After months of turmoil surrounding the ride-hailing company, Travis Kalanick has resigned as CEO of Uber, the company he founded, after investors pressured him.
Mike Isaac of the New York Times had the news:
Mr. Kalanick’s exit came under pressure after hours of drama involving Uber’s investors, according to two people with knowledge of the situation, who asked to remain anonymous because the details were confidential.
Earlier on Tuesday, five of Uber’s major investors demanded that the chief executive resign immediately. The investors included one of Uber’s biggest shareholders, the venture capital firm Benchmark, which has one of its partners, Bill Gurley, on Uber’s board. The investors made their demand for Mr. Kalanick to step down in a letter delivered to the chief executive while he was in Chicago, said the people with knowledge of the situation.
In the letter, titled “Moving Uber Forward” and obtained by The New York Times, the investors wrote to Mr. Kalanick that he must immediately leave and that the company needed a change in leadership. Mr. Kalanick, 40, consulted with at least one Uber board member, and after long discussions with some of the investors, he agreed to step down. He will remain on Uber’s board of directors.
Laurie Segall and Jethro Mullen of CNNMoney,com reported on the company’s leadership crisis:
Kalanick’s departure deepens the leadership crisis at Uber, which has 14,000 employees and more than 1 million drivers.
The company was already lacking top executives for operations, finance, marketing and business.
“There really is no top brass at Uber,” James Cakmak, an analyst with Monness, Crespi, Hardt & Co, wrote in an investor note last week.
Kalanick co-founded Uber in 2009 and built it into the world’s most valuable startup by steamrollering competitors and ignoring regulations. The company has tangled with local and national governments, labor unions and even its own drivers.
Yet its model has spread around the globe, shaking up transportation industries across Asia, Europe and Latin America.
The image Kalanick gained of an aggressive leader seeking to grow his company at any cost became an increasing burden as Uber’s difficulties mounted.
Julia Carrie Wong of The Guardian reported that the company has widespread issues:
The brand’s reputation was also tarred at the start of the year by its association with US president Donald Trump, due to Kalanick’s position on a Trump economic advisory council and the company’s non-participation in a New York City taxi strike in protest of the first iteration of Trump’s travel ban. Kalanick stepped down from the advisory council, and the company claimed it did not intend to violate the strike, but the damage was done: according to the New York Times, about 500,000 users followed through on a social media campaign calling for people to #DeleteUber.
In February, Fowler’s blogpost paved the way for dozens of reports on a seemingly toxic workplace, and a non-stop drip of revelations including a trip by executives to a South Korean escort bar, an internal “sex memo”, and the alleged mishandling of a rape victim’s medical records by executives who sought to discredit her story.
The company will hope Kalanick’s departure and the implementation of the Holder report’s recommendations can lead to a period of respite. But Uber continues to face challenges on multiple fronts.
The embattled company is currently squaring off against Google parent company Alphabet’s self driving car arm Waymo in an intellectual property lawsuit that could pose an “existential” threat to Uber’s future. The suit has already claimed the job of the head of Uber’s self-driving car programme, ex-Googler, Anthony Levandowski. Uber is also under federal investigation for its use of a program designed to deceive law enforcement in cities where its service was barred.
