[close-up] Uber: expelled founder

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From New York

Liu Liping

Even if he announced an indefinite vacation, Travis Kalanick (hereinafter referred to as "TK") hopes to bring some good news to Uber.

During the vacation period from June 6th to June 20th, the 41-year-old Uber founder is still busy interviewing potential executives and discussing with some board members the company's safe and excessive solution.

Before the 20th, the top of these directors' schedules was: how to find a COO who can get along with TK. A source told Tencent Finance that the investor’s plan was to improve the senior management team with the help of TK. “The board will not give TK a strange team, and everything will be done in consultation with him. ”

However, the direction of the matter is turning at a big angle. On this day, Matt Cohler and Peter Fenton, two partners of Uber's major shareholder venture capital firm Benchmark, flew from Silicon Valley to Chicago to meet TK, and TK thought it was just another round of investors and themselves. Strategic discussion, said New York Times technology journalist Mike Isaac.

At 10 am this day, Cohler and Fenton presented a TK showdown at a hotel in downtown Chicago, including five major investors from Benchmark and mutual fund Fidelity, and prepared a resignation requesting TK on the same day. Sign the name on it.

TK's horror and anger vented through a red-faced quarrel. Mike Isaac said that TK's personality is radical and that his sword is a typical way of communication.

Uber, a model company that was also seen as a Silicon Valley a year ago, has been plagued by violent suspicions in the past six months, its corporate culture has been controversial, and its subversive founders were expelled overnight. The company's future is also beginning to enter the fog.

In the past month, Tencent Finance visited Uber's digital shareholders, key allies of TK's entrepreneurial period, founding team members, Uber middle-level and grassroots employees, and reunited the fission of the global star company on the cusp.

Investors raided "forced palace"

The forced resignation of Uber founder TK is not expected for most of the company's employees.

Board member Arianna Huffington has been a Uber spokesperson since Uber’s repeated negative news this year, and the media and investment industry’s female legends have loved TK. She became the last straw on TK's day. It is reported that TK was called "Meng Palace" and dialed the phone of Ms. Huffington.

But to his disappointment, Ms. Huffington told him that the investor’s advice was not necessarily considered.

In the past six months, when Uber was in a quagmire, the board of directors and investors were quite dissatisfied with Uber's top management and also “changed blood” through various means, but they have been firmly standing behind TK. It is this huge contrast between before and after that makes TK unbearable.

In the resignation issued at 10:30 in the middle of the night on June 20, TK wrote emotionally that Uber has been created for almost eight years without sleep, and now does not want to compete with the investors who forced him to resign. Instead, choose the best way to call Uber.

A Uber employee told Tencent Finance that TK is definitely the soul of the company, and his image is inseparable from the Uber brand. But some people think that Uber, who leads the unlisted company with a valuation of $70 billion, should have treated itself as a big listed company. David Yoffie, a professor of management at Harvard University, told Tencent Finance before TK resigned, maybe TK shouldn't return to the company. Managing a Fortune 500 company is very different from a startup.

A close person with TK told Tencent Finance that TK’s resignation was extremely reluctant. “TK is in a bad mood. He is in the sorrow of his mother’s death, which is a double blow for him.”

Even for many Uber insiders, the news of TK's resignation is unbelievable.

Uber senior consultant Bradley Tusk, who has been working with TK since 2011, smiled and said to Tencent Finance that the news of TK’s resignation was extremely complicated. “On the one hand, I understand that investors want Uber to have a new change. On the other hand, Uber loses such a pioneering leader, and I am afraid it will be hard to find someone who is comparable to it."

Just the day before TK announced his resignation, Tusk, who has close business with Uber, and his own office in Park Avenue, New York, outlined the future of TK that TK continues to lead the company out of the woods.

"The company's board of directors should now be rushing to form a new management team, and this is very difficult." After TK resigned, Tusk told Tencent Finance.

When Uber employees learned that TK resigned, they were also shocked. A Uber employee told Tencent Finance that most people think that TK's farewell is just a reorganization, so when I get the news, my heart is not a taste.

On June 7th, a week before TK announced his resignation, Tencent Finance saw everything as usual when visiting an office in Uber North America. The company has experienced too many ups and downs in the past six months, but for the employees who develop their business in the first line, the turmoil at the top of the company has not changed their daily work.

A Uber employee told Tencent Finance that in the operation of each group, everyone is still busy with their daily work as usual. "Uber is a big company. In specific business, TK has already given enough space to each business unit. Only At the company-level strategic decision, TK will take the final idea."

Tencent Finance has learned that Uber has promised employees in June that it will increase benefits, such as employees can work more at home, "is also a stable military."

TK's resignation is like a rock star's sudden curtain call, which makes everyone horrified, but also thinks about what Uber is doing.

Questioned "Uber Culture"

Uber's culture is conservatively controversial. The American people protested in front of the Uber headquarters and launched the "Remove Uber" campaign on social media.

TK is the soul of Uber. A Uber employee told Tencent Finance that although TK does not intervene in specific business, in the company, the status of TK is irreplaceable.

Managing Uber is undoubtedly an unprecedented challenge for TK. Although TK is a continuous entrepreneur, its last successful company has only 8 employees. And in 2009, Uber, founded by TK and two friends, is now a "big Mac" with 14,000 employees.

"Wolf culture" led Uber's rapid expansion, but also left the drawback of growing too fast.

Unlike other companies, Uber's corporate structure is very fragmented, with only 2,000 employees at its headquarters in San Francisco, and the rest scattered in other cities. There are many offices and many employees, and in the face of thousands of companies, Uber Personnel has only two HR staff in management.

In the company's rapid expansion, 40% of Uber leaders are the first to assume managerial positions. These world-class programmers need to continue learning and self-adjustment when they first assume management positions.

“Leading the team is different from completing the programming tasks. It also needs to check the working status of the team members and coordinate the internal contradictions. These are the programmers who have never touched before.” A Uber employee who worked in the leadership position told Tencent Finance, “ This is also a huge challenge for TK."

There are many friends in Uber's senior management who are TK's friends. "Some of them are not good at Uber's reputation. Their ability is not to say first. Some executives are ganging at the company, which makes others very disgusted." A Uber employee told Tencent Finance.

The CEO is like this, and other executives are also moving up. "No Silicon Valley company has so many Vietnamese people like Uber because we have a Vietnamese CTO," an employee told Tencent Finance. Although this kind of comment is inevitably biased, similar ideas exist in Uber.

At the beginning of the venture, Uber's "wolf culture" is full, employees work day and night, and TK's image in the hearts of employees is a derogatory and powerful leader. An early Uber employee recalled that in 2012, he worked for 48 hours in a row and was very tired. When he walked out of his office in San Francisco, he directly went to Uber to relax in Las Vegas, 7 hours away. The high Uber fare was naturally recorded in the company's account.

TK gave a lot of tolerance to similar events, and in the team, they were also outspoken about each other's problems. Just after having tens of thousands of employees, Uber headquarters will meet weekly meetings as usual, and each office will be remotely connected at the same time, and will have 30 minutes to ask all employees.

A Uber employee told Tencent Finance that there was a disagreement with the leadership and asked directly why TK did not give up the position of the CEO. When the media broke the news, TK had brought a group of executives to visit bars and find wine in Korea. The staff even asked the executives to ask the executives about the ins and outs of the matter.

On March 10, 2017, TK appeared in the conference room of Palo Alto in Silicon Valley. TK with iconic gray hair, wearing a casual dark blue crew neck shirt, on the stage for employees to analyze the recent problems of Uber, the advantages and disadvantages of the complex. However, in the conference room where it can accommodate hundreds of people, TK seems to be a man muttering.

Prior to this meeting, Uber had been continually taking the headlines because of negative news, and the outside world and the company were keeping an eye on the founder's words and deeds. In the speech, TK has a slightly relaxed tone, and even smiles with a smile to answer every question raised by the employee. The jokes thrown from time to time are full of laughter.

An employee asked, who is your most admired person? "Hamilton", TK replied.

Alexander Hamilton is an American soldier and one of the founding fathers. He is one of the drafters of the US Constitution and the first US Treasury Secretary. Hamilton is a New Indian islander who has been admitted to the Emperor College (now Columbia University) for donations from local people. Later, he became a soldier in the American War of Independence in the North War, and set up a great battle. After he was in charge of politics and was in charge of finances, he did not fear political dissent, set import tariffs, emphasized the potential of the federal government, gave the federal government the power to issue government bonds, and created controversial whisky consumption taxes, which were countless achievements that could go down in history. A visionary subversive.

TK is also a subversive. In the United States more than two hundred years later, technology and innovation have replaced the founding of the country, and war has become the main theme of this country. In just eight years, TK has deeply embraced the concept of software for car travel and subverted the tradition. The taxi industry has also allowed the sharing economy to take root in other industries. “Uber in certain industries” has become the next investment target for investors.

In 1804, Hamilton accepted the political battle between the left-wing and the American Vice President Aaron Burr (Jr). In the duel, Burr gave Hamilton a fatal shot, and Hamilton died at two o'clock the next morning.

A prophecy. The most admired Hamilton TK and the "duel" that once hailed his own investors, lost.

TK's "Wolfness" and Compromise

TK is the most compromised founder. He is good at continuing struggles, but this time no one knows if he can return.

Mark Cuban, owner of Uber's early investor NBA Dallas Mavericks, once said that TK's advantage is that it hits the south wall and turns over the wall to achieve its goal, and his achilles heel is also true.

TK, who has always given the impression of “radical and unrequited love”, is the founder who is the most compromised. At the staff meeting on March 10th, TK smiled and told about the story of being bargained by investors at the last moment of the last startup file sharing platform Red Swoosh.

In 2001, only six people, Red Swoosh with a debt of $200,000 finally won a financing treaty of $300,000 for investors, and on the second day of Thanksgiving, investors called TK and said, I still give You are 300,000, but I want 30% of the shares.

In the face of this unsuspecting lion's big mouth, TK replied almost without a pause for a second. "No problem, great."

TK said, I am afraid that the world is the most vulnerable to the negotiating table, but still achieve the goal. After the $300,000 payment, TK paid off the debt, and the other five people in the team worked for half a month, and TK remained unpaid. In 2007, Red Swoosh was acquired by Akamai Technologies for $19 million and TK successfully withdrew.

Two years later, TK created Uber. Angel investor Bradley Tusk can't forget the scene when he first saw TK. In 2011, when the US smartphone penetration rate was extremely low, TK told Bradley that "no one will buy a car in the future, nor will there be a driver. All trips are all at one click."

Tusk has been involved in Uber's siege in the United States almost at the earliest. He served as the deputy governor of Illinois and former New York City Mayor Bloomberg's 2009 campaign team manager, helping Uber resolve the difficult conflicts between regulators in several states. In particular, it was well known in 2015 and the Mayor of New York “hand in hand” to win.

“TK is far more practical than people think,” Tusk told Tencent Finance. “He knows when to take it.”

In the game between Uber and the regulator, the Taxi and Limousine Commission ("TLC"), TK has been extremely restrained.

Before 2015, TLC was also confident in the New York taxi license market. Uber's growth rate is staggering, and the license price of New York taxis has jumped from $1 million in the summer of 2014 to $690,000 in the summer of 2015. TLC's director Allan Fromberg told Tencent Finance that Uber not only transformed the taxi industry, but also changed our regulatory agencies. Uber has been actively exploring new borders with TLC.

The good cooperation between Uber and the New York regulator continued until the mayor of New York made a killer. At that time, Uber suffered setbacks in Europe and was also enemies on the east and west coasts of the United States. Uber, who had just been fined $7.3 million by the California government for "not providing passenger information as required," received the "ultimatum" of New York City Mayor Bill de Blasion (Bai Sihao) on July 22, "to curb Uber as soon as possible." increase".

Tusk told Tencent Finance that until this time, TK showed a tough side, which violated his bottom line, and in the end, with Bai Sihao's trick, Uber wins.

Uber used to be the darling of capital, the place where the top programmers yearn. In an early interview, TK said that in a financing event, he only introduced the situation of the company, and the investor handed in the check.

The sudden departure of TK is by no means a problem for a Uber company. In fact, this is a systemic flaw in Silicon Valley. From the perspective of investment environment, on the one hand, investors are too worried about killing another Steve Jobs. On the other hand, the founder-led companies like Facebook and Google have grown into technology giants. People have made concessions on TK's control over the company.

At the same time, too many private equity funds chase entrepreneurial projects, so that the founders have more room for manoeuvre, including the influence of Chinese capital. A well-known fund manager in Silicon Valley told Tencent Finance that he had withdrawn from the competition because of the conditions that Chinese venture capitalists gave to entrepreneurs. "This is not a virtuous circle."

From a regulatory perspective, the Title II regulation of the JOBS Act, which came into force in 2014, gives non-listed companies more room to finance. For the first time in nearly 80 years, private companies can publicize financing needs in a variety of formats, and before that, public financing was only the privilege of regulated companies. Startups then enjoy the privilege of being unregulated and financially swaying.

With the popularity of the sharing economy, the regulators have increased the tolerance of contractors who do not provide insurance and other guarantees, and also allows startups to do their best to reduce labor costs.

David Yoffie told Tencent Finance that Silicon Valley, which has experienced Uber's baptism, needs deeper self-reflection.

Uber's uncertain future

The main shareholders seem to be prepared for TK's forced palace. The persistent bad news has made this fast-growing giant company suffer a lot. This crisis is still the beginning of the company's decline or re-emergence.

Because TK and its buddy alliance have super voting rights stocks, and TK himself has no retreat, the outside world believes that TK will not be "imposed" by investors.

Uber currently has nearly one hundred investors, standing behind Matt Cohler and Peter Fenton, who are behind the "forcers", are five investment institutions with a quarter of Uber's shares and 40% of voting rights. Although there are rumors that TK and co-founders are also their allies Garett Camp and Ryan Graves, they have "majority" voting rights.

However, as a non-listed company, Tencent Finance is temporarily unable to know Uber's specific equity weight information.

A senior legal scholar told Tencent Finance that from the current information, the two sides did not seem to have reached the point where mandatory voting allowed TK to go out, but TK agreed to resign.

However, how many stories have happened during this period are currently unknown.

The legal scholar also pointed out that sometimes there may be some conditional agreements between the investor and the founder. When certain conditions are triggered, it may trigger some consequences that the founder needs to bear, or compensation specific. The amount, or the change in the proportion of voting rights.

"Although Arianna Huffington has always been a firm rear of TK, it does not rule out the possibility that Huffington has already formed an alliance with the five major investment institutions. This may also be a bargaining chip for TK's resignation. In short, the five come. The confessed institution should hold the chips in advance, otherwise it will not rush to make a request."

In this year's continuous Uber storm, Huffington has been a company spokesperson, replacing TK in most public places. On the one hand, TK originally invited Huffington to join the board, and it is intended to help Uber to shape the media image with his media identity. On the other hand, it is said that Huffington has basically assumed most of the CEO's responsibility in the past six months, so Huffington It may also be the CEO of Uber.

On Uber's list of candidates, there is also Susan Wojcicki, CEO of the online video platform Youtube, Angela Ahrendts, Apple's online retail vice president, Amy Hood, Microsoft's chief financial officer, and Jack Dorsey, co-founder of Twitter.

A person close to Uber executives told Tencent Finance that it is not difficult to find a professional manager to be a Uber CEO. Uber can offer the best conditions.

Although TK has resigned as Uber's CEO, he still retains his directorship and all voting rights and therefore still has the right to participate in the selection of successors.

An investor holding Uber stock told Tencent Finance that this year's stock was bearish due to negative news. In the private stock exchange, Uber's price fell by about 15%.

Undoubtedly, Uber's appeal is not as good as before. A number of programmers who joined the company two or three years ago told Tencent Finance that it was a pay cut and a job change to Uber. Now, Uber has encountered a "talent shortage." A Uber middle-level leader told Tencent Finance that since the end of last year, he wanted to expand his group, and half a year later, it was far from the original goal.

“I didn’t lower the standard because of the difficulty of recruiting. Uber’s working staff is quite high.” The middle manager told Tencent Finance, “Although the negative news in the past six months will cause some people to leave, overall, Uber’s departure The rate is within the normal range, even lower than other technology companies."

Uber's attraction to the capital market may not be declining. A Uber early investor told Tencent Finance that the capital market and the media and the public see the problem differently, the capital market is more rational, and the focus is on the company's financial report. And performance, is a digital game, and the media and the public may pay more attention to the company's explosions and stories. "Under the heavy trouble, early investors may accelerate the pace of Uber's listing."

In November 2016, TK had a long conversation with Arianna Huffington. At that time, Uber was still a role model for Silicon Valley. TK mentioned that he started running in the country when he was in elementary school. "When you run long distances, your test of endurance is your own endurance. When you sprint, no matter how tired you will always try your best."

Maybe TK was temporarily defeated in this fight, but as he said, in the end, the biggest enemy in the run is himself. Running, Uber is no different.