After some Tuesday night drama in Silicon Valley involving Uber CEO Travis Kalanick and several key investor in the embattled ride-hailing company all worthy of Silicon Valley the HBO show Kalanick has resigned from his role at the company he co-founded eight years ago. The move comes just a week after Kalanick announced an indefinite leave of absence, under pressure from the company's board, and shortly after the company announced a new policy to allow tips for drivers in the Uber app something Kalanick had staunchly opposed for years.
Kalanick issued a statement, imbued with clear emotion, just weeks after the death of his mother in a boating accident and major corporate upheaval, saying, "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."
As NBC News reports, Kalanick will retain his seat on the company's board of directors.
Uber's board issued a brief statement saying that Kalanick's decision would allow “room to fully embrace this new chapter in Uber’s history."
As the New York Times reports:
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.
In the letter, titled “Moving Uber Forward” and obtained by The New York Times, the investors wrote to Mr. Kalanick that he must immediately leave and that the company needed a change in leadership. Mr. Kalanick, 40, consulted with at least one Uber board member and after long discussions with some of the investors, he agreed to step down.
The key investors, which include Benchmark, Lowercase, First Round, and Menlo Ventures, all stand to lose billions of dollars if the company drops from its most recent $70 billion valuation.
The move, as most everyone who has heard of Uber likely knows, comes after months of controversy and bad press that has centered not only on allegations of widespread sexual harassment within the company, and a lawsuit involving the company's self-driving car division, but also recent revelations of specific situations that Kalanick allegedly had a direct hand in, including an email to company employees about having sex with each other, and one involving a sexual assault victim in India whose medical records were allegedly passed around between executives. There were also multiple other things, including the codename Greyball operation that was meant to skirt local law enforcement, and that time he screamed at an Uber driver, on camera, and admitted later that he needed some help with the whole leadership thing.
Still, Uber board member Arianna Huffington was just saying three months ago that Kalanick wasn't going anywhere and "the whole ride-sharing industry would not be where it is today without Travis."
Kalanick co-founded Uber in 2009, using the name UberCab, along with Garrett Camp, the cofounder of StumbleUpon, who remains a member of Uber's board of directors.
TechCrunch notes that Uber has raised over $11 billion in funding* and has lately been valued at $70 billion, "Though Silicon Valley investors have shown that they will follow a founder’s direction in even the most turbulent times, recent events had threatened Uber’s stability."
While Uber has dominated the ride-hailing market in the last several years by quite a wide margin, the Washington Post reported that all the recent scandals and bad press had increased Lyft's market share from about 18 percent at the beginning of this year to 25 percent as of this month.
*Per the NYT, the company has received $13 billion in funding since its founding.