idea that puts the poor drivers in the poor house while this joker sails away with more money than he could spend in his lifetime. This corporate vs the slave labor needs to come to a halt. It’s the gilded age relived.
10
Gosh, glad he’s going to be able to focus more on his philanthropic work now! Maybe he can start a charity for all of the lives ruined by his rapacious business model.
7
That’s a good exit.
2
Lessons for 2020 and beyond... if Softbank trusts them, your'e about to get robbed.
12
Other people would be wise to dump their Uber stock as well. This company is a dog with no long-term way of making money, in my opinion. It has always been that way.
9
A horrible boss and human. Hi strue colors were shown when he berated a driver caught on dashcam. Hope karma catches up to him. A super creep.
12
@Robert That dashcam is a poor excuse for putting him down. He was reasonable and polite on that recorded conversation. He did nothing wrong!
3
The vile Kalanick teaches us a life lesson: if you smog cities and destroy the climate with crowds of cars, hire poorly-paid drivers who harass passengers, and routinely break labor and business laws, you'll end up embarrassingly wealthy (and not in prison!) if you just daze the media with a logo and an "app".
Hashtag winning! Hashtag sigh.
4
ONE of the most hated men in America.
4
Another vulture capitalist sociopath with a golden parachute has left the building.
Revulsion abounds.
15
He showed that being audacious and thumbing his nose at the municipalities who cared more about protecting taxi cartels than consumers, forced innovation and a better deal for customers all round. How many would return to the days of ordering a cab and expect it to arrive on time if at all? Or cabbies who care less about how they treat you or the condition of the car?
The impact of reciprocal ratings is profound and shifts the power dynamic where both driver and passenger are mutually accountable.
No one complained that cab drivers are independent contractors. Clearly Uber and Lyft drivers are self employed and making a choice to do this work. The status quo and state power to regulate has been threatened.
His sin if it were was fostering an internal culture that condoned harassment. This should never have been allowed. Had he a bit more maturity and mentoring his legacy as one of the good guys would have been assured. He will have to settle for being a transformational innovator.
Let’s hope he has learned and with his 2 billion less taxes, demonstrates meaningful growth in his deployment of such wealth.
9
@Sad reality Uber is a cab company like any other.
2
Travis Kalanick is escaping a financial dumpster fire, before the rest of the world realizes this was just a charade to attract investors.
A detailed look at Uber's financial shows that unless they can drastically increase revenues while holding the line on expenses they will not be profitable for the foreseeable future.
The stock was once as high as $46 per share, today it's around $30. That might be as good as it gets.
11
Uber strove to solve a real problem of cab availability (outside Manhattan say) and deserves real credit. How much of this was done by artificially subsidizing rides and squeezing drivers vs actual technological disruption is highly debatable, but from a rider’s perspective there is a real market need. Final thought, I suspect the joke is on SoftBank.
16
Adam Smith is not about the division of labor. The lesson of the pin-makers is just that your Chamber of Commerce can read as far as page one. Nor is he about Philip of Macedon's important development of the civil service. That tells us that liberals can read as far as page 800 in Volume Two.
The moral philosopher Adam Smith taught us that when there's one bunch of exploiters out to get us we need another bunch to cut them back.
The world's taxi industries have been corrupt for a century because the regulated -- the Michael Cohens of this world with expensive medallions to be protected -- have captured the regulators. Dictatorship of the regulatariat.
We don't need to love Uber, nor Lyft, nor the airport limousine driver making a buck while the car's owner isn't looking. We just need to be grateful that monopoly is the mother of invention and competition results.
8
As our technology continues to race well ahead of our educational, historical,legal, moral, political and socioeconomic ability to effectively and timely balance and weigh individual and group costs and benefits this will continue to happen. With even greater frequency and speed.
What is he going to do with $2 billion and time in his hands and on his side?
7
@blackmamba. He’s working on developing a kitchen for food delivery service among other pursuits. Please do read. But otherwise, with two billion bucks, I suppose he could do anything he wants, huh? I am not a huge fan of Uber after what I have read and only began using Uber/Lyft a few years ago when visiting mainland cities. Instead of renting a car just for emergency trips back and forth to the hospital I tried it; they were fantastic. According to Lyft drivers, they treat their employees slightly better, so I use them. Several friends are drivers and love the job and flexibility of their work hours. The convenience and economy — especially in overpriced rental car markets like Vegas where my mom lives — can’t be overstated. As a technological achievement, it’s simply amazing to use. So call a cab or rent a car if you prefer, but I will continue to save time and money and avoid the car rental hassle by using ride share; the business model ain’t going away.
1
@Mr Dickens Lyft is getting sued by a group of women (including drivers) who were raped on Lyft rides.
1
Why are all commenters complaining about Uber? Nobody forces you to take an Uber. It has significantly improved the consumer experience compared to taxis in most places, e.g. New York. Sure, regulators should require minumum social conditions for drivers. But Travis disrupted a horrible old fashioned and consumer unfriendly business and deserves to be rewarded for that.
26
"Nobody forces you to take an Uber."
We're ALL forced to deal with the depressed wages, car-crowded streets, gutted local mass transit and taxi systems, and even WORSE climate attack it wreaks.
When you pay a company, you don't just get its service, you help it change the world—for worse, with Uber.
35
@Gary Gilbert you mean if our government invested in America's infrastructure there wouldnt be a need for it
7
If mass transit and taxi services behaved as if they were interested in providing a positive customer experience, there would be no need for Uber.
16
glad to see he is doing so well, not so much for the 1000's of families who lost their apartments n homes to make room for all of uber's corporate staff...... it seems the only thing newspapers focus on this stories money and not so much on all the people who lost things like their homes..... i am speaking about san francisco where uber unfortunetly chose to do their disrupting.....
22
He made his 2 billion. That was the plan all along, even if his drivers made slave wages. Another Silicon Valley "visionary" playing everyone for suckers.
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@Hugh CC
If Uber didn't exist, the driver jobs wouldn't exist and these people would be making nothing at all.
You take the innovations people create for granted.
1
@Lin Now we have many people making next-to-nothing and a lot of dead taxi drivers, assaulted women, and weakened labor laws.
Whatever.
3
@anna your white upper class privilege is showing. If you think African American men being passed by cab after cab or residents of the Bronx forced to rely on shady car services at high prices represent the good old days you truly don’t understand the reality of a large portion of New York’s population
4
Hard to believe anyone knows better than Kalanick when to dump the stock.
43
@Carl your comment is pretty unfair. When given a choice of $2 billion cash with certainty or $2 billion in anything, anyone other than the richest few people in the world should take the cash (people with tens of billions). As a controlling personality type he wants out if he can’t manage decision making. He’s making the right decision pure and simple, despite his flaws.
6
Or he wants to diversify or reinvest his wealth.
@AB Maybe unfair, maybe not, but
I think my comment stands up to Occam's razor.
I doubt Kalanick is putting the $2 billion into a safety deposit box or an interest bearing bank account, so he has to do something with it. To the extent he has any concern about Uber investors, I don't see it inspires a lot of confidence in the company's stock for him to clear out completely. (For that matter, it seems Uber has had a lot of bad press lately, which also is not an investor confidence plus.)
Regardless of personality type, how many individuals with $2 billion in one company are out of the management's line of sight on major decisions? To the extent personality is a factor, it looks to me more like an issue of "all about me/just tired of it" than a need to manage decision making.
2
We have all been colonized.
17
The shine is off at least this part of "the gig economy." Ended up that most Uber drivers are lucky to make minimum wage for their time, after they subtract out what Uber keeps, along with the cost of gas, insurance, vehicle depreciation, etc. And, it's now evident that Uber burned through huge amounts of cash on vanity projects like self-driving vehicles, etc. but doesn't have much, if anything, to show for it.
Meanwhile, Kalanick walks away with a cool couple of billion, leaving behind a company that is already on its way to becoming a shriveling husk.
We had the tech bubble crash last decade. This time, it's more like a slow deflating wheeze.
28
Good luck and god speed.
4
His gift to the world - a losing enterprise that essentially reduces human beings to en extension of an app on a mobile phone.
And he's a billionaire to boot.
As someone likes to say - sad.
60
@John Harrington
He created a company that actually adds value to people's lives. Not everyone can afford a car, owns a car, or is able to drive because of medical reasons.
It's easy to criticize others from your armchair.
1
@Lin customers are getting a steal. They make out like bandits for now because prices are unrealistically low; it cannot last. At some point, Uber will have churned through all the possible drivers, investors will demand a return and prices will have to rise substantially. By that time the traditional cab industry will be a shambles and customers will have no choice but to pay up.
4
Kalanick's exit from Uber is the best lift he or anyone could have ever gotten.
Take the money and run ... leaving a company the cannot make a profit and a cadre of drivers who cannot make rent.
Amazon put bookstores at deaths door and has malls across the country hanging by their fingernails. Uber put thousands of cabbie out of work and good luck trying to hail a ride if you don't own a smart phone.
Monopolies are the death to free markets and here we have that scenario at its finest when Uber's top shaker and mover strides off with billions -- Monopoly money for sure.
58
Billions of dollars of wealth generated from a business that has yet to post a single quarter of profitability.
End-stage capitalism at its finest.
140
@William Raudenbush People said all this about Google, Facebook and Amazon founders for years. It was quite simplistic. Making current profits is not a great indicator of companies playing the long game and building something great (if so, VCs would never invest in anything). Uber will make a lid of money one day. Markets are generally rationale. That’s why the stock is worth so much. You can’t blame Travis if they are wrong.
10
@William Raudenbush Uber changed everything. Whether their model will work or not, the markets will figure it out.
2
@AB Amazon followed the model you describe but are a fairly unique example where revenue can take precedent over profit for a long period,Facebook and Google have virtually always been profitable even if their price/earnings were well above the market based off growth potential
3