> If Mr Gurley and the rest of the board cannot find an experienced candidate willing to work with Mr Kalanick, calls for him to step down may grow louder. But that is his decision to take. Uber is a prominent example of founders’ power at fast-growing tech firms. On its own, Uber’s board does not have the clout to change the CEO, because of his super-voting shares and those of his co-founder, Garrett Camp: together they control a majority of the voting stock.
Well, that's a pretty bad corporate governance problem. The CEO's behavior, and the culture he created at the company, have badly damaged the company's image and driven away senior executives and probably a lot of engineers too -- and yet the board can't get rid of him.
I would certainly think twice about investing in a company whose board is powerless to do anything about such a terrible self-inflicted wound.
While I'm not sure I disagree with you, devil's advocate here...do you think you'd feel the same way as a founder who could prevent yourself from ever being fired from your own company? I can think of several situations where retaining that kind of control would be hugely beneficial and important (in the right hands of course, which is the whole issue here).
And that's why Google and Facebook (I think) both took steps for the founders to retain control in that manner. So that they would be able to focus on what's important to the company vs. bs next quarter results. And it's worked out well for both of them. But of course, they don't seem to have the "ethics" issues that Uber does.
Care to elaborate on why? The initial condition here is founders having full voting rights. In a free marketplace, they're free to sell shares without (or with little) voting rights as they wish. If investors aren't happy with it (which doesn't seem to be the case), they're free to not invest.
You seem to be stating that there's a moral imperative that founders voluntarily give away voting rights to investors.
I don't know if I would call it a "moral" imperative, but it's a basic tenet of good corporate governance that the board, which represents the shareholders, should be able to prevent the management from harming the company or the shareholder's interests.
In the case of Uber, the CEO could run the company into the ground, and nobody would be able to prevent that.
A trend toward worse corporate governance could harm the entire economy eventually.
Got it, I can buy into the argument that pro-rata voting rights would lead to better performing companies than founder-controlled companies (in the long run and on average).
But, I don't see any reason why founders should be obligated to give away voting rights.
In other words, I would argue that if founder CEO's want that level of control, they SHOULD get it.
It's sort of weird to even phrase it as "get it". They already have it by default, and I don't see why we should have any right to force them to give it away.
Isn't that the "risk" part of private investment like this?
In theory if/when Uber goes public, the market can hammer his share price into submission. His choice then would be to step down and keep his money, or watch his valuation rapidly dwindle as low as the market dictates.
The investors came into the company knowing he will keep the control it was a risk they were willing to take. Even if he runs it into the ground they don't have a leg to stand on. They were not strong armed into investing it was a choice they made.
It also raises another good question: how big of a fool would you have to be to take the job Gurley and the board are trying to fill? How do you rein in a CEO who has total, unchallengeable control of the company?
(Maybe if they offer enough money, it's worth it even if it's a suicide mission? Though "just cash the checks and wait for your inevitable dismissal" doesn't seem like an attractive offer for anyone who's good enough to have alternatives.)
There's practically a limitless supply of people that would do it for $10 million.
The problem is finding someone worth paying that much (and the pretense that whether someone is worth paying that much can be determined ahead of time).
In situations like this, in which an executive is hired to reform a company and is set against entrenched management and culture, golden parachutes seem entirely justified to me.
I'm not so sure. Wouldn't it be better for society overall if these companies were condemned to die by their own hand, instead of being able to be saved by an outsider? If they're saved, then all the people who participated in creating this toxic culture are rewarded. If the company goes belly-up, then any valuable assets can be bought by other firms for pennies on the dollar, and those and other competing, and hopefully better-run firms will have a shot at success, with this toxic company cleared out of the market and leaving a void.
I'm not following. Are you proposing that companies should not be allowed to hire someone from the outside to fix severe culture issues? The problem with such a policy is the mechanism through which we'd determine which companies are condemned.
From your comment, I gather that if it were up to you, you'd sentence Uber to death instead of giving them a shot at redemption. You wouldn't be alone in this perspective, but I think you're overlooking the thousands of GOOD people that would be adversely affected and punished by such a decision. All to punish a couple people you believe to be evil.
>Are you proposing that companies should not be allowed to hire someone from the outside to fix severe culture issues?
Not exactly, just that they shouldn't be able to offer them generous golden parachutes.
Of course, I'm not so sure about the legality of this, but perhaps within corporate law a law could be made that companies aren't allowed to promise enormous sums of money to people when they fail to fix the problem, and the company is now in dire financial straits. When the company is having severe financial difficulty, the first dibs should go to anyone it owes money to, not someone they promised a big golden parachute to in case he couldn't turn it around.
>I gather that if it were up to you, you'd sentence Uber to death instead of giving them a shot at redemption.
Absolutely. The good people should have found new jobs by now; all accounts now show this company to be truly toxic, at many levels (not just "a couple people"). They should not be rewarded with a shot at redemption. Now, if they can find someone willing to take on this challenge of turning the company around, who is willing to assume a great deal of risk in doing so (at least risk not getting paid much for it), then that's fine. I just don't think they should be allowed to offer a golden parachute if that person fails. Then, such people can evaluate such offers based on the true risk of the situation, instead of knowing they'll be safely off with their golden parachute if they can't make it work.
The negative impact of such a decision wouldn't just be on Uber employees, but also the 500,000 drivers actively using their app; on average making $30K per year. A large fraction of these people are probably depending solely on this income to make ends meet.
In an ideal world, there'd be an immediate replacement for Uber for all these drivers to switch over. However, we all know that's wishful thinking. At best, capacity would only be halved, which still means you'd effectively be letting go of 250K people tomorrow.
Imo, even if your goal is to enact maximum punishment on Travis and Co, doing so THROUGH punishing the company is a really destructive way to accomplish said task.
You think Uber drivers can't just switch to the competition at the drop of a hat? Lots of them already work for both Uber and Lyft at the same time! They're the absolute last people I'm worried about hurting here. There are other "ride-sharing" companies out there, you know. And when Uber is clearly going down the drain, more competitors will pop up in anticipation of taking advantage of the situation.
What percentage of customers/drivers do YOU think would switch over to Lyft et al?
From my experience in growth/marketing, I would bet there would be around 50% drop off, but I could definitely be wrong! These things are hard to guess. (Customers need to switch as well as drivers)
Even a 1% drop off leads to 5000 people let go. Anything substantial would lead me to strongly considering other avenues of redemption.
To be sure, I'd want to better understand the magnitude of effect here before saying that sentencing Uber to death is "absolutely" the right thing to do.
>What percentage of customers/drivers do YOU think would switch over to Lyft et al?
Um, all of them? If Uber went under, what choice would they have? Why would customers give up on Uber/Lyft and go back to cabs, when there's at least one company that does almost the exact same thing and is a direct competitor? Why would they refuse to install the Lyft app, when they've already shown they're willing to install the Uber app? And why would drivers not go to work for the competition, esp. with a giant void left by Uber in the market?
I'm sorry, I think your argument is ridiculous. Right now, I'm eating some spaghetti for dinner that I just made. It's made with Brand X spaghettin and Brand A of sauce. Now if either of these brands suddenly went under and disappeared from the supermarket aisles, do you think I'm going to just stop eating spaghetti altogether? That's insane. And even that would make more sense than this Uber scenario. Uber is just a way to get you from point A to point B, and has succeeded so far because it's both cheaper and more convenient, in most cases, than the incumbent services. People aren't going to suddenly stop needing to get transported places without Uber around, nor are those incumbents improving enough to get them back, at least in many places (if they were, Uber would have a large loss of ridership there already). And Lyft is already there (in many markets at least), offering the exact same service as Uber, frequently with many of the same drivers. Why wouldn't people switch? There's only two reasons: 1) ignorace (easily countered with some advertising, plus word-of-mouth from drivers during Uber's last days), and 2) lack of availability of Lyft or other competitors in certain locations (I believe Toronto does not have Lyft for some odd reason). At least with my spaghetti example someone might say they love sauce brand C so much that they just wouldn't bother making much spaghetti without it and would eat other stuff.
I agree with the reasons you ended your last comment on. Ignorance and lack of availability (or rather a mismatch in supply and demand) would surely lead to drop-off. In addition, laziness will lead to drop-off i.e. "Uber was marginally better than taking the next best alternative for me. I'll just go back to that now because I'm too lazy to figure out this Lyft thing".
I'd guess the difference in our conclusions is based on your belief that these are "easily countered with some advertising".
Most of my background is in paid advertising, and reactivation on defunct company contacts is never close to 100% -- not even close.
I still don't see the problem. In this case, the people too stupid to figure out the Lyft app (seriously, if you can figure out the Uber app, then the Lyft app isn't any harder) can just go back to using cabs. So the cab drivers now are making more money, and the cab companies will need to hire more people, who could be former Uber drivers. What's the problem?
Keeping around rotten management because you don't want to disrupt the people below them is always the wrong thing to do, because then you're not fixing the problem, you're letting it fester.
If people go back to cabs then all is fine from an employment standpoint, but the problem is the section of customers whose best alternative is public transit, walking, cycling. (I'm in this group)
After thinking more about this, I think I actually agree with your argument that we should sentence Uber to death just because it's the 'right' thing to do even if it indirectly leads to unemployment of a lot of people.
However, we started this thread under a shared premise of utilitarianism. If we treat these 'death sentence' decisions on on a case-by-case (i.e. no future precedent set), it's hard for me to believe punishing the 'corrupt management' (which probably only amounts to a dozen individuals) is worth screwing with peoples' livelihoods. At Uber's scale, it just seems like a given that there will be hundreds of people whose lives will be SERIOUSLY screwed, albeit indirectly.
I think it's more than a dozen individuals; from what we're seeing with Uber, and what I know about corporate culture from experience, bad corporate culture permeates the entire company, from the top down. In Uber's case, this means not only their executives, but also their HR department (which backs up harassers), and also their engineering (which is very large for a company like that). The drivers are a different thing because they don't work directly with the corporate HQ people and are really just part-time contractors anyway. So I really don't have a problem with those hundreds of people at Uber HQ getting seriously screwed. Most of them will probably get jobs elsewhere anyway, though they'll now have the Uber resume stain, but these people aren't poor people living paycheck-to-paycheck, they're relatively wealthy Silicon Valley office workers (engineers, managers, etc.).
For everyone else, drivers, customers, etc., I really do think they'll just move on to other things and it won't be a big deal. Lyft seems to be doing fine, though it'd be nice if they eliminated the tipping.
Yeah, it sounds like nearly a nearly textbook definition of one of the problems capitalism (and a "free market" with low barriers to entry) are supposed to solve. You don't challenge someone's control of their company, you just challenge the company. "Good" employees and customers who object to their culture jump ship to yours; "bad" employees go down with the ship.
Of course, because of the innumerable real-world confounds to the model (not least of which is the artificial-or-otherwise high barrier to entry that most industries seek to ensconce themselves in), this doesn't happen anywhere else, but at least here with novel companies competing in their early stages, I don't see why anyone would bother "saving" a company that will be dragging against you every step of the way you can just invest in one of its competitors and let that dragging force drag your competition down, to your advantage.
If the "capitalism will save us" model can't succeed here of all places, I don't know why people still bother with it anymore.
"I didn't see it then, but it turned out that getting fired from Apple was the best thing that could have ever happened to me. ..... I'm pretty sure none of this would have happened if I hadn't been fired from Apple. It was awful tasting medicine, but I guess the patient needed it." - Steve Jobs
The Steve Jobs Apple fired was not the same man that returned to save the company. The caricature portrayal of him with an aggressive, petty, demanding, obnoxious style were all pretty much true back then. If Kalanick is at an equivalent stage, then Uber may really desperately need to get rid of him. Whether he ever vindicates himself and realises a greater potential remains to be seen, but it may well be that remaining at Uber regardless of his behaviour will just feed the negative side of his nature.
Except as twb points out, the Uber board can't oust him. And somehow I feel like a Jobsian journey of self-discovery is outside the reach of someone whose problems aren't coming from a perfectionist streak but rather a disdain for the customers/workers/employees using/building the service.
On the other hand, sounds ripe for some other company not struggling with the same culture issues nor saddled with the sizable VC debt to come in for the kill.
> At this point I don't know if even a new CEO could save this company.
Honestly I am more concerned about saving the world from this company, because it still looks like they are going to win. Have you seen any signs that Lyft can compete in the worldwide market?
They are valued at 70 Billion, how does that just wither and die? One lawsuit can be dragged out a long time and their lawyers will do their best to reduce and fees no matter how wrong Uber actually is (or isn't I don't know).
Consider the size of Uber now and compare that to the size of Microsoft 15 years in the DOJ antitrust trial. They are about the same size, that gives them lots of options.
Valued at means nothing really, it speaks to investment and while its not worth nothing they are currently burning about 3/4 billion per quarter [1], and have no profitable quarters anywhere on the horizon.
They have always been betting their future on autonomous cars and the Waymo lawsuit stands a good chance to set them back a decade and they do not have the current capital to withstand that.
MS was already public when they had the antitrust lawsuit and was making money. To try and compare MS and Uber is not close to the same thing.
$3 billion per year isn't that much at that scale, it would still take them many years to burn through their estimated cash reserves. That is if they did nothing and earned no money, but they earn something. They would have time to come up with a plan even if it were a backup backup plan that involved shedding a large fraction of the company.
If anything being public hinders options. Being private they can do a huge number of things public companies cannot, first and foremost is an IPO.
I make a habit of talking to taxi drivers about Uber. Consistently they say they drive taxis because there is no money in driving for Uber (which of course that tells us less than it seems, because they are self-selected to be people who prefer driving taxis). One told me something new: I asked, as I often do, if they don't make money then why are there so many Uber drivers?
This man said that some Uber drivers are trapped by car loans: They are working-class people who took out loans to buy their Uber cars. All cars lose value the moment they are driven off the lot and these cars are driven hard and for high mileage, so their resale value is low. He said these drivers keep working for Uber because they have to try to pay off the loans. (I know nothing else about that story other than what one random driver told me; I'm hoping others can contribute some better knowledge about it.)
It struck me: Not only does Uber treat their workers like contractors and give them no benefits or other employee protections, but they ask (often) working class people to provide Uber's capital. Arguably, it's like General Motors calling factory workers 'independent contractors' and asking them to bring their own machinery. In contrast, taxi drivers lease the cab for a shift, AFAIK; they have no long-term capital investment or debt trap. It's almost as if Uber's main business proposition is a loophole in labor rules that allows them to shift almost all costs onto their own workers.
That said, I hesitate to pile on, even for a company I don't like personally (which is why I take cabs). Let's not let the hype exceed the reality.
Trapped in a car loan thing is their Xchange leasing program. They give sub prime car loans to anyone with a pulse if they agree to do drive for uber. Their car payments are taken directly from their driver income. These leases are expensive, a corrola costs about 150 a week to lease. People got trapped because after signing uber dropped rates and the driver can't afford their payment and have to work more hours for the same money. Somne simply work to make the payment and no longer earn money for themselves. If you remember the driver that got in a argument with the CEO, this is what he was taking aboutvwhen he said he lost 90k
He leased a 2016 Toyota Corolla from Xchange in November, paying $155 a week. Two months later, Uber slashed fares nationally. Soon Hofstede had trouble keeping up with his payments. He went from making $200 in a weekend to $140 in a weekend, he said. "It got to the point that I would drive just to meet my payment," he said. "If you were short on your payment for a week it would roll onto the payment for next week. It starts adding up."
I get that same discomforting feeling seeing advertisements for pizza delivery. It's core to many businesses but the employees are often the ones providing the equipment.
I've heard this referred to as modern day share cropping.
My understanding is that very few places have a medallion system. It's apparently quite common in the US, but I can't say I've heard about it anywhere else.
I don't know, and it's likely they don't do it at all.
Why would the number of taxis need to be controlled? I don't know much about the taxi industry and perhaps there is some good reason for it that I am simply not aware of?
My baseless assumption always has been that it is for two reasons:
* It's one of those situations where the free market fails. Because anyone with a car can give someone a ride, it creates a race to the bottom and nobody can make money. You'll note that one criticism of Uber is that they create exactly that situation.
* Safety and fraud prevention for customers
Note that the community has an interest in quality transportation, including for tourists.
But does controlling the number of taxis achieve those goals? The countries that I have experience with all have regulations attempting to ensure those very things that you mentioned, but none of them actively limits the number of taxis.
The medallion owners make a long-term capital investment. The drivers lease the car per shift or per 24 hours, and have no such investment. (As I understand it.)
As a part-time Uber driver in Toronto I haven't noticed any drop-off in ride requests whatsoever. Uber will survive, at least unless someone else beats them to market with an autonomous alternative.
I don't get any incentives or bonuses either, just ~75% of the gross receipts from the customer.
You are in a city where Lyft is not available. Does Uber have serious competition in Toronto? Here in California, there is zero downside to using Lyft instead of Uber, so a switch is much easier.
The only reason I have Uber on my phone is for trips to Ottawa.
I think it's important to remember that Uber users aren't loyal: if a ride isn't immediately available through Uber, they use Lyft; if Lyft isn't available, they go to the next app.
While I agree that the service is here to stay, the individual players are likely to shift.
Based on what? I'm pretty loyal to Uber and use it because I know what I'm going to pay when I order the ride and because I'm not pressured to tip in the app. I guess if another app had both those features, the same ride availability, and cost the same I'd download and try it but currently none of them, that I've tried, do.
The naked capitalism series is written by a cab dispatch consultant, and reads almost like a paid hatchet job. Makes huge assumptions on data not in hand, and spins iffy conclusions with evident bias. At one point he claims Ubers costs can never be as low as cab dispatch because Uber is spending money expanding! That makes zero sense.
It's pretty clear Uber is in heavy investment mode, in market expansion as well as new businesses (uber-eats, self driving cars, etc), no one can know what their real costs per ride are unless they can break out that detail.
But it's also clear in their core business their cost to dispatch a ride should only be pennies.
Yes, "available" isn't probably the correct term, but what the author of that comment probably meant was stuff like "surging prices", "wait time", etc.
That you are a an exception. I've never had a friend suggest Lyft, i'm not sure they even know what it is. They suggest uber all the time, and it's clear Uber has massively more market share.
And when the unsustainable "subsidized growth" period ends, Lyft will be the new word on the street. It's not exactly a high barrier to entry to hear about and install a new app in this day and age.
If your reasoning is entirely anecdata, there's really no point in you engaging in threads about where businesses are going, since you'd only ever have something to contribute after it already happened.
Have you not been paying attention to Uber? They've been leaking funds like a sieve. Settlements, advertising, more employees, generally more aggressive and expensive tactics.
That 'growth' has included subsidizing rides, so their userbase once the 'growth' levels off will look radically different - likely diminished - from now.
Obviously in larger cities the taxi model can and does thrive, but as Uber's price goes up, more frugal users comfortable with installing new apps will likely move to other platforms that offer the same basic service minus massive investor pockets to fill, while others might use it as a niche transport service for longer-distance ridesharing or as one of several taxi services in cities.
Autonomous could save the margins there, but imo it's another front that Uber won't be able to afford fighting. Once the subsidizing ends, there'll be no love lost between Uber and users eager/happy to stick it to Kalanick and save a few bucks in the process, nor drivers who might've felt slighted/affronted by his or Uber's treatment of them, nor employees/users who don't care for the company's culture.
Time's running out for Uber; whether or not it survives as a big fish basically comes down to how soon autonomous goes mainstream.
Yea, autonomous has no bearing on the market. If it becomes a thing Uber will just go autonomous.
In the meantime people won't switch because of branding. They will already have Uber on their phone and be comfortable with it. It will take a lot to get people to switch. Branding is a huge competitive advantage. Better colas than Coke have been developed for a hundred years and they still grew market share.
Uber will get market rates, whatever they are and will make tons of money because their business model is super efficient. It should only cost pennies to dispatch each ride, they get dollars in revenue from each ride, and are developing huge economies of scale cab dispatch companies have never had.
As soon as they stop investing so heavily on opening new markets and businesses their income statement is going to look a whole lot different.
The problem is market maturity. If Uber is currently facing a quickly maturing market, the upside is limited. Investing in growth is much different than investing in diversification. For example, Google's ad-click market is completely mature, there is very little new growth there. So all their investments are in something new to add to their revenue pipeline, whether that will be AR or autonomous technologies. The fact that Uber is already seeing a loss of market share indicates that market maturity is fast approaching. How much of their investment is simply protectionism to maintain market share rather than growth?
Your assuming their ridesharing business is not profitable in mature markets. There is evidence it is. No outside analysis has yet been able to break down how much of their losses are investment in new businesses and markets.
Obviously it's big enough for both taxis and (whatever splitting rides long-distance is called, if not also ridesharing) to have continued to exist, but in general I agree with you. Uber's ubiquitousness in this day and age has less to do with a high unmet demand for people using cars to get places, and more for demand to get to places cheaply.
There's definitely a niche, but it's nowhere near the size that Uber's operating at now; so if they're reliant on that volume or higher for the margin they need they're in for some bad news. Once the price goes up the market will be ripe for new public transportation efforts and less-VC-saddled competitors to fill the void.
I dunno, maybe they'll have more luck in foreign markets. (Though last I read, that wasn't the case either...)
Uber is too young for the phrase "biggest crisis in its history". It has no history. It has none of the institutional depth to warrant such comparisons. That comes only after decades, after a company has survived multiple boom and bust cycles spanning multiple administrations. This is an upstart company run by upstart kids. That isn't bad per se, but we should expect unpredictability. Talk about company history when the CEO is in his 70s, is the child of a former board member, and the head office has become a listed building. Those companies won't grow massively every quarter, but they do know how to weather a storm.
I suspect management quitting has to do more with options being deep in the money and no longer having a financial incentive to stay with the company, more than Uber actually being in much trouble. Sounds like more alarmism. Uber has gotten a lot of bad press over the past few months but the business itself is doing fine.
IMHO as a part-time Uber driver, Uber could fix a lot of their current problems by putting tipping into the app. The self-driving car is not here yet, and Uber does not do enough for its drivers. If they would just add tipping I think that better drivers in better cars would start driving again. Without the tips, it's just not worth it.
No thanks! If drivers need to be compensated better, I would suggest increasing the fare or Uber taking a smaller cut. A lot of people prefer Uber just so they don't have to deal with tipping like in traditional cabs.
The article is talking about a different thing. If the trip costs me $10, the driver keeps ~$7 and Uber gets $3. If the driver thinks he needs $9 for this to be viable, then Uber should either take $1 or charge the customer $12 and pay the driver $9 is my point. I don't want the additional $2 to be covered by tips, which is determined by an unspoken rule.
But right now Uber is actually subsidizing your ride, so you pay $10, the driver gets $20 and Uber's "cut" is -$10. On top of that Uber does have expenses of their own so Uber loses $15 total.
The only way this works over the long term is to force out competition so that they can massively jack up prices, and/or replace drivers with self-driving cars that have lower costs.
Right, so make my cost $15 and pay the driver $25 and Uber still loses $15. I'm okay with that if that means I and the driver don't have to stress out about the tip before each ride. I don't want to be responsible for the driver making living wage when I don't employ him.
If Uber does this and they realize customers are not riding as much anymore, then it is a problem with their pricing and setting of expectation.
Then Uber should raise their rates - as it is, they take a greater cut of the fare than Lyft, charge less than Lyft, and don't offer tipping (which is always optional). This is a worse deal for the drivers overall from what drivers on both Uber and Lyft tell me, which is why I don't understand the tipping argument for when it comes to specifically using Uber or Lyft.
From what I've heard from drivers, lyft pays a bit more but pays less in incentives, uber pays less base but pays a bunch through incentives, and they tend to get pings more.
I think most people hate tipping because they hate when people ask for tips. But a formal tipping system might reduce the number of Uber drivers who already ask for tips.
I hate tipping because the rules are arbitrary, random, and unspoken. I have a few friends who work as servers in restaurants: anecdote, but they view anything under 20% of the bill total (including tax) as a "bad tip". This is partially because credit card receipts only include the total, not the tax separated out. So really, anything under around 22% is a bad tip.
I tip 22% for full service, 10% for partial. If I go to the bar, I tip 10%, or a dollar/drink if I'm paying cash. If I'm ordering takeaway somewhere, I tip around 5%. I have no idea which of these are reasonable or not, because there is no "tipping class". I have no idea if places I regularly go like to spit in my food because I tip like shit.
The credit card receipt shows 1 total: food+tax. So the amount the server is basing the tip off is higher than what I am. So for me to tip what they think is 20%, I have to tip what I think is 22%.
People almost never ask for tips. I think people hate tipling because it severely complicates what should be a simple situation, and makes honest people feel like they're being taken advantage of since assholes can tip less or not at all with no repercussions.
If I wanted to help someone out I would give them money. However I'm not getting into a car hoping to hear the story of why this person needs money beyond what I'm already paying for their service.
Or they could just raise the driver's share slightly, which would have the same impact on drivers, riders, and the company alike... without adding the unnecessary friction/confusion of tipping amounts and customs.
Tipping is why I won't drive Lyft. Uber is st least honest in that regard, tell me how much the ride costs, don't underquote and expect me to give the driver a bonus for providing the service you agreed to provide.
I don't think a lack of drivers is really a problem for Uber, at least not in major cities. Plenty of people are willing to drive for Uber currently, despite the bad publicity.
>Two questions face the company. One is whether Uber will continue prospering under Mr Kalanick’s leadership. Silicon Valley and its denizens may celebrate his type, but ...
Well fuck you too, Economist. That seems like an unnecessary and ignorant jab.
"Though the most successful founders are usually good people, they tend to have a piratical gleam in their eye. They're not Goody Two-Shoes type good. Morally, they care about getting the big questions right, but not about observing proprieties. That's why I'd use the word naughty rather than evil. They delight in breaking rules, but not rules that matter." -Paul Graham in "What We Look for in Founders"
Yeah there's a sense, but a bunch of the negative stories about Uber/Kalanick have originated in our community too. Would Susan Fowler's story have gone viral had it not been for the outrage within Silicon Valley? Including "Silicon Valley and its denizens" includes a giant group of people who have been crying out against this behavior.
I suppose I just don't like the insinuation that I (or my part of the Silicon Valley community) support that behavior.
Honestly, how many other companies, government agencies, or other organizations would hold up under the kind of coordinated, orchestrated drubbing that the media has dished out to Uber over the last couple of months?
Uber is a glorified cab dispatch organization, desperately fishing around to try to convert some of the insane valuation they enjoy into something more valuable. For years the media has made Uber their darling -- the oft restated misnomer about a "sharing economy" -- giving it what would likely calculate to billions in free press. Retelling the tales about the grand new world for drivers, with endless riches. The new standards of excellence for passengers.
So now the bad parts are the narrative. To dredge up another trite saying, live by the sword die by the sword.
The potential of Uber is a worldwide brand with super efficient dispatch. Do you really think it costs them more than a few cents to dispatch rides? There isn't any cab dispatcher in the world with remotely their economies of scale.
The economy of scale is a ruse that doesn't actually exist in the business, and this is very well tread ground so I'm not going to repeat it. For Uber's amazing efficiency, despite not owning the cars, paying for the fuel or normal labor costs, or even the insurance in most cases, and then taking 20% of the fare....they're losing insane amounts of money. The calculation doesn't seem to work out.
But in the end you've literally said that Uber isn't a cab dispatcher, but they're a super efficient cab dispatcher. Aside from that not being remotely true (their economics are absolutely abysmal), being a worldwide brand is close to meaningless. The overwhelming majority of rides happen locally.
Uber's primary beachhead has been a complete disregard for regulations. This may be justified in many cases, but it led to the corporate culture that is now eating it from the inside.
Sigh. There is no "coordinated, orchestrated" campaign against Uber by the media. The media will pretty much pounce on any story they are given, provided it checks out.
This pattern of stories about Uber is very familiar and very predictable. It starts with a single, note-worthy story. Based on the reception of that story, other employees (former or current) are emboldened to leak information of their own to the media/write their own blog post/etc. That story feeds another leak, and so on, and so forth. At this point I don't doubt for a second that numerous people inside Uber want Travis gone, and consider the short term bad press to be worth it in order to achieve that goal.
There's no conspiracy here. Just the media reporting things they are told by people in the know. If there were other ways to get rid of Travis (more diverse stock ownership, or, dare I say the word: unions) people would probably go for that route. But when you shut all that off your employees will use the press as a last-resort pressure release valve.
How has it been coordinated? Most of these things, like worker harassment which was reported on twice, once perpetrated by a childish CEO who is still in charge, is self inflicted. Travis didn't have to join Trump's Tech Advisory Committee either, that was a choice he made.
> Around twenty people signed on to Trump's advisory committee, many of them very well-known figures in the tech and manufacturing industries.
How many others, besides Kalanick, can you name off the top of your head?
Given the volume of comments mentioning their role in the committee I've seen on HN, I'd say that HN users are probably at least as likely to know about Elon Musk being on the committee (and unlike Kalanick, staying on it.)
And Musk and Kalanick are the two that have been high profile media figures as part of startup media strategy; most of the rest are big blue-chip finance and manufacturing CEO, who despite leading more powerful firms, normally have lower media profiles.
Musk has gotten quite a bit of flack (in general and on HN specifically) about it; now, unlike Kalanick, he defended the decision and stick with it rather than resigning on the eve of the first meeting.
Now, Kalanick actually managed to draw more attention by creating additional news by his dramatic resignation, but as far as criticism of the initial decision, I don't see any evidence he was treated differently than Musk; often, the two were mentioned together in both news articles and criticism.
OK, so let's say Musk and Kalanick have received a similar amount of flak for associating themselves with the Trump committee. First, that's not even remotely true (and no, I can't be bothered to perform a statistical survey, at least not for free); and second, it would obviously be counterproductive for qualified industry figures to turn down an opportunity to make their voices heard in government, regardless of any other controversies the President may be embroiled in at the moment. Criticizing people merely for taking an interest in their government's policymaking process is absurd.
So. What about the other 18 members? Why isn't anyone on HN or elsewhere attacking them?
> Why isn't anyone on HN or elsewhere attacking them?
HN specifically has a tech-industry-startup focus, plus the other people are exactly the kind of people you'd expect to be supporting an authoritarian corporate plutocrat. Their role is a dog-bites-rabbit story.
I haven't used Uber since about the third crisis of their own making. Even if it IS a coordinated attack, they launched it themselves, and plenty of folks turned away from the service before the media had a chance to finish their conspiracy plans.
You say that as if Uber didn't have it coming, or that it's not Uber's fault. Every single thing that has come up is a direct result of Uber's actions and culture, things that the CEO is ultimately responsible for.
I think a lot of people have always had a negative view of Travis Kalanick and Uber's business practices, but they enjoyed the convenience of the service just enough to look the other way. Between the soaring valuation and recent events, that balance has shifted to the point where some people now refuse to use the service. At the same time, there is a lot of schadenfreude by people who disagree either with the valuation, or Travis Kalanick and the company's ethos. The media is just tapping into this interest with their coverage, as is their nature to do. So if anything, I'd say it's more like karmic retribution than a coordinated smear campaign.
I think there may be a disconnect between the "a lot of people" I'm referring to, and who you may have in mind. I'm referring to people at large who are aware enough of technology to follow who Uber is, and observed their business practices and Kalanick's predilection for libertarianism. You would seem to be referring to a much more select demographic, such as those who would have been in attendance at Startup School.
The comment was "I think a lot of people have always had a negative view of Travis Kalanick and Uber's business practices, but they enjoyed the convenience of the service just enough to look the other way."
It's not a smear campaign; it's a feeding frenzy. When public perception shifts one way or another, the stories follow to cover it in that angle (though you'd expect at some point there'd be some contrarian hot takes that take an apologist stance towards Uber, maybe something like "Don't blame Uber. Blame the tech industry/gig economy/etc."). There's something rotten at the company, so journalists will naturally shift to cover it and dig up every juice piece of mud they can rake.
Same thing happened to RIM a few years back. None of this is personal. It's just a domino effect.
And you can find hundreds of CEO's with the same characteristics.
I hate uber for breaking the laws and calling it disruption, but obviously media smells the blood and this attack gets s lot of attention and pageviews so they keep pouring the oil to fire.
Good. I'm tired of there being so many positive feedback loops for individuals and companies practicing bad/malicious ethics, and/or failing at even the most basic compassion/egalitarianism.
> If Mr Gurley and the rest of the board cannot find an experienced candidate willing to work with Mr Kalanick, calls for him to step down may grow louder. But that is his decision to take. Uber is a prominent example of founders’ power at fast-growing tech firms. On its own, Uber’s board does not have the clout to change the CEO, because of his super-voting shares and those of his co-founder, Garrett Camp: together they control a majority of the voting stock.
Well, that's a pretty bad corporate governance problem. The CEO's behavior, and the culture he created at the company, have badly damaged the company's image and driven away senior executives and probably a lot of engineers too -- and yet the board can't get rid of him.
I would certainly think twice about investing in a company whose board is powerless to do anything about such a terrible self-inflicted wound.