Travis Kalanick has given in to pressure and tendered his resignation as the head of Uber. He has been at the helm of one of tech’s most fascinating business stories since 2009 and now the company faces a total rebuild.
In the end, a blog post exposing the toxic bro culture at Uber was the catalyst for Kalanick’s departure, but the darling of the tech world has been under siege for some time.
Susan Fowler’s damning indictment of the culture at Uber went viral in a big way and the sordid details of harassment, sexism and painful mismanagement. “Reflecting On One Very, Very Strange Year at Uber,” went live on February 19th and it sparked an investigation that led to 20 terminations.
Attorney General Called in to Uber
Uber hired Attorney General Eric Holder to head the investigation and took it seriously. But there were too many complaints about inherent sexism and harassment in the workplace to conclude it was anything other than systemic.
Kalanick himself was filmed shouting at a driver in an argument over falling fares.
The new president, Jeff Jones, lasted less than a month before declaring that Uber just was not consistent with his values in March and the Head of PR left the company in April.
The New York times printed its own expose of a murky enterprise where discrimination, harassment and even threats of physical violence were the norm.
Uber CEO withdrew from presidential advisory board
Kalanick also stepped down from President Trump’s advisory board in February and, in hindsight, perhaps there was more to the story than a simple difference over immigration policy.
At the same time, Uber was being dragged through the mud thanks to hiring Waymo’s Anthony Levandowski. The engineer bought more than 700 files with him from Waymo and that sparked a lawsuit for infringement and theft.
Kalanick removed Levandowski from the self-driving project he had been brought in to head up and the company eventually fired him for ‘refusal to co-operate with the enquiry. But the damage was done. Now new court documents prove Kalanick knew about the Waymo information all along.
Waymo works with Lyft now
Not only has the episode impacted badly on Uber’s image, it also drove Waymo into the arms of Uber’s main rival, Lyft, and the two companies have struck a deal to work together.
Uber was the darling of the tech movement and did register $6.5 billion of turnover last year thanks to a presence in 58 countries. The dominant force in the ride-hailing market is still losing money at a frightening rate, though, and registered $2.8 billion of adjusted losses in 2016.
Investors weren’t happy with Kalanick
Tensions were clearly rising and several investors rounded on the CEO. Venture capitalists Mitch and Feada Kapor wrote an open letter addressing the ‘toxic patterns’ in the company.
The letter said:
“Uber’s outsize success in terms of growth of market share, revenues and valuation are impressive, but can never excuse a culture plagued by disrespect, exclusionary cliques, lack of diversity, and tolerance for bullying and harassment of every form”
Uber is about the enter the next phase of the ride-hailing story, with autonomous cars. Kalanick will have to watch this phase from afar.
The sexism row might have been the final nail in Kalanick’s coffin at Uber, but this is a row that has been brewing for a while.
Who will take over at Uber?
Now the company has to search for a Rockstar CEO that can come in and oversee a root and branch rebuild of the company’s image. They will also have to maintain Uber’s stratospheric growth and nobody should doubt Kalanick’s immense ability in that respect.
The company culture needs to change, but it needs to stay the course with technical innovation too.
It’s going to be a tough job and we expect to see a big-name appointment at Uber before long.
Youtube CEO Susan Wojcicki, Facebook COO Sheryl Sandberg and former Disney COO Thomas Staggs have all been linked with the role, but there’s no official news as yet.