Travis Kalanick Has Resigned His Role As Uber CEO

Photo: Getty
Photo: Getty

Uber’s founder and CEO Travis Kalanick has resigned after mounting pressure from shareholders over a string of workplace scandals. Previously, he had said he would take a temporary leave of absence in the wake of an investigation into Uber’s company culture, which was said to foster harassment and discrimination.

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Five of Uber’s major investors pressured Kalanick to step down, the New York Times reported, including First Round Capital, Lowercase Capital, Menlo Ventures, Fidelity Investments, and Benchmark, a venture capital firm with a seat on Uber’s board. The group of investors sent a letter to Kalanick on Tuesday asking for his resignation.

Kalanick will remain a board member at Uber, and the company will search for a new CEO, according to Times.

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Uber has faced ongoing scrutiny over allegations of workplace harassment, a criminal probe into its attempts to evade regulators, a lawsuit over trade secret theft brought by Waymo—its competitor in the self-driving car industry—and a lawsuit brought by a woman who alleges her medical files were improperly shared by Kalanick and other executives. Twenty Uber employees were recently fired after the harassment investigation, and the head of its autonomous vehicle program was fired for refusing to cooperate in the lawsuit.

Even though Silicon Valley startups often pride themselves on their rule-breaking, Uber’s ongoing issues proved too much for its investors. Kalanick was seen by his supporters as a key component to Uber’s success. But with Uber valued at $70 billion, the risk was no longer worth it.

Kalanick’s departure from the chief executive role is just the latest of several from the company’s executive team. There is no chief operating officer or chief financial officer at present, and several other executives have been pushed out in recent months.

“I love Uber more than anything in the world and at this difficult moment in my personal life I have accepted the investors request to step aside so that Uber can go back to building rather than be distracted with another fight,” Kalanick said in a statement.

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[New York Times]

Kate Conger is a senior reporter at Gizmodo.

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DISCUSSION

I don’t get the frenzy to own a piece of this company.

In addition to the profound evidence that Kalanick plays extremely dirty, founded a culture of nastiness, sexism, and corruption, and harasses whistleblowers to an extent that would be criminal if the wealthy and powerful didn’t get away with so much in America, Uber has a much bigger problem:

It doesn’t make any money.

It has never made any money.

Indeed it *loses* money at a rate generally reserved for once-mighty titans of industry now being annihilated by newer business models and technology.

It lost THREE BILLION DOLLARS last year.

Before anyone else supports this grand effort to put traditional cabdriving in the grave - and I am not particularly defending that industry here, which has many of its own problems, but I also don’t see it as the world-ending funnel of greed that Uber is - this company really, really needs to convince the market and the world that it is something other than a giant scheme to funnel paper profits into an utterly unsustainable business model. Or, to put it more precisely - an utterly unsustainable business model that puts a long-standing, actually sustainable business model out of business...along with all the cabdrivers and associated jobs in it.

Yes, no doubt it’s great to get cheaper rides and avoid dirty, poorly maintained cabs, but if Uber can’t actually find a way to turn a profit this is all going to end in tears. Paper valuations can only prop up actual cash payouts for so long. At some point, this company actually has to make sure its payouts and receipts equate to zero or black, or this is all going to end very badly. (And so far there’s no evidence that ridesharing has yet been profitable - Lyft lost $600m as well last year - though at least with them, there seems to be a potential light at the end of the tunnel.)