'Always be Hustlin'? As Travis Kalanick takes a back seat, Uber can move forward

Without Travis Kalanick, it is very unlikely that Uber would have established itself around the world with the speed and force that it has.

Ever since the app, which links up GPS-equipped drivers and passengers, was launched in 2009, Kalanick has displayed little empathy for a world view that didn't fit his own.

Among his inspirations are Howard Roark, the individualistic anti-hero of Ayn Rand's The Fountainhead, and Alexander Hamilton, one of the United States' founding fathers, whom he has described as "America's first capitalist".

Kalanick prizes winning above all else: even while running one of the world's most valuable technology companies, he would boast about his high scores on video games such as Angry Birds and Wii Tennis.

With a $US68 billion valuation by private investors, Uber is the most valuable startup Silicon Valley has produced over the last decade.Credit: AP

The ruthless streak helped Uber become a fixture in hundreds of cities, before sleepy regulators and the slow-moving taxi industry were able to notice.

Rather than engage in a painstakingly slow dialogue with city halls before launching somewhere, Kalanick and his fellow conspirators would do the reverse: plant their flag, have it become part of the furniture, and then deal with the consequences once consumers are on your side.

It's easier to beg for forgiveness, so the saying goes, than ask for permission.

Unfortunately for Kalanick, he has had to ask for forgiveness one too many times. On Wednesday, the company's founder resigned as chief executive after investors' patience had finally been exhausted by a series of scandals.

Perhaps the only surprise was that it took this long. In most companies afflicted by the problems Uber has been dealing with, its leader would have fallen on his sword a long time ago.

The world's most valuable start-up, valued at almost $US70 billion ($93 billion), has been a byword for controversy for years.

Opponents claim that since drivers often do not have to abide by the same training or safety standards as taxi drivers, they put passengers at risk. Uber has been accused of further clogging up congested cities, while its surge pricing, which raises the cost of a ride at times of peak demand, has been attacked as exploitative.

The company's relationship with its own drivers has always felt like one of convenience. They are not staff but defined as self-employed, meaning that they are not guaranteed the minimum wage (Uber says they earn significantly more on average), pay their own expenses, and do not qualify for holiday or sick pay. Uber is also experimenting with cars that can drive themselves, ruthlessly threatening to make existing drivers obsolete.

Perhaps the only surprise was that it took this long

But it is in the last six months that the troubles have really started to emerge. In February, Kalanick was covertly filmed verbally abusing one of his drivers, dismissing claims that the driver had been made poorer by changes to Uber's fee structure as evidence that "some people don't like to take responsibility for their own s---".

Uber was accused of developing technology designed to evade regulators and breaking the iPhone's app rules. Google sued it over claims it stole driverless technology and a series of executives chose the exit door, several of them seemingly not replaced.

More seriously, it was forced to investigate damaging allegations of sexism and harassment; not a great look in any company, but especially problematic in Silicon Valley where businesses are supposed to be driven by their missions, and a shortage of skilled engineers means workers have the pick of who they work for.

No innocent bystander

The investigation ultimately led to more than 20 people, including Kalanick's number two, Emil Michael, resigning last week.

Kalanick was not some innocent bystander in all of this. He exercises near-total control at the company, and despite the huge sums invested in Uber, still enjoys a majority of voting when allied with two insiders from Uber's early days. He has been personally involved in some of Uber's more distasteful moments, reportedly viewing the medical records of a woman raped by an Uber driver after other executives who questioned her story had obtained the files.

The company's corporate values required users to "Always be Hustlin'", a commandment that can only have come from the gospel according to Kalanick.

His survival had been extended by Silicon Valley's cult of the founder, which often extends more credit than is due to visionary tech leaders and inspires tremendous loyalty in employees. For a while, there had also been little evidence that Uber's internal problems were affecting business: most of the millions of consumers who use the service seemed to have little interest in the cloud engulfing the company.

But in the US, Uber eventually started to leak market share to Lyft, its closest rival. With the company still losing hundreds of millions of dollars a month, it can hardly afford to see its lead slip further if it is to justify its astonishing valuation.

Observers had not failed to notice how the company's backers had stayed silent for so long. Perhaps it was the threat of losing their investments that eventually forced a group of shareholders, led by Benchmark Capital, to force Kalanick out.

At least when they finally spoke up, it was to make the right decision. For Uber's sake, Kalanick had to go.

Uber's struggles in 2017

Late January: Hundreds of thousands of Uber customers reportedly cancelled their accounts in response to the #deleteUber social media campaign after the company continued to run service while taxis were on strike at John F. Kennedy International Airport in New York. The strike was to protest President Trump's travel ban targeting foreign nationals from seven Muslim-majority countries. Some users viewed Uber's decision to continue to pick up passengers as an attempt at profiteering.

February 2: Amid continuing criticism for not suspending service to JFK over the travel ban, Uber chief executive Travis Kalanick stepped down from his position as a strategic adviser to Trump. Kalanick had been a member of a special advisory council to the White House that included Tesla chief executive Elon Musk and a number of other executives.

February 21: Uber suddenly found itself embroiled in a sexual harassment controversy after a blog post by Susan Fowler, a former Uber engineer, went viral. In her post, Fowler outlined a number of allegations against the company and said that her reports of inappropriate sexual attention from a manager went largely ignored and that Uber's HR department blamed her for "[being] the problem." The incident created a social media firestorm, prompting Kalanick to announce an investigation led by former US Attorney General Eric Holder.

February 23:​ Uber again landed in hot water when Google's self-driving car spinoff, Waymo, filed a lawsuit against the ride-hailing company that threatens to halt Uber's progress in developing its self-driving car. The suit accuses a former Google executive, Anthony Levandowski, of stealing sophisticated self-driving technology from Google before leaving to form his own self-driving truck company, which was then acquired by Uber.

February 27:​ Amit Singhal, another top Google employee who left to join Uber, stepped down after a report that he failed to disclose the real reason he left the search giant - namely, that he had been accused of sexual harassment while at Google. Singhal voluntarily departed Google, and was later asked by Kalanick to leave Uber, according to news reports.

February 28: Kalanick got into an argument with an Uber driver over fares. The encounter, which was caught on video, showed Kalanick boasting about how hard he drives his employees and accusing the driver of failing to take responsibility for his own income. The driver pointed out that Uber has repeatedly lowered wages for its drivers. Kalanick later apologised and said that he needed "leadership help." The company said it was looking for a chief operating officer to work with Kalanick. "I must fundamentally change and grow up," Kalanick said in a blog post.

March 3: Reports surfaced that Uber had used a secret tool, known as Greyball, that allowed the company to circumvent government investigators in a years-long game of cat-and-mouse. The tool was designed to help Uber avoid abusive riders, but the company started using it to thwart regulators in places where the service was restricted or banned. The revelation was a reminder of other covert actions Uber had taken to defeat its competition.

March 19:​ Uber's president, Jeff Jones, said he was leaving the company over the sexual harassment allegations that were dogging the firm. "The beliefs and approach to leadership that have guided my career are inconsistent with what I saw and experienced at Uber, and I can no longer continue as president of the ride-sharing business," Jones said in a statement.

March 25:​ Uber briefly suspended its self-driving car testing at the end of March, a day after one of its autonomous vehicles got into a crash in Arizona.

April 12: Uber is reported to have operated a top-secret program known as "Hell," which sought to identify drivers for Uber competitor Lyft. The program not only helped Uber in locating Lyft drivers, potentially giving Uber a competitive advantage, the report said, but could also identify which Lyft drivers also drove for Uber. Those drivers would then be singled out for special driver-retention efforts.

April 14: California regulators said that Uber may be subject to more than $US1 million in fines after the company repeatedly failed to take action against drivers that passengers said were driving drunk. Uber investigated only 13 per cent of passenger reports about drunken driving, according to California's Public Utility Commission.

April 27: Amid the boiling lawsuit between Waymo and Uber over self-driving cars, Levandowski, the former Google employee at the centre of the controversy, said he will stop working for Uber on any issues related to lidar, the sensing and detection technology that helps cars "see."

May 4: Two months after the public learned about Greyball, the Justice Department launched a criminal probe into Uber over the issue, raising the stakes immensely for the embattled company. Both Uber and DOJ have declined to comment on the matter.

May 30: Uber said it fired Levandowski over his failure to turn over thousands of documents related to the Waymo lawsuit as a judge had requested. In its letter terminating Levandowski,

May 31: Uber's head of finance, Gautam Gupta, left the company to join an unnamed startup.

June 6: More than 20 employees were fired from Uber in connection with its workplace probe - an unprecedented decision by a company, according to some legal analysts. As a result of the investigation, 31 employees will receive training and seven have received written warnings. The inquiry looked into 215 reported cases of harassment that contributed to reputations of an overall toxic culture at the company.

June 11: As Holder's investigation into Uber's toxic work culture drew to a close, Uber's board met behind closed doors to consider his law firm's report and recommended policy changes. The board unanimously agreed to beef up the company's employee complaint process, require executives to undergo mandatory trainings and conduct a review of Uber benefits to ensure that, for example, men and women would receive equal family leave time.

June 12: Emil Michael, a top Uber executive and a key confidante to Kalanick, stepped down from his post as senior vice president for business. Meanwhile, Uber brought on a new board member, Nestle executive Wan Ling Martello, bringing the total number of women on the board to two.

June 13: Holder's long-awaited recommendations were finally revealed. That same day, Kalanick said he would be taking an indefinite leave of absence from Uber, citing the need to grieve for his mother, who had died weeks earlier in a boating accident. In an all-hands meeting at Uber to discuss how the company would be tackling issues of sexual harassment, board member Arianna Huffington welcomed Martello - only to be interrupted by another board member, David Bonderman, who said that having more women on the panel would mean "more talking." Bonderman, the billionaire founder of private equity firm TPG, later apologised and resigned from the board over the incident.

June 20: Kalanick officially stepped down as chief executive, bowing to pressure he said he had received from investors and surprising many who had expected the brash company founder to continue with his temporary leave of absence. The departure marked the end of an era for Uber, which Kalanick said risked being "distracted" by the shareholder revolt if he did not step down.

"I love Uber more than anything in the world," Kalanick said in a statement first published by the New York Times. "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."

The Daily Telegraph London, The Washington Post