If Uber stalls out, rival ready to give you a Lyft

Uber was a burning fuse from the start, right up to when the sparks of scandal, harassment and arrogance erupted into a world-class blaze.

Now the man who set and lit the fuse has been fired.

So, now what? Are there lessons here in branding? In how to run a company? How to be a leader -- or not?  It’s a business question, an issue of corporate culture – not to mention a dilemma in branding.

Oh, in addition to being a classic Geek Tragedy.

The hubris of Silicon Valley, you see, lifted skyward to the sun on the wings of venture capital only to plunge... well, enough of that metaphor.

But the word Uber, if I recall a little bit of my German from school, is often appended to words to mean "super" or to describe dominance. More than a century ago – long before DC Comics – Nietzsche put it together with the word for 'man' to create the word Übermensch -- the super man.

And well, that was the attitude that Uber the super company brought to the ride-hailing business.

You might think you’d have to really mess up to get canned after taking nothing and turning it into a huge business in a new industry that it had created and went on to dominate, while surging to a stock value of roughly $70 billion.

You’d be right, of course.

Travis Kalanick -- a man Fortune magazine calls a “visionary and pantomime villain” – really messed up.

That visionary thing went well. It was the other stuff. Being arrogant, sexist and contemptuous of trivial concerns like laws and regulations and courtesy. He established a culture and company that was bullying and aggressive and utterly disrespectful of women.

Now ol’ Travis has been fired (more precisely, he allowed himself to be fired because he is still the majority shareholder).

But the ultimate question is, if a wrong-headed, bullying owner leaves a company, what happens to the culture he created, rewarded and nurtured? There’s a lot riding on that, because Uber had bet billions of dollars on becoming a virtual monopoly.

And yet, it has rivals.

This was how it played out. The founders raised an astounding amount of money. So they could afford to charge low prices – that and the truly superb technology is pretty much the formula for killing the taxi business. And Uber figured they could likewise out-muscle ever other ride-hailing companies, dominating the market until they were free to raise taxes.

Then, the profits would pour in like a mighty river.

Only it turned out that there were rich guys willing to bankroll some of the other guys, too. Carl Icahn, for example, plopped a cool $100 million with rival Lyft. So now, there's trouble. Uber's huge market share is slipping.

And the Uber reputation is – not to put too fine a point on it – tarnished.

TIPPING FINALLY PERMITTED ON UBER (JUST LIKE ON LYFT)

It’s being criticized from a variety of quarters. For instance, Rebecca Smith, deputy director of the National Employment Law Project, said the company practices deceptive treatment of its drivers – and she laid the blame on Kalanick.

“It must fix its biggest problem: a business model that mimics the irresponsibility of its founder,” she said. “Uber has perpetuated the blatant untruth that its low-wage drivers—whose every move is dictated by the company—are somehow in business for themselves.”

There are questions about its adhering to labor law.

 ALTERNATIVES TO UBER

Then there are questions about privacy – just what data is Uber collecting on customers and drivers? What does it use that data for?

There was Kalanick’s bullying rant against one of his own drivers. His out-of-control behavior at least departs with him.

But what about the culture he leaves behind? The harassment of women that was part of what Vanity Fair called a “toxic culture that triggered a series of investigations into the company.”

First one female engineer wrote about being harassed, while human resources managers either ignored, patronized or criticized her. Then dozens of other employees came forward to tell about a sexist workplace environment.

Finally, with the spotlight on, more than 20 Uber employees were fired. But the culture? The environment that was, by all accounts, shaped by Kalanick and his associates, has that changed?

Because while the fuse burned at Uber, Lyft was getting ready to move in.

Could it be that, despite Uber’s intimidating head start and its billions in backing, the last will someday be first? Hard to know and you don’t generally bet against a company with the advantages of Uber.

But if it eventually explodes, Ezra Klein says that Lyft could pick up the pieces.

About the Author

ajc.com

Editors' Picks