Uber strips power from ousted CEO Travis Kalanick

http://money.cnn.com/2017/10/03/technology/business/uber-board-kalanick/index.html

by empressplay • 9 years ago

83 37 9 years ago

money.cnn.com

swampthinker• 9 years ago

17 person board. Are there other examples of startups that have been taken over like this with a successful outcome?

toomuchtodo• 9 years ago

Lots of examples of investors succeeding in diluting a founder's power in their own startup.

One person's takeover is another person's power restructuring.

EDIT: Tesla is a good example (Elon Musk pushing Martin Eberhard out).

alexandercrohde• 9 years ago

The question was are there any that are successful for the startup [longterm]?

uiri• 9 years ago

Apple is an example that comes to mind although the outcome isn't exactly successful. They nearly went bankrupt before they acquired NeXT to bring back Jobs.

lettergram2• 9 years ago

I think we're heading for a massive bubble, if Uber collapses investors everywhere will be spooked, "too big to fail" comes to mind.

Every ride Uber loses money. If they raise prices, then people jump ship, to Lyft, to a local service, to taxis. If self-driving cars don't start being used they can't cut down the cost... Of course, they also have lawsuits hitting them, and the Waymo lawsuit pretty much halted their self-driving car program.

Combine all this with the ridiculous number of lawsuits, investigations and criminal proceedings outside of IP that they are facing ("Grey ball" for instance) and I just don't see how they can maintain their status. Even with another $1 Billion or $10 billion.

How can they come out of this?

Couple that with having a large number of "chefs in the kitchen" so to speak and well... you get the idea.

FLUX-YOU• 9 years ago

I think we're heading for a massive bubble, if Uber collapses investors everywhere will be spooked, "too big to fail" comes to mind.

I don't think a company that's had a ton of controversy around it is going to suddenly spook everyone if it fails.

I would expect an Uber failure to already be priced into the market.

ellius• 9 years ago

I think the bigger spook will be if the entire market for on-demand drivers suffers a big decline in demand. Izabella Kaminska of the Financial Times has written several articles arguing that the Uber / Lyft model is fundamentally uneconomic. Without arguing for or against her, if that turns out to be true you are going to terrify a large number of investors. Nothing else has really looked as much like a sure-thing disruption opportunity as the taxi market. Anecdotally, my most recent Lyft driver recently told me that Lyft has started playing a lot of the same games to shaft drivers that she left Uber to get away from. It does make me start to wonder if the entire thing is largely subsidized by a market flooded with cheap money.

aetherson• 9 years ago

I don't see any real sign that the Waymo lawsuit halted their self-driving car program. It may yet, but so far, what it's forced them to do is "fire Levandowski."

I do think it was always ridiculous to imagine that Uber would create a durable advantage in driverless cars.

For better or for worse, Uber is the paramount example of the post-social-media dominated tech startup scene. If it turns out to be massively overvalued, I think you're right that it will absolutely spook investment in tech. Everyone's going to be asking, "If these investors were so massively wrong on Uber, after dumping billions and billions into it, how much insight could they possibly have?"

I don't know that that will mean a tech "bubble" or collapse, but I think it'll be way harder to raise money in tech for a while if Uber's ultimate valuation is, say, south of $10B.

overcast• 9 years ago

I don't see how Uber is considered "too big to fail". They aren't the banking system, they are a ride hailing app. If they go away, people go back to using cabs.

lettergram2• 9 years ago

I don't mean in that sense. In my mind, investors are having to deal with the sunk cost falicy. Every investor is bringing more investors in, which will drag everyone down.

gaius• 9 years ago

One ride from another app, and people will forget Uber ever existed.

tosstossy• 9 years ago

I think you're reading tea leaves, trying to create industry meaning where it's quite obviously a pathological case of Uber's leadership being scumbags.

nikcub• 9 years ago

Every ride Uber loses money.

That isn't true - they're profitable in a lot of markets[0]. They're subsidizing rides in new and developing cities where they're capturing market

[0] https://www.businessinsider.com.au/uber-profitable-in-hundre...

keithwhor3• 9 years ago

I don't know whether it's real or imagined, but there has been a drop in my subjective experience with Uber in the last few months since Travis's removal.

- While in a rush, I've had back-to-back mid-day waits of 15+ minutes for any and every Uber I called (hailed a cab instead).

- A day where I experienced $50+ non-surged fare estimate from downtown SF to the Sunset, something I've never seen before (usually $22-ish... I took MUNI.)

- Increased rate of bad driver behavior: I've had drivers straight up cancel calls if I'm not outside immediately, drivers start a fare before I get in the car (and then lose the ability to find my true pickup point), and worse.

- Inability to pinpoint my location when there's a conference or venue nearby - I had to call a Lyft yesterday because Uber insisted I was at an Oracle conference (I wasn't even that close)

And more. Pretty much every reason I've had for not taking cabs over the past few years is now becoming a problem with Uber. If they can't regulate the quality of their service, there's no benefit to Uber in a major urban center (hailing a cab is far, far faster).

I hadn't used Lyft in three years until about two weeks ago. I've started using it more frequently and have had a fantastic experience. I'm unbelievably disappointed - internal company politics aside, I had been a huge fan of Uber. I haven't fully converted to Lyft yet, but every experience I have continues to push me in that direction.

CoolGuySteve• 9 years ago

When talking to lyft drivers here in New York, they all drive for Uber exactly as long as it takes to pay off their car loan for that day and then switch to Lyft because it pays more.

So I wouldn't be surprised if Uber is a lemon market when it comes to drivers.

SerLava• 9 years ago

I'm confused by that. Why do they drive for Uber for part of the day if Lyft pays more?

JamesBarney• 9 years ago

Yeah I've had a similar experience.

A year and a half ago a driver didn't pick me up, so I asked for a refund and got it immediately.

A couple months ago a driver pretended to pick me up. I couldn't cancel because I was "in" the Uber. So my friends waited on me for an hour. Then when I requested a refund they wouldn't give me one.

This was even though the ride was $9, I'd spent $200 on Uber in the previous month, it was only my second time requesting a refund, and my GPS would have validated my story.

I've since then only used Lyft.

moftz• 9 years ago

Sounds more like there is more demand of rides than there are drivers. Whether that's from less people driving or more people riding is the question. Maybe Lyft is starting to become more popular. In my area, Lyft wasn't popular at all for a long time. You would wait forever meanwhile there was always an Uber driver in the next neighborhood. Now, they are pretty much the same in experience, wait times, and prices. Only time I've ever had "bad" drivers are when they call me before pickup and ask me where I'm going and demand I cancel since my destination would take them too long which I somewhat understand. There should be some sort of system to help drivers limit the amount of non-fare driving (giving them fares that might be a little further away to pickup but the drop off is right near the driver's home, kind of like pooling where the driver's home is the last "drop off").

I think both companies need to make sure that their drivers are happy. There will always be a demand for cab services so making sure you can keep drivers to match the demand will keep the fares coming in.

keithwhor3• 9 years ago

Only time I've ever had "bad" drivers are when they call me before pickup and ask me where I'm going and demand I cancel since my destination would take them too long which I somewhat understand.

You understand this!? What? I haven't experienced this (thankfully), but this is ridiculous. This is the kind of behavior I experienced from cabs the led me to be an Uber evangelist to begin with. -20C, downtown Toronto, 2AM, cabs (illegally) outright refusing to drive you because they want to go a different direction. Uber was a godsend in comparison, at the time.

If that behavior is making its way onto these platforms, I have to wonder whether the initial innovations in safety and value for the consumer are just getting absorbed and destroyed by the scale at which these companies have to operate (lack of ability to regulate and vet their drivers).

axus• 9 years ago

Uber could add an option to specify your destination, and provide the information (or lack of info) to the drivers.

jbob2000• 9 years ago

This is just the Uber market normalizing. Cabbies normalized a long time ago and we got: aggressive driving, taking the long route to jack up the fare, claiming the card terminal is broken to get cash, denying a ride if you're black/latino.

Take your pick!

nemo44x• 9 years ago

- A day where I experienced $50+ non-surged fare estimate from downtown SF to the Sunset, something I've never seen before (usually $22-ish... I took MUNI.)

I agree in my personal subjective experience.

They recently estimated a fare for me at $50 for something that was usually about $17 - there was no surge going on - at least they didn't say there was. It was not a typically busy time either. I hailed a cab and the meter read $21 when I got home.

And yes, I'm aware that they changed how they tell you a surge is going on and there was no "Fares are higher because of demand" message.

pen2l• 9 years ago

For me, it's getting better and better.

And by better, I mean cheaper.

I always buy the uber "passes". So for 20$ a month, you get unlimited rides that are first $5 free. In Boston, I basically go get a meal, park my car, etc. all around the city for free. Just today I dropped off the car at an autoshop and Uber'ed my way to work... how much did it cost me? $0.21. Usually when I'm at work I'm hopping here and there, just a couple of miles -- it's almost always free for me. The wait-time is never more than 5 minutes. It's completely unbelievable. I will be sad when these deals go away.

I do feel shitty though that drivers get paid crap... I rationalize my taking advantage of the system by convincing myself that I will stop when I'm in a financially better health myself and will start leaving big tips (I'm in academia, I'm pretty sure I get paid less than they drivers overall).

Oh, and Lyft is ALWAYS more expensive. I used to check prices for both when I needed to go somewhere... since Uber was always cheaper (and that's leaving Pass discounts asides), I actually uninstalled Lyft app a month ago.

moomin• 9 years ago

I think the most remarkable thing here is that Benchmark voluntarily gave up their own weighted voting rights. It tells you just how bad they think Kalanick's influence is that they think they're better off this way.

Uber strips power from ousted CEO Travis Kalanick

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