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Following months of scandals, court cases, and a personal tragedy, the *New York Times*is reporting Uber CEO Travis Kalanick has resigned.
Mike Isaac at the Times claims Kalanick stepped down overnight from his position at the ride-sharing firm after a "shareholder revolt made it untenable for him to stay on at the company". At least five major investors including VC firm Benchmark, whose partner Bill Gurley sits on Uber’s board, made the demand for his resignation in a letter delivered to Kalanick, that was passed on to the Times.
The 40-year-old said last week he was planning to take an "indefinite leave of absence" from Uber, following the death of his mother in a boating accident.
Isaac's sources are said to be people familiar with the matter, but who wished to remain anonymous. Uber confirmed the reports when questioned by WIRED but did not comment further.
Kalanick is expected to remain on Uber's board of directors. The day-to-day management will fall to a committee of more than 10 executives as a replacement is sought, but Kalanick’s voting powers remain intact. The CEO already had significant control in the boardroom thanks to so-called ‘super-voting powers’. According to a Times article published earlier in June, these powers could have sprawled even further under a rule that sees any shares sold back to the company by employees pass voting rights straight back to Kalanick.
In a statement provided to WIRED, Kalanick said he would step aside for the good of the company so it can “go back to building rather than be distracted with another fight”.
And it has been one fight after another.
Kalanick co-founded the company in 2009, and its rapid growth has been coupled with bullish expansion tactics that saw it become as well known for irritating law enforcement and regulators, as for cheap rides. While, for a time, this could be perceived as Silicon Valley ego, confidence, or simply foresight that regulation would eventually catch up, in the past year the consequences of that carelessness has caught up, instead, with Uber. A series of investigations revealed: through a tool known as Greyball, Uber had been using app data to identify and avoid law enforcement officials since 2014, sending them ‘ghost vehicles’; between 2014 and 2016 Uber used another tool called Hell, to track Lyft drivers and identify drivers to poach. In December 2016 Uber’s self-driving test cars were pulled off the streets of San Francisco, after the company publicly ignored Californian officials’ demands for and attain a permit. Around about the same time, it was revealed that despite a $69 billion valuation, Uber had lost “significantly more” than $2.2 billion in the first nine months of 2016.
But none of these stark financial or ethical business issues propelled Kalanick to start meditating to be a better leader, or former attorney general Eric H Holder Jr to conduct a company-wide investigation, or the CEO to finally, after months of drama, step down. It was the revelations from within Uber’s own business culture that have been Kalanick’s undoing, kicked off by ex-Uber employee Susan Fowler’s February blog post detailing a culture of sexual harassment, gender bias and prejudicial behaviour at the company.
In the months that followed, senior vice president of engineering Amit Singhal resigned after it was discovered he had failed to tell Uber a sexual harassment allegation led to him leaving a previous job at Google, and more than 20 employees were fired following an internal investigation into the culture of harassment. The latter followed the discovery of 215 complaints relating to discrimination, sexual harassment and other allegations.
Uber executive Eric Alexander was fired on 7 June for mishandling the medical report of a woman who was raped by an Uber employee in India in 2014. According to anonymous sources, Alexander believed the claim of rape was part of a plan devised by rival ride-sharing firm Ola, and once he had obtained the medical records of the victim, he shared them with both Kalanick and Uber's SVP of business, Emil Michael, who has also subsequently stepped aside.
Last week the board went on to vote in favour of implementing all the measures recommended by the Holder report, including a leave of absence for Kalanick. But this did not prove sufficient. Incredibly, in a meeting to address the Holder report and the ongoing culture problem at Uber, board member David Bonderman suggested to Arianna Huffington that the only thing more women on the board would mean, is “it’s much more likely to be more talking”. He too has since resigned.
In February, when Fowler’s letter was already in the public sphere, Kalanick was recorded in an Uber arguing with a driver over fares. The video, it turns out, was an apt microcosm for how the CEO deals with strife, and the exchange was a prophetic one. In the video, the driver complains of falling prices, while Kalanick defends the tactics. A polite debate quickly falls apart when the driver suggests Kalanick has lost people’s trust, and in fact lost the driver $97,000 due to his investment in a car and Uber's falling prices. A brief exchange on figures, which saw Kalanick responding “bullshit” to every remark, led to the following:
Kalanick: You know what?
Fawzi Kamel: What?
Kalanick: Some people don't like to take responsibility for their own shit. They blame everything in their life on somebody else. Good luck.
Fawzi Kamel: Good luck to you, but I know you're not going to go far.
This article was originally published by WIRED UK
