Travis Kalanick Is No Longer The CEO Of Uber Because He Owed Way Too Many People Too Much Money

You heard it here first: Travis' replacement should come from Wall Street, not Sand Hill Road.
Author:
Updated:
Original:

As of today, Travis Kalanick's unfettered reign at the $70 billion Ayn Rand-themed car service that lives on your phone is over.

KalanicksArk

The internet is awash in hot takes detailing what made Travis so breathtakingly successful and what brought Travis down. Sure, the list of his errors is long and sordid and makes a logical person wonder how he stayed in charge so long, but all of this retrospective "introspection" misses the entire point of why Kalanick has lost his CEO title. Uber is indeed Uber because Kalanick had all the drive of a megalomaniacal entrepreneur inflected with the hip "coolness" and famed "social grace" of an engineer. Those character traits that allowed him to ideate something revelatory, bring it to market, and then treat the market and everyone in it like a bunch of dumb fucking assholes who were lucky to even glimpse his reflected brilliance.

That might have read a little mean to some of you, but being a smart asshole with unlimited ego and severely limited self-understanding is a key factor in the creation tale of Silicon Valley as a whole. Travis Kalanick didn't succeed despite his dickhead reputation, he thrived because of it. What brought down Travis is the reality that he has raised way too much money and had clearly no idea about how to reward his investors other than to keep being Travis and assuming that no one was going to have the balls to stop him.

Let's take a moment and be over-simplistically honest with one another: When you take venture capital from someone, you owe them. Yeah yeah yeah, due diligence and risk and yadda yadda yadda, but when you give millions to a young entrepreneur, a relationship is forged in which a sense of debt is created. That's just human nature and it doesn't change just because your name is Sacca or Andreessen or Thiel [well , maybe that last one doesn't apply to the "human nature" argument].

According to Crunchbase, Travis Kalanick raised $8.81 in total funding over 14 rounds from 78 investors. That's a lot of people looking to get paid back, especially when some of them aren't people but institutional players with names like Fidelity, Morgan Stanley, Goldman Sachs and "The Saudis." Part of what made Travis so impressive was his ability to tell all of these parties that he was planning on taking Uber public in the third quarter of Maybe Fucking Never, but that balls-out stance of telling investors that you have no real plans to help them exit is hard to maintain when shit hits the fan, your valuation starts to erode and employees tell the press about that one time you held a co-ed business meeting in a Korean escort bar.

People inside and outside Uber put up with Travis' pricky shit for years, and he even almost got away with it by parading Arianna Huffington around as a human "Woke Pass." But without the carrot of a looming IPO, Travis failed to understand that someone else was holding the stick.

If Uber had kicked off its IPO roadshow six weeks ago, guess who would still be CEO of Uber? Travis. Would shit still be brutally ugly at Uber HQ in the wake of the Holder Report and David Bonderman sexist-joking himself off the board? You betcha. Would Bill Gurley have had the juice to override Arianna and stage the coup that finally ousted Travis K? Not on your life, bro.

You know how we know that we're onto something? Look how this went down!

According to Mike Isaac at The NY Times:

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.

Bill Gurley was one of the people closest to Travis, and yet Bill Gurley is clearly the one who wielded the sword because Bill Gurley INVESTED $411 MILLION INTO UBER. And it stands to reason that he overcame any objections from Arianna by pointing out that her monetary investment into Travis' tragic kingdom amounted to a sum total of Zero dollars.

Look at what Gurley tweeted with his still-bloody fingers:

It would have been almost impossible for Gurley to consign Travis to the dustbin of tech founder history if even the semblance of an Uber IPO plan actually existed. By conflating Uber's worth with Travis' "genius," an unwieldy enormous barge of money was allowed to float without guidance onto the seas of finance. Which is exactly why we should all expect a new captain to drop in via helicopter from a place outside Silicon Valley to steer this thing into the ocean of public trading.

Uber's done the tech oracle bad boy thing, and it almost killed it. As far as we're concerned, Uber's board would be insane to start kicking the tires on Adam Bain or Sheryl Sandberg or David Sacks [we would welcome a Marissa Mayer hire because we're sadists, but that's a different post]. We said a few weeks ago that Travis had to get his own Ruth Porat, a Wall Street vet unencumbered by Silicon Valley's dogma. Now we're saying that Uber needs to go The Full Porat and get a CEO to create a Wall Street friendly IPO plan that will dig everyone inside Uber out of their own mess.

What's our idea? Well thank you for asking.

Goldman Sachs has more than $1.6 billion of convertible debt sitting in Uber. So while Lloyd could just sit pat and wait to get paid back first on any tire fire IPO that might come out of Uber 2.0, he should embrace his new Twitter-fueled "cool bro" persona and play the possible upside. We propose that Lloyd lend out his newly-minted tech-savvy CFO Marty Chavez as Uber's Pre-IPO CEO. Like a European soccer team sending talent out on loan, Marty could create a huge opportunity for Goldman over at Uber while simultaneously getting practice as head honcho for the inevitable moment that he leapfrogs Harvey Schwarz and David Solomon to end the reign of "Power Balds" and take over at 200 West St. In addition to being a Goldman Sachs-level adult, Chavez also happens to be a gay latino, a lame identity politics angle that Uber unfortunately needs...badly.

We assume that Uber will inevitably blow the Travis succession plan (letting Travis reportedly participate in that process makes us confident in our prediction) but we also think that Uber can be saved...and by "Saved" we mean everyone can get at least get some of their money back.

Related