Uber doesn't have a prayer of rehabilitation until Kalanick himself goes. The rot goes straight up to him. Jeff Jones was a much more recent acquisition who came from staid corporate America (Target) -- I don't think he was the problem.
The short tenure, job description, and his history makes this bit believable: "Jones determined that the situation at the company was more problematic than he realized."
Not sure if this update came before the HN share, but this is a very explosive statement from Jones:
“It is now clear, however, that the beliefs and approach to leadership that have guided my career are inconsistent with what I saw and experienced at Uber, and I can no longer continue as president of the ride sharing business."
It's dangerous to make predictions like that. We've seen worse companies last longer.
In the 2008 financial crisis, people from the bottom to the top committed outright fraud; swallowing up other banks whole (PNC bought National City for $5 billion; then got a $5 billion tax credit .. they bought National City for free .. NC wasn't allowed to apply for TARP).
Ford sold tank treads to Germany. IBM made punch cards for the SS. BP got the UK and US to remove the democratically elected leader of Iran and install a dictator. United Fruit and everything they did in South America
Wal-Mart is still around, and Amazon has turned into the new Wal-Mart. Uber could die tomorrow or last another 50 years. I don't think any of this is make or break.
I think the difference with those comparisons is that Uber is a massive startup, and startups have a high tendency to fail. Situations like Uber are the exact reason everyone was issuing warnings about "late stage private companies" last year. Uber might have lots cash on hand, but their unit economics makes them a ticking timebomb, meanwhile the constant PR is sending them into a huge tailspin.
Zenefits seems to have cleaned up with the departure of the former CEO. I'm not sure what their bankruptcy prospects were. Departure or not, I think Uber has challenges beyond their need to create self-driving cars (which the CEO claimed was existential for them).
i think the self driving car stuff is existential for uber because the drivers cost them too much money. it's a race against their ability to raise capital.
and yet Google is saying some of that software was stolen and there was that other recent post that showed their cars still needed a pretty large amount of driver intervention .. so that's probably not working out for them at the moment either.
correct. they've fucked themselves. i'm really curious what their financials look like, because i bet google has an approximation, and google may know that this lawsuit's costs will break the camel's back.
> You still haven't explained why it's dangerous to make this prediction,
In literally the second sentence of his response: "We've seen worse companies last longer."
Now, Uber's current combination of all its troubles does not paint a pretty picture, but a resignation of a top exec and a PR nightmare simultaneously aren't really things that would definitively sink a multi-billion dollar company.
You might be wrong, and make decisions based on that wrong decision. That's the context of the discussion.
Nobody is suggesting that you'll get bumped off by the Uber PR squad, just that you'll be caught making uninformed definitive statemnts about an uncertain situation.
The difference here is that Uber doesn't have much of value except their brand. Their industry has a low barrier to entry, their work force isn't tied to the company and they don't have much in the way of IP. Their ability to ride out bad press is a lot more limited than companies that can fall back on those things.
(well, they also have a giant pile of cash. But their ability to raise that cash is obviously dependent on what investors think of their brand)
...Who also made and make lots of money. I don't think that anyone is disputing that absolute scumbags can stay in power if they make people money, but Uber... loses... money.
On the contrary, their stock valuation is staggering. If it simply increases to eclipse normal companies they can burn all they like.
It's more than a bit like a tipping point for the moral soul of market capitalism (to the extent that's not already an oxymoron).
Basically Uber will continue to dominate so long as being a complete, total monster is MORE important than any other consideration. That's what's propping them up: their continued existence is an indication that, to global capital as it exists today, the various considerations of business all boil down to one single Darwinian consideration: what will make the most money, all else aside.
Uber is a vote for 'all else aside'. They're a vote for literally capital crushing everything else before it, for the belief that abstracted power (in the form of money) can always do anything it wants. In a sense it's a vote of confidence in the freest of free markets: as long as everybody continues to believe, logically Uber can never fail because they can always out-scumbag everybody else and if you're certain that's the key to success it's illogical to break faith with 'em. That doesn't mean 'liking' it: you can hate it and still believe that's the only way to success.
The one crack in the support beam: this literally requires everyone to agree, because the ONLY thing holding Uber up is the collective confidence in their valuation. They can only burn infinitely if they represent something vitally important to capital as a whole. This is why they're still Uber, and it's pretty revealing.
But it requires just about unanimous agreement that Uber is the way of the future. It doesn't take many defectors before Uber stops making the rules for being a unicorn darling trend-setter: and people do have a sense of what's at stake here. If Uber is NOT the future… then they lose a LOT of money.
Uber is the Enron model. They are incapable of crumbling, or dwindling. They can only be the way of the future and the one model for everyone going forward… or explode, very suddenly and catastrophically.
Wow, "very explosive" is putting it lightly. He could have very easily said something a little more sanguine, along the lines of "We had a difference of opinion, yada yada." The fact that he is trying to distance himself so strongly from Uber makes me think the stuff that will come out from the sexism investigation and Waymo lawsuit will be even more damaging than I thought.
My not-even-2-cent internet armchair prediction: one or more people will go to jail for the whole Levandowski affair.
It's an innocent mistake, but you've inverted the meaning of OP – he's agreeing with you (and saying this is a huge red flag for any experienced execs Uber might want to hire).
I would suggest it's unlikely he was part of the problem, given that Uber type behavior would never be tolerated at Target. That may be because of ethics, or it may be because they were sued into ethics; either way, not tolerated.
Burning bridges can be a boost to your reputation. Imagine the number 2 person at Enron left after six months at the job and made the same statement - they would have been hailed as a leader of excellent judgement and moral standing after the collapse.
The most likely thing that happened was that Jones said 'you go or I go' and that that ended with him going.
Without inside knowledge that's speculative but this is how these things usually play out when founders dig in against a new outsider.
The letter feels like spin to reduce the feeling of a fractured company towards the rest of the cadre. Not that they will be fooled (for long, anyway).
Anyway, it's Travis Kalanick's ship to sink if he so desires so Jones is right to leave, but if I were him I would not wait too long before coming to my senses. The Uber brand is starting to look damaged beyond repair and they still have not begun with the salvaging operation, things are only getting worse.
Well, those 'high performers' are a liability more than they are an asset at the moment so that would have been a very bad call. Uber is not exactly SpaceX and any 'high performers' that think they are so above the law that they get to destroy the company culture and cause a tsunami of bad press should be sacked pronto.
It all depends on what constitutes 'bad press' and the company culture. If the valuation of Uber is based on how much they are monsters with no consideration for anything else, none of this counts as bad press provided that Uber can still beat everything and everybody it's in conflict with.
Stealing ideas from Google? If they can't get away with it, that's catastrophic. If they DO get away with it that's a thumb in the eye to Google, much like their normal operations are a gutpunch to every legal system they're in conflict with.
The whole point is this: everything negative about Uber turns into a positive for their valuation if they can get away with it. I don't see any possible event or action that would break this rule. Travis Kalanick could eat babies on nationwide TV and it would help their valuation IF he got away with it, because it would be more grandstanding about how Uber is ultimately powerful and can always do anything it wants because of that power.
View any bad press in that light: are they getting away with it? If they are, it's more evidence they make the rules, and making the rules is why they're valued at Uber levels. If they are above any and all laws, the valuation is justified or undervalued.
Yeah. Sounds eerily similar to the story of a certain real estate developer turned politician.
It's a little bit like attempting to achieve escape velocity. If you succeed then everything is fine, but if you fall even a little bit short, it all comes crashing to the ground.
Only time will tell, but I'll be pulling (har har) for Team Gravity.
The comment you're replying to is referencing the same "high performer" reasoning cited by Susan Fowler. Probably not endorsing the practice, just noting it exists.
I agree. There's enough social awareness that people don't want to support a company run by jerks like Travis Kalanick. In an era with socially conscious consumers, integrity of leadership matters.
It is easy enough to switch to Lyft (I live in major metropolitan area) without any inconvenience. And the Lyft driver's I've talked with about all the controversy say they make more $$$ and are happier driving for Lyft.
FWIW, at least here in Sydney, the taxi people have significantly upped their game. The Silver Service app is close-to as good as the Uber one (at least from a rider's point of view, the drivers prefer the Uber app).
Another interesting thing I've noticed, my taxi trips for a few commonly used trips turn out to be occasionally cheaper, and rarely more than 5 or 10% more expensive than the Uber rides I used to use... (And that includes getting home at 1am on the nighttime surcharge rate here in Sydney...)
As a friend commented on Twitter recently: "it's pretty hard to make taxi owners look good - (not drivers, most drivers NOT owners) but Uber's making it happen"
And if you had asked your non-tech/internet obsessed friends what they thought of Uber a few years ago you would have gotten equally blank 'wtf is Uber?' stares. You may think that having the tech industry filled with antipathy towards Uber does not matter much, but those same techies are the ones who make decisions like 'what companies should we support via an API call in our app' or 'who should we partner with on our new service', and more importantly the 'whose recruiting offer should I consider' question. With Uber bleeding money from its unlicensed taxi business it needs to find any other opportunity it can, and having those doors just a little bit harder to open for the Uber bizdev & recruiting people will matter a lot more in the long-run than whether or not a non-techie decides to take an Uber home in middle America.
There is still the problem that without the competition that Uber provides, Lyft likely becomes a more typical company and begins increasing their margins in ways that customers and employees dislike.
Exceptionally low rates means the cars that are picking people up are not the quality of cars people want to be riding in, nor the quality of drivers they want to be riding with.
Uber is still the big dog in town, I doubt they'll disappear completely.
Also, if you listen to the Lyft founder talk about the company, he sounds like he actually wants to help the world. Not to say that they can't become a shitty corporation, but it seems less likely.
Lyft's valuation is still 1/10th of Uber's. I don't think we need to worry too much about Uber going under anytime in the near future. Uber still has another 10B in the bank. As a consumer, I am supporting Lyft so that they might live another day to keep the competition going
That's been my experience too - drivers like Lyft better, and Lyft doesn't seem to be run by assholes. I never actually deleted my Uber account, but I didn't bother to install the app when I bought a new phone; I don't feel like I'm missing out on anything.
As far as I'm concerned, the rot is pervasive.. Even the drivers. My ex girlfriend was riding an uber and the driver exposed himself. She complained to uber and they claimed they fired him but after the recent revelations, I don't trust that company at all.
