Ubered – The Uber Board Has Been On Autopilot


… maybe they were an experiment for those cars that they keep talking about? If so it doesn’t auger well.

I have long argued that no matter what a corporation talks about on its web-site, in its annual report,collateral, presentations … everywhere you look — when it comes down to it — a corporations job is to ‘maximize shareholder value’.

And what that means, no matter how it is disguised, is that it does not matter what Customers, People, Employees, Governments et al think. In fact the cynic inside of me believes that it doesn’t even matter what laws are broken (provided they think they can get away with it and are making money).

Over the last 24 hours, I have seen, read and heard a lot about the ousting of Travis Kalanick from Uber and it is to say the least, disquieting. If I were to aggregate the commentary into a single exchange, it would be this dialogue yesterday between Steve Inskeep and Uri Belriner on NPR.

The scene setter …

Kalanick reportedly agreed to resign after a shareholder revolt and scandals involving the workplace environment.

A dialogue from the extract

INSKEEP: So what made it clear that the man at the top had to go?

BERLINER: Well, what happened was big-time investors — major Silicon Valley venture capitalists — decided that it was time for him to go. These investors have huge stakes in Uber. Uber is valued at nearly $70 billion, making it the most highly-valued private company in America.

INSKEEP: So they just saw him as a risk to their investment?

BERLINER: Clearly, yeah. I mean, he — so much trouble at this company, and the man at the top was connected to so much of it.

In summary ..

… so they saw him as a risk to their investment and he had to go?

… yeah

But, But, But …

There were so many early warning signs. So many ..

.. Susan Fowler’s blog post in February of this year, which lead to …

.. an open letter to the Uber Board and Investors from Mitch and Freada Kapor just four days later.

.. being banned by cities, and in some place countries, all over the world.

.. hundreds of thousands of people deleting the Uber app.

.. being used to aid drug trafficking.

.. Google suing them over a claim that one of the Uber engineers (now fired — but the case continues) stole its self-driving car secrets.

.. being investigated by federal authorities over ‘Greyball’ — a tool it used to evade regulators.

.. Travis on video losing his cool — ‘bigly’- with one of his own drivers.

.. ‘accidentally’ not paying drivers in New York.

.. arguing that they are above the law when it comes to complying with local law. Remember when they pulled out of Austin because Austin insisted that Uber should comply with their laws and drivers should be finger printed. So toys were thrown out of the pram and ‘they walked’, returning a year later after lobbying the State for what they deemed was their right to do business on their terms and Austin’s laws were essentially quashed.

.. losing money at an ‘improved’ rate of 700 Million dollars last quarter (it was just shy of a billion dollars the previous quarter).

.. and in London (just to focus on one city) ..

.. where they still have the finest Taxi service in the world despite being attacked at every level by Uber, because only total destruction of the service was good enough for Travis and his henchmen . Take a stroll through this site to get a picture of what those fine people have been fighting.

Where Uber drivers …

.. have had to be warned that “sexual contact” with passengers is not allowed. (I kid you not).

.. are illegally ‘plying for hire’.

.. are involved in untold accidents on the streets, often because they ignore the rules of the road. (Little things like one way streets or drivers that are just so self-centered an unaware that of their surrounding that they don’t even use their driving mirrors.)

.. are arrested for carrying drugs

And Taxi drivers, note TAXI drivers [In London (I think like New York) a Taxi is a very specific vehicle that has a legal definition and is not the same as a mini cab] are reduced to pointing out the obvious to Sadiq Khan (the Mayor) who is now trying to unravel the chummy connections Uber has had in the UK with people like David Cameroon (sic) and Boris Johnson. And as he sets out to do that, Uber has the gall to criticise him for ‘favoring’ London’s black cabs.

… but I digress. The key here is that none of this is new. This has been going on for years. And it’s been reported on, but all ignored. Consider, outside of the tech/SF community, how many people know this story from 2014?

By the way, in that same year a young woman was raped in India by an Uber driver, she is now suing Uber … not over the rape .. that is already done and dusted. This time she is suing over how Uber Executives not only had access to her medical records but were actively and routinely sharing said records amongst themselves.

As a side note … interesting to read in that article that …

Critics condemned Uber over its screening practices when it emerged that the driver had previously been detained for months on suspicion of rape in a different case.

… think about that when you consider the argument that Austin had (see above) and which the State of Texas essentially quashed..

And the importance of that rape to Uber? Nothing. It wasn’t the rape they were concerned about. They were concerned that as a result of that rape, that they were banned from operating in Delhi which they in turn believed was part of an eleborate plan by their Indian competitor Ola.

Aaah yes. Taking a company down by very shady tactics. Uber knows all about that. This link takes you to the story about how they systematically set out to destroy Lyft back in 2014.

No — none of that and so much more has mattered … until ‘the driver’ in the ‘Autopilot Board’ suddenly woke up and recognized that this actually might be bad for shareholders .. ie them.

The problem is that it might be just a tad too late. And — I have to say, if that turns out to be the case, I have but one reaction …



But don’t fell sorry for Travis. He hasn’t really gone. He retains some 10% of the company, his seat on the board and he will likely continue his personal share buy back program as well as his vote counting for 10 times any other vote.Meanwhile Bill Gurley has resigned , seemingly at the request of Travis. So as the board now seeks a new CEO and in turn COO, CFO, SVP Engineering and General Counsel, consider that when they ‘sit at the table’ Travis will be there. I wish them luck with their search.

Finally, I notice this morning that amongst the opinions in the media about who should be the new CEO, Sheryl Sandberg’s name keeps coming up, along with Uber board member Huffington (amongst others), and I am reminded of the Glass Cliff.

One obvious reason for this resonance is that in the decade since we did our original research a large number of women have been promoted to prominent but precarious positions of leadership — women such as Angela Merkel and Julia Gillard. This was particularly true in the wake of the crises triggered by the 2007–8 financial meltdown when women such as Mary Barra, Marissa Mayer, Johanna Sigurdardottir, Ellen Pao, Jill Abramson, Janet Yellen, Theresa May, and Hillary Clinton came to the fore. Indeed, as Emily Peck recently observed in the Huffington Post, these are the women of the glass cliff generation.

Post Post Script

Just read this piece by Adam Townsend — loved his final line ….

Venture Capitalists gave (insert company name) billions of dollars with instructions to ‘fake it til you make it’. And they did and didn’t.


John Philpin
John Philpin
JOHN'S career spans 30 years, 2 continents, and organizations as diverse as Oracle, Citibank and GE. A Mathematics graduate, John moved to California in 1990. He helps technology companies create, develop and deliver their story for fund raising, market development and influencer programs. He also works with businesses to ensure they understand, and are ready, for the ever accelerating changes that technology is bringing to their industry. John is a co-founder of Expert Alumni and gleXnet and long before futurists and industry watchers were writing about the impending challenges that industries were going to be facing, they predicted a perfect storm of issues like skills gap, declining work forces, the gig economy, people trained to do work no longer needed, demographic shifts, economic and social change, market upheaval and rapidly changing ways of doing work. From the beginning they have promoted the idea that massive change was coming to how organizations should think about their workforce, with a singular focus on simplifying the interface between people and their work. Understanding the challenges ahead of the curve, the solution was built to arrive at a better understanding of the greatest restraint to business operations - competence, not capital. gleXnet provides unparalleled insights into an organizations people and operations by flipping the problem from the perspective of people, not the business.

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    • thanks for the link Chris … there are some at HBR that argue that it is nothing to do with calculated risk – and all to do with crime …

      A couple of quotes …

      “The company’s cultural dysfunction, it seems to me, stems from the very nature of the company’s competitive advantage: Uber’s business model is predicated on lawbreaking. And having grown through intentional illegality, Uber can’t easily pivot toward following the rules.”

      “With these savings, Uber seized a huge cost advantage over taxis and traditional car services. Uber’s lower costs brought lower prices to consumers, with resulting popularity and growth. But this use of noncommercial cars was unlawful from the start. In most jurisdictions, longstanding rules required all the protections described above, and no exception allowed what Uber envisioned. ”

      and if you want a long detailed analysis of all things uber – this link will take you to a 20 part breakdown of the company makes for a fascinating read …

    • I’ve worked at a lot of companies where I was involved in risk management. Some would do highly questionable things that really could be seen as unethical and not complying at all with the regulations of their industry. Some felt that just paying the consequences was worth accepting the risk to PR or stock price.

      Looks like Uber just didn’t not really consider their choices well. They had a lot of warning on these issues, so I’d be surprised if the CxOs didn’t have the conversation about all the things they’re doing would get them into some hot water.

    • and I am going to guess that those voices are owned by the people leaving Uber voluntarily – as opposed to being fired, Chris.

    • Most likely. And with a good severance too. The ethical side of me finds this distasteful. The psychological side of me says that big companies reward behaviors like these, so leadership and employees are not to blame. But, my legal side says our laws and our society is built on accountability. Some one needs to be held accountable.

    • but they never are – fines that don’t even get to the profits made from the corruption and nobody at the top ever sent to prison

    • and surely I get that everyone ‘pushes the envelope’ – but I think this was more than that – more akin to ‘stealing a distribution depot’ maybe?

    • I’m going to agree with both of you — that is, I think it’s both “risk management” and “criminality.” Partly because our prevailing corporate cultures are built upon the idea that “shareholder value” is the only responsibility, coupled with a legal structure that allows a body (corporate, government, whatever) to do pretty much what it wants that’s not clearly criminal until someone has the will and resources to stop them. And for someone like Uber, that may mean any regulatory effort will end up before SCOTUS if someone can manage to take them there — meantime they are filling their boots with little prospect of penalty.

      And yes, once you build your company upon lies and misrepresentation, why stop? Even in our small community in the middle of the Pacific, there are issues — — with vehicle safety, with driver safety, with insurance coverage — buy, hey, those are driver issues, not Uber issues, right?

    • As for someone taking all the way to SCOTUS – an equivalent of that already has happened in the UK – and the judges blinked … meanwhile, I think there is an increasing enough weight bearing down on Uber that they just might collapse under their own weight before that happens …