On Tuesday, the company’s former chief executive—who admitted he “need[ed] leadership help”—resigned. He will stay on Uber’s board of directors.
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.
Kalanick told The Times:
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.
Uber’s board of directors gave reporters the following statement:
Travis has always put Uber first. This is a bold decision and a sign of his devotion and love for Uber. By stepping away, he’s taking the time to heal from his personal tragedy while giving the company room to fully embrace this new chapter in Uber’s history. We look forward to continuing to serve with him on the board.
Uber has declined to issue any further statements.
Kalanick’s announcement is the most recent chapter in a PR saga that The Times called “a prime example of Silicon Valley start-up culture gone awry.”
Recent hits to the company’s reputation include a $20 million settlement over driver earnings , a federal investigation into its software designed to skirt local government regulations ,a lawsuit by Google’s Waymo alleging that Uber stole details about its self-driving technology, and the firing of 20 employees and Uber’s senior vice president after an investigation into the company’s culture reported systemic problems with sexism and harassment.
As Uber struggles to repair its reputation, it has seen a host of leadership departures.
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Kalanick’s departure has been preceded by those of many other senior figures in the company. Most recently venture capitalist David Bonderman resigned from Uber’s board of directors last Tuesday evening after making a sexist comment at the all-staff meeting where the Holder report’s recommendations were presented.
Other executives to have left this year include president Jeff Jones, senior vice-president of engineering Amit Singhal, head of policy and communications Rachel Whetstone, vice-president of maps Brian McClendon, vice-president of product and growth Ed Baker, and head of finance Gautam Gupta.
Uber also fired its president of business in the Asia Pacific, Eric Alexander, after journalists inquired about the former executive’s obtaining the medical records of a woman who had been raped while taking an Uber ride in India.
These departures make it difficult to roll out PR and business efforts, which most recently include Uber’s 180-day plan to answer driver requests . It also provides a challenge to a company who desperately needs strong leadership.
Following his leave, Kalanick had put day-to-day leadership in the hands of several employees who had reported directly to him. With Kalanick’s resignation, Uber is now missing a CEO, COO, CFO, CMO and a host of other critical high-level positions following months of seemingly endless executive departures.
Though cleaning house might help Uber establish a less toxic company culture and fix its reputation, finding a new chief executive to fill Kalanick’s shoes won’t be easy—in part because Kalanick will remain on Uber’s board of directors and will probably still influence company decisions.
Now Uber needs to find a new, permanent chief executive. As a major Uber shareholder, Kalanick is likely to continue wielding significant influence from the sidelines. But it’ll be important that the company’s new chief executive be truly independent so that he or she can credibly promise to change Uber’s culture and start to put its many scandals behind it.
Bloomberg’s Leila Abboud wrote:
While Kalanick's surprise resignation clears the way for a new leader, finding someone of the right caliber who's willing to take on such a difficult job won't be easy. Uber was already struggling in its hunt for a number two to fill a chief operating officer role. That was cast as adult supervision for Kalanick as the company tried to end a crisis over sexual harassment allegations and other wrongdoings.
A new CEO will have more clout to make real changes than a second-in-command ever would have. That said, Kalanick, who's said to control a majority of the votings rights at Uber, will keep his board seat. So the incoming boss will still have a powerful founder breathing down their neck.
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