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Uber Imploding: Chief Business Officer Resigns As Kalanick Plans “Leave Of Absence”

Courtesy of ZeroHedge. View original post here.

The uber implosion at Uber continues.

Two days after it emerged that Uber CEO Travis Kalanick had fired off a bizarre email in 2013 to hundreds of employees where he listed the conditions under which they could have sex with each other at a company outing in Miami, the WSJ reports that not only is Uber Chief Business Officer Emil Michael said to resign on Monday, just two days after it was reported that Uber’s head of finance Gautam Gupta was departing to take a position at OpenDoor, but that embattled Chief Executive Travis Kalanick “will discuss taking a possible leave of absence when the board of directors of the embattled ride-hailing company meets Sunday morning.”

From the WSJ:

Uber Technologies Inc. executive Emil Michael, one of Chief Executive Travis Kalanick’s closest confidants, is planning to resign as soon as Monday amid an ongoing investigation into the company’s workplace culture, according to people familiar with matter.

Mr. Michael, as chief business officer, helped oversee broad strategy initiatives including mergers and acquisitions and fundraising. He joined Uber in 2013 from Klout Inc., which rates users’ online reputation, and had worked as an adviser to technology companies.

Also on the agenda of today’s meeting of the seven-person board is a vote on a series of recommendations from a report prepared by former U.S. Attorney General Eric Holder regarding its workplace.

It was uncertain whether Mr. Kalanick would ultimately take the leave or whether the board would approve of such a measure, which would require finding a temporary replacement in short order.?

Following  a wave of “setbacks and scandals” that have besieged the ride-hailing service earlier this year, many executives have left the company. Uber has been trying to hire a deputy for Mr. Kalanick after a leaked video in February showed Mr. Kalanick berating an Uber driver. Uber is also seeking a CFO.

As noted recently, here is a snapshot of some of the most notable scandals that have emerged, involving the world’s most valuable private company:

  1. Another tale of sexism and unacceptable workplace behavior in Silicon Valley company has emerged. This time it’s at Uber, according to an explosive blog post published on Sunday by a former company engineer named Susan Fowler Riggetti.
  2. Uber’s newly-hired VP of engineering Amit Singhal was asked to, and did, resign on Monday after the company learned from Recode that he was accused of sexual harassment shortly before leaving Google a year ago. Here’s more on the difficult position of former employers in this case.
  3. A video showing Uber CEO Travis Kalanick rudely arguing with a long-time driver at the end of his ride was published by Bloomberg. “I need leadership help,” Kalanick said in an apology he issued shortly after.
  4. Susan Fowler Rigetti, the former Uber engineer who wrote of discrimination, said she’s hired attorneys after a new law firm began to investigate her claims. Uber confirmed it has hired Perkins Coie, which reports to former A.G. Eric Holder, who’s leading the investigation.
  5. Uber said on Thursday that it will finally apply for a DMV permit to test self-driving cars in California after its cars’ registrations were revoked in December because it refused to get the permit.
  6. Charlie Miller, one of the two famous car hackers who joined Uber’s Advanced Technology Center in August 2015, announced he’s leaving the company.
  7. The New York Times uncovered a secret Uber program called Greyball, through which the company uses software and data to evade law enforcement in cities.
  8. Keala Lusk, a former Uber engineer, published a blog post detailing how her female manager mistreated her, signaling that the company’s problematic culture isn’t limited to the men who work there.
  9. Ed Baker, Uber’s head of product and growth, resigned. Though the reason is unclear, he was allegedly seen kissing another employee three years ago, which was anonymously communicated to board member Arianna Huffington, according to Recode.
  10. A report outlines a trip by a group of Uber employees to a Seoul karaoke-escort bar in 2014, which included company CEO Travis Kalanick and his girlfriend, Gabi Holzwarth. After arriving, several male employees picked escorts to sit with, and went to sing karaoke. Uncomfortable, a female marketing manager, who was part of the group, left after a couple of minutes, while Holzwarth and Kalanick left after an hour.
  11. California regulators have recommended that Uber be fined $1.13 million for failing to investigate and/or suspend drivers who are reported by a passenger to be intoxicated. The state requires ride-hailing companies to have a zero-tolerance policy for driving under the influence of alcohol or drugs.
  12. A new report says Uber used a secret program dubbed “Hell’ to track Lyft drivers to see if they were driving for both ride-hailing services and otherwise stifle competition. Only a small group of Uber employees, including CEO Travis Kalanick, knew about the program, according to a story in The Information, which was based on an anonymous source who was not authorized to speak publicly.
  13. Waymo sued Uber in civil court, claiming that Uber was using trade secrets stolen from Google to develop Uber’s self-driving vehicles.
  14. Uber fires Anthony Levandowski, a star engineer brought in to lead the company’s self-driving automobile efforts who was accused of stealing trade secrets when he left a job at Google.
  15. Uber said Tuesday that it had made a mistake in the way it calculated its commissions, at a cost of tens of millions of dollars to its New York drivers, and the company vowed to correct the practice and make the drivers whole for the lost earnings.
  16. Uber fires over 20 staff following the release of a report about sexual harrassment in the workplace.
  17. Reports emerge that Uber CEO Travis Kalanick fired off a bizarre email in 2013 to hundreds of employees where he listed the conditions under which they could have sex with each other at a company outing in Miami

This list is by no means comprehensive.

According to the WSJ, if the board approves Mr. Kalanick’s leave, “it will mark a huge shift for the embattled CEO who developed a reputation for sharp elbows, a relentless work ethic and a willingness to push the limits of legality to achieve success. Chief of the ride-hailing firm since 2010, Mr. Kalanick has been the face of Uber amid its ascent to the world’s most valuable private company, pegged by investors at $68 billion.”

The seven-member board includes private-equity billionaire David Bonderman ; media mogul Arianna Huffington ; venture capitalist Bill Gurley of Benchmark; an official from a Saudi Arabian government investment fund; co-founder Garrett Camp, who is chairman; early employee Ryan Graves ; and Mr. Kalanick himself.

Uber has been conducting its own workplace investigation, including so-called listening sessions and focus groups led by human-resources chief Liane Hornsey and Ms. Huffington. Employees have also been summoned to the law firms’ offices for interviews.

The ride-hailing company had planned to release an executive summary for Mr. Holder’s findings to employees and the media, though some investors have called for a full version of the report to be made public.

And then there is the biggest problem of all: Uber’s chronic cash burn.

Uber lost $708 million in the first quarter, despite another rise in revenues. Last year, Uber managed to burn through almost as much cash as NASA’s $4.8 billion budget last quarter. Previously, Bloomberg reported that Uber has burned through at least $8 billion in its lifetime through the end of 2016. While the company had $7 billion of cash on hand as of March 31, along with an untapped $2.3 billion credit facility, inevitably questions will emerge if and when the world’s most previous “unicorn” will ever turn a profit. The company was most recently valued at $68 billion, although in light of the recent turmoil in the C-suite that number will likely be revised significantlly lower.


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