Uber's Travis Kalanick forced out by investors — BUSINESS REPORT

Marco Green
June 27, 2017

Among Uber insiders, however, there's an ongoing debate about whether the company can continue to outpace the competition if the brash Kalanick is replaced by an executive with a softer touch.

The move comes amid a whirlwind of crises for Uber, but especially for Kalanick.

Uber lost an expensive battle for supremacy in China against Didi Chuxing and had to be satisfied with taking a stake in Didi as a consolation prize. The loss narrowed from the $991 million it posted in the previous quarter.

For months, Uber has been in a dramatic and public downward spiral.

However, he has been faced with increased scrutiny for a culture of sexism and rule-breaking at the company he helped start in 2009.

"Uber couldn't make a credible claim that it was committed to the changes it has to make if he was hovering in the wings, waiting to return as CEO", said Erik Gordon, a technology and entrepreneurship expert at the University of Michigan's Ross School of Business.

Travis Kalanick himself issued a statement as well, explaining that "Uber 2.0" was in need of new leadership in order to be successful. "There is no business model in being at war".

Its charge to become the world's biggest ride-hailing service has sparked regulatory challenges globally, including in the United Kingdom where it has fought drivers claiming an entitlement to minimum pay and a holiday wage.

While stepping down from his role as CEO is a large step in the right direction, it brings forward a question: how much influence will Kalanick's voice have on the board in comparison to the other board members? The company has been fighting to save its reputation amid allegations of trade secrets theft and reported efforts to mislead government regulators.

Earlier in February 2017, a former engineer released a detailed complaint concerning sexual harassment within the company.

A source briefed on the situation told the Post that "Sheryl is their first choice".

"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". Holder's report suggested procedures that most companies have had for years such as using performance reviews to hold leaders accountable.

To help Uber grow fast, Kalanick seemed to pick fights just about everywhere.

"Appointing a woman would certainly send a strong signal given the recent troubles, and that would be one of the easiest ways to cement a broad cultural shift away from the frat mentality that often characterized Travis Kalanick's tenure", Dawson said. Disney's chief operating officer Tom Staggs is also under consideration.

During the past year, several senior managers left the company, including the president and chief financial officer.

Gurley, one of Kalanick's closest confidants, praised the CEO on Twitter following his resignation. These firms own over a quarter of Uber's stock, and they have about 40% of the company's voting power, since the kind of stock they hold allows them "with an outsize number of votes". His mother was killed in a boating accident and his father was injured.

Other reports by Click Lancashire

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