14 ms·

Letter from Benchmark to Uber Employees [pdf]

244 points by ted0 9y ago

dumbfounder 9y ago
Jeez, not trying to defend Travis, but the guy did create an umpteen billion dollar company in short order, creating absurd value for Benchmark's investment. The least they could do is start off with a hollow thank you and acknowledgement for that achievement. Apparently all Travis did was make mistakes. It really does smell more like a vendetta and less like them protecting their money.
- JumpCrisscross 9y ago
  > all Travis did was make mistakes If this letter's claims are true, Kalanick agreed, in writing, "to modify the company’s voting agreement to ensure that the board was composed of independent, diverse, and well qualified directors." He then defaulted on that written agreement with Uber's Board. That's a pretty serious mistake. Disclaimer: I am not a lawyer. This is not legal nor investment advice.
  - mike_hearn 9y ago
    Is it? Does putting something in writing automatically force you to do it, legally, if that writing is not a contract? Perhaps the mistake here is Benchmark's. If Kalanick agreed to do this in writing, and then didn't do it, that makes him look bad but it's unclear to me that Benchmark can do much about it. Maybe Travis has the last laugh.
    - JumpCrisscross 9y ago
      > Does putting something in writing automatically force you to do it, legally, if that writing is not a contract? It's unclear from the letter if this agreement was a contract or e.g. an email. If a contract, the answer is clear. If something less formal, note that American courts tend to treat written communications between sophisticated parties as legally binding, particularly if it occurs around negotiating a contract [1]. There's the further distinction that these are written communications between a CEO and his Board. At the very least, Kalanick made untrue statements to his investors. If he did it intentionally, it could constitute fraud. [1] https://www.law360.com/articles/950866/bank-bound-by-unsigned-lehman-deal-despite-dismissal https://www.law360.com/articles/950866/bank-bound-by-unsigne... Disclaimer: I am not a lawyer. This is not legal nor investment advice.
      - tannhauser23 9y ago
        If that was in a contract, Benchmark wouldn't have to sue for 'fraud' - they can sue to enforce the contractual agreement. Sounds like what they have on paper isn't as solid as they'd like you to believe.
    - dcole2929 9y ago
      Generally, yes it does require you to do so unless you also have it in writing that whatever document you just signed is not in fact binding. Even verbal agreements can be enforced as a legally binding contract so having a written document is a pretty high barrier to overcome legally speaking.
    - Powerofmene 9y ago
      In the US, generally it is binding. Communications and agreements between parties are binding particularly if TK received something in return for said promises. Even verbal agreements are binding in the US especially when dealing with parties such as these. If TK hopes to have any credibility moving forward, with the Board or in the courts, it would be in his best interest to keep commitments or he will be stuck in the "did you lie then or is this version a lie" mess. If he wants to argue that he made the agreement under duress then he can argue that in court and the court may find the the agreement is not enforceable but duress can be a steep hill to climb without physical, or threat of physical, harm.
- smallgovt 9y ago
  Discrediting Travis (read: vendetta) is the means through which Benchmark seeks to protect their investment. In order to liquidate their investment, Uber needs to IPO or Benchmark needs to find another investor to buy them out. Travis is a staunch opponent to an IPO. And, replacing Travis as CEO is a likely pre-condition to finding another investor who will buy Benchmark out. Either way, discrediting and removing Travis and protecting their money is more or less one in the same.
  - bjl 9y ago
    Benchmark doesn't need to discredit Travis, he did a mighty fine job of that on his own.
- warcher 9y ago
  So, this might be me just being dumb, but I don't understand how Benchmark has made any money whatsoever on this deal. Not yet. And what I mean by that is this: they gave Uber money for shares. But they have not yet sold the shares to anybody, b/c no acquisition or IPO. Other investors buy more shares, but that's not a liquidity event, is it? Benchmark has a whole boatload of paper profits that they can't return to their LPs, not yet at least. Or am I crossed up here? Could they, or have they, done some kind of private sale? I kind of doubt it but could easily be wrong here. Is there some kind of financial instrument to cash out early I'm ignorant of?
  - fullshark 9y ago
    They may have taken out a loan using the book value of Uber and re-invested it.
  - dumbfounder 9y ago
    That's why I said value and not actual return on investment. They have created an insane amount of value in the stock that Benchmark owns. If you were an investor would you rather take the money that Benchmark originally invested, or the stock they received for it? Pretty easy answer unless you think they will go bankrupt.
zitterbewegung 9y ago
Is this being sent to "Contractors" (drivers) and Employees or just Employees?
- ted0 9y ago
  I would assume that it is not being sent to drivers.
  - anindha 9y ago
    "We have tremendous respect for the incredible work you do to provide this vital service in cities all around the world and to create work opportunities for millions of people globally." Suggests that it is addressed to employees creating jobs, which would be the full time employees.
  - Theodores 9y ago
    It is addressed carefully to all Uber staff - we know they don't have normal staff with drivers. I think 'the umpire has spoken' and that Benchmark know that this well crafted letter will carry enough weight to be heard by everyone. I think it is a masterstroke by them to write like this.
hkmurakami 9y ago
This letter reads as faceless (who's Benchmark's representative on the board as of now anyways?) and a bit condescending to me. "We've never interacted with you in the past, but trust us, we're on your side and have your best interests in mind." Not sure what this letter is supposed to accomplish. Employees who were behind Benchmark already will continue to support them, and employees who were behind Travis will continue to support him, and if anything, the polarization will increase with this message.
- JumpCrisscross 9y ago
  > Not sure what this letter is supposed to accomplish Communicate why Benchmark acted in a manner they find to be reasonable? Assuming every single one of Uber's employees don't divide into neat pro-Benchmark and pro-Kalanick camps, this could help keep nervous minds put. Disclaimer: This comment is NOT investment advice. Please do not buy or sell any securities based on it.
  - Gargoyle 9y ago
    I don't work at uber, but this letter communicates nothing but drama and uncertainty to me. I can't imagine it put anyone's mind to rest.
    - JumpCrisscross 9y ago
      > his letter communicates nothing but drama and uncertainty This letter or the lawsuit? The suit certainly communicated drama and uncertainty, though if the accusations in this letter are true, it might have been a calculated judgment that lots of drama now is better than a slow drip over years. After filing the lawsuit, Benchmark could (a) stay silent, leaving everyone guessing (and letting the machinations they accuse Kalanick of orchestrating continue to work their rot) or (b) explain their actions. They chose (b).
- deleted 9y ago
  [deleted]
- tyingq 9y ago
mbesto 9y ago
> Uber’s excellent executive leadership team is making commendable progress on these changes, many of the most important issues agreed to by the board remain unaddressed. And so who precisely is Uber's "excellent executive leadership team" comprised of? No COO, CFO, and CEO...
beager 9y ago
Methinks the fact that this letter has gone out to rank-and-file employees at Uber signals a very tumultuous cultural impasse that the board is having a huge amount of difficulty clearing.
anindha 9y ago
No mention of the IPO disagreement. I wonder if most Uber employees would be for or against an IPO. I am sure many would want to cash out at this point and might support Benchmark for that reason alone.
evanlivingston 9y ago
"uber is the most important and promising company of our generation" If that's true, I'm scared.
- caser 9y ago
  It makes more sense if you replace "our generation" with "our portfolio."
- nostrademons 9y ago
  The audience of this letter is Uber employees, and the context is that the faceless VC who just pushed out their CEO is trying to gain their trust. I think a little flattery here is in Benchmark's interest, true or not. FWIW, Uber is very far from the most important and promising company of our generation in my mind.
- curiousDog 9y ago
  Most Uber employees I've talked to think Uber is the next Google.
  - deleted 9y ago
    [deleted]
- notyourday 9y ago
  It is the most important company in their portfolio and they are afraid that should their investment in Uber not payoff int he most spectacular fashion, they themselves would find out just how difficult it is to raise money after being labeled as a failure. [edit: Payoff in a most spectacular fashion here means "exited at nearly the top of the valuation"]
- hsod 9y ago
  It's probably the company that has had the most concrete impact on my life and the lives of my friends of this generation (depending on how you define generation).
  - 9y ago
jtchang 9y ago
When reading letters like this always be aware of the interests of all the parties involved and what they have to gain. Benchmark has a lot to lose if Uber starts bleeding talent (especially so in the engineering department). And it is there investment at stake if they can't turn the tide. I'm not advocating for one side or the other but there is a lot of money involved and when that happens you have to be very vigilant of who is espousing for what.
cbtacy 9y ago
This suggests that the full Holder report has some real, ugly dirt in it.
- rdiddly 9y ago
  Yes... leak please!
ChuckMcM 9y ago
Another interesting move on Benchmark's part. I wonder if this is the key sentence: "Travis’s failure to make good on this promise, as well as his continued involvement in the day-to-day running of the company, has created uncertainty for everyone, undermining the success of the CEO search." One of the key things about organizations which isn't always apparent is that leadership isn't "given" it is earned. This is often used as a tool in story telling where the hero's actions inspire people to follow them and so even though someone else is the "boss" the people are following the "hero." That they are complaining about Travis, who, AFAICT, does not even have an employee role at all in the company, continues to be "involved" in day to day operations, suggests that his lack of co-operation is the issue and Travis is, or continues to be depending on your point of view, the 'bad actor' in this situation. Sometimes you have classes where they throw out a hypothetical question like "What if you fired the boss and he didn't leave?" If Travis is able to exert that level of control over the company then clearly he continues to have people loyal to him doing as he asks against the wishes of the board. I can imagine that this would make it extremely hard to manage a company in that situation.
- throwaway0071 9y ago
  The fact that Travis doesn't want to let go of Uber is completely normal. He is the founder, the boss, the guy with lots of money. There's a power play in place and people don't know who will win. It's normal that employees at all levels will still give him some leverage. It doesn't say anything about employee loyalty or Travis being the leader they want.
  - deleted 9y ago
    [deleted]
- OzzyB 9y ago
  > Travis’s failure to make good on this promise Is this what happens when a CEO has a large voting block of shares (b/c he's smart enough to learn from previous founders' experience with VCs), and a VC firm that finds they can't have it their way (like they've been used to), publicly shame him for "not doing what he promised (us)"? Last I checked they ousted _him_ and now they want to play "victim" because they're finding it hard to find a replacement? Maybe none feels they're able to fill his shoes or do as good a job as he's done? Last I checked Uber was still a tremendous success regardless of all their bad press and missteps/deeds. Sorry, I just find it hard to sympathize with these people.
cocktailpeanuts 9y ago
I wonder how Uber employees actually feel about this, it sounds really condescending and tone deaf. If I was working at Uber I would be like "Who are you to suddenly show up and act like mom?"
Twirrim 9y ago
Do we know this is genuine? All I'm seeing is an unsigned PDF, stored in google drive, purporting to be from Benchmark.
- sah2ed 9y ago
  Funny thing is someone linked to Benchmark's twitter demonstrating the authenticity of the PDF in a reply to you. But refreshing this page and the post has now being deleted. https://twitter.com/benchmark/status/897144805762793472 https://twitter.com/benchmark/status/897144805762793472
  - Stratoscope 9y ago
    When I click your link, the tweet is there. Must have been a glitch?
    - carb 9y ago
      @sah2ed actually meant that a HN comment had linked the tweet they did. I saw it there too. The tweet itself was never deleted.
      - sah2ed 9y ago
        Yes, was referring to a HN comment. The original comment [0] had an id of 15011549. [0] https://news.ycombinator.com/item?id=15011549 https://news.ycombinator.com/item?id=15011549
        Stratoscope 9y ago
        D'oh! That's what I get for not reading carefully. Thanks for clearing up my puzzlement! :-)
  - Twirrim 9y ago
    Thanks.
- deleted 9y ago
ProfessorLayton 9y ago
I really want to read the "Holder Report". Reading from this context, it sounds like it may be pretty damning.
- vkrm 9y ago
  There's a part of it here: https://www.nytimes.com/interactive/2017/06/13/technology/document-The-Holder-Report-on-Uber.html https://www.nytimes.com/interactive/2017/06/13/technology/do...
cletus 9y ago
Wow. Is there any precedent for this? Where the board is at war and the investors mail the employees? They must be utterly desperate for a fire sale IPO at this point. How is something like this not meant to spook other investors, employees and potential CEOs? I do wonder if Travis is miffed at his ousting. Probably. But is he willing to burn the company to the ground in response? He must be a significant shareholder in Uber and obviously is still a board member. The lawsuit by Benchmark alleging fraud was one level of desperation. I mean Becnhmark gave Travis the power to fill those board seats and now they have buyer's remorse? You get no sympathy from me. This does raise obvious questions about what the lawsuit will reveal.
spraak 9y ago
Off topic: wow, someone who uses a diaeresis!
- quickthrower2 9y ago
  I didn't know what a diaresis was. I was a bit naive (!). Thanks
- elmar 9y ago
  The Curse of the Diaeresis http://www.newyorker.com/culture/culture-desk/the-curse-of-the-diaeresis http://www.newyorker.com/culture/culture-desk/the-curse-of-t...
  - frandroid 9y ago
    > And yet we use the diaeresis for the same reason that we use the hyphen: to keep the cow out of co-workers.
- StavrosK 9y ago
  Finally, I can spell noöne properly!
- sctb 9y ago
  We detached this subthread from https://news.ycombinator.com/item?id=15011627 https://news.ycombinator.com/item?id=15011627 and marked it off-topic.
darkstar999 9y ago
> Uber is the most important and promising company of our generation. Give me a break. Are you curing cancer? Are you solving hunger? Are you fixing climate issues? I hate when employers talk like salesmen to their employees.
- drak0n1c 9y ago
  They are certainly exaggerating, but the service is a social good - my mother and other elderly and disabled without cars have more independence and freedom to do things around town without spending exorbitant sums on finicky taxis, or spending an hour or more in buses.
  - RodericDay 9y ago
    Uber is most definitely not good for people with disabilities http://www.thedailybeast.com/uber-disability-laws-dont-apply-to-us http://www.thedailybeast.com/uber-disability-laws-dont-apply... https://www.nytimes.com/2017/07/18/nyregion/uber-disabilities-lawsuit-new-york-city.html https://www.nytimes.com/2017/07/18/nyregion/uber-disabilitie...
  - aphextron 9y ago
    I'd agree that the concept of ride sharing is great. But Uber's execution of it has been a complete travesty. The precedent they set for people not expecting to tip drivers has set the standard for all "sharing economy" apps that came after. It is downright deceptive how they presented the service as "tips included" at first. On top of that, their technology is nothing that can't be copied and done better. I think Lyft is going to eat their lunch in the long run.
    - JumpCrisscross 9y ago
      > the concept of ride sharing is great...Uber's execution of it has been a complete travesty Most cities would have no ride sharing industry to speak of had it not been for Uber de-fanging the taxi industry.
umanwizard 9y ago
> The search for a new CEO started over 50 days ago. It was at the same time that Travis agreed in writing to modify the company’s voting agreement to ensure that the board was composed of independent, diverse, and well qualified directors. Despite agreeing in writing to sign these amendments, he has still not done so. I'm having trouble wrapping my head around what the legal difference is between "agreeing in writing to sign something" and "signing something". Anyone familiar with contract law want to chime in?
- dmurray 9y ago
  Not a lawyer, but you can have a contract to sign a contract. In fact this is normal in, for example, merger dealings and even smaller issues like buying a house: you first sign an agreement that says, after certain due diligence, you'll sign another agreement. The original agreement may or may not specify penalties for defaulting on it and not signing the second agreement, and if sued for breaching the first agreement, a court might not hold you to signing the second agreement. In this case, the first agreement definitely isn't enough to modify the company's articles of incorporation.
- ABCLAW 9y ago
  Say you sell wizards from the university of manchester. Say I want a wizard from the university of manchester. If you and I sign a document that says umanwizard sells me a umanchesterwizard with all the little deets like price and timing of delivery and such, then we've reached an agreement. If you and I sign a document that says we will put together a purchase in the future, however, we explicitly are acknowledging that we haven't signed the aforementioned document yet. Depending on the facts and jurisdiction, some places deal with these situations differently, but in common law generally an agreement to agree is not the agreement, and is a non-binding promise. That said, this is very general and you should speak with a lawyer (because i am not yours) if you want a fast and firm answer in a specific situation.
  - umanwizard 9y ago
    Awesome explanation, thanks! FWIW, the jurisdiction in this case seems to be Delaware. Nobody can know what the facts are until a court or jury determines them...
dasil003 9y ago
> But we acted out of a deep conviction that it would be better for Uber, its employees, and investors to have a fresh start. Bull-fucking-shit. Don't condescend to us and pretend like you have the employees' interests at heart. I have no great love for Travis, but come on don't act like this isn't about getting your returns. The letter would have a lot more credibility if they just came out and admitted what is obvious to everyone.
- prostoalex 9y ago
  Are Benchmark's interests not aligned with employees' interests in this case? They would have preferred stock, so it seems like there's plenty of scenarios where they extract benefit, but common stockholders don't, there's one scenario - perfect execution - where common stockholders benefit while Benchmark benefits enormously, but there are zero scenarios where common stockholders do well, but Benchmark doesn't.
  - mark_element 9y ago
    Benchmark here has quite different time pressure than potential common stock holders. They need to get liquid.
    - JumpCrisscross 9y ago
      > They need to get liquid Benchmark or Uber's employees who hold illiquid common stock?
      - sah2ed 9y ago
        Benchmark. At least that's according to this throwaway but highly upvoted comment [0] from some days ago. [0] https://news.ycombinator.com/item?id=14983957 https://news.ycombinator.com/item?id=14983957
        prostoalex 9y ago
        The urgency is never quite explained. If Benchmark needs to wind down a fund, they can just distribute shares directly to LPs.
exogeny 9y ago
Come on, guys. You all are smart enough to read between the lines. Benchmark is desperate to get out. Why do you think that is? Do you think they'd be all hands on deck trying to get out of a rocket ship investment? Of course not. Uber's unit economics are garbage, and will remain garbage until self-driving technology becomes universal. That will not happen in a timeframe that Benchmark is comfortable with - or to put it another way, within the preferred close dates of their fund - and even if it did, they clearly have little confidence that the current leadership (or lack thereof) are the right operators, either now or in the future. The ship is sinking. They want out. Softbank wants in - for reasons I can't understand other than they have the money and want to spray it around aimlessly - and this bit of messiness is surely throwing a wrench into the plans.
- furioussloth 9y ago
  As much as you and many on the HN like it. Ship is not sinking at least not any time soon. If all they wanted was a way out why tarnish their own image by filing this law suit and make benchmark look less founder-friendly and supposedly create leaks which make Uber look even worse. Making Uber look like a bad investment is possibly something they don't want to do if they want $$$ for their existing shares.
  - leroy_masochist 9y ago
    > If all they wanted was a way out why tarnish their own image by filing this law suit and make benchmark look less founder-friendly and supposedly create leaks which make Uber look even worse. Because they're trying to shape the battlespace of public debate to create the best possible conditions for a resolution of this standoff in a way that gives them liquidity for their investment at a valuation approaching Uber's last round.
  - warcher 9y ago
    I'd like to hear your reasoning that the ship isn't sinking. My reasoning is their burn rate, unit economics, the writedowns, and VC's taking some controversial hardball steps to protect downside risk. Since they're private, there's not much real data to be had, but that's a lot of smoke for no fire. Anecdotally, I have seen up close what it looks like when suit-and-tie MBA types start looking for the emergency exit, and this smells right. BUT What I don't know would fill volumes-- whaddya got?
etr71115 9y ago
"I have come to bury Travis, not praise him." Last time I checked, Benchmark has one board seat? A bit bizarre for them to assert themselves (note the plural) as a benevolent agent for employees. I know 'corporations are people too', but how are employees supposed to respond to this letter? They're not. This is a PR release. Good thing "this isn’t about Benchmark versus Travis." The CFO inclusion screams IPO, which, consequently, is all this comes down to: money. Benchmark wants to cash out. Entrepreneurs will still work with Benchmark. Yes, they'll push you out a la Twitter and Uber style, but, at the very least, you'll be a billionaire by the time they do.
- frandroid 9y ago
  The pro-Travis side of the board is trying to get Benchmark to sell its shares to them. It seems that they have a good cash-out option in front of them that doesn't not require an IPO!
  - fosk 9y ago
    Yes, at a 30% discount. Seems like Benchmark is pursuing other options to avoid selling at a lower price (although with a huge return on their investment regardless).
    - smallgovt 9y ago
      Is there a source for the 30% figure or is that an assumption?
    - frandroid 9y ago
      Yeah, at a huge return, and they could make that value higher if they were to start negotiations.
deleted 9y ago
[deleted]
hownottowrite 9y ago
The letter appears to be authored by Kris Fredrickson, presumably the same Kris Fredrickson listed as an Investor/Principal at Benchmark.
kumarski 9y ago
LTV faking only works sometimes: Worked: SocialCam Failed: Uber HomeJoy Sprig Etc...
AJRF 9y ago
"Uber is the most important and promising company of our generation." That is a totally delusional statement. The current status of Uber's decline is a direct contradiction to this very line. Uber isn't anything special. A case could be made to say that Travis is special, an exceptional force that bulled his way through red tape and created a lot of value for shareholders and users of Uber, but Uber, as a company is nothing more than a very nice brand, which has now turned bad. You can see this in every market they try to capture, fail and end up partnering with others in. These kind of statements are why people take the piss out of the Silicon Valley thought bubble. Uber augments the middle class by providing convenience functions on their phone. That is not going to change the world. Not one bit.
- elmar 9y ago
  > Uber isn't anything special. A case could be made to say that Travis is special in my opnion a very strong case, if you compare it to a proxy like Lyft, very competent funding team they preceded Uber by several years [1], add access to the same pools of capital and talent and probably are worth 10% of Uber and only have a regional impact on US not the rest of the world. So what is special about Uber? Travis is. ------------------------------------ [1] The first company with the ability to get everyday cars with drivers was SideCar, Lyft copied SideCar, Uber copied SideCar. Paul developed his concept for mobile ride-hailing over a wireless network, applied for a patent in 2000 and was granted U.S. patent 6356838 “System and method for determining an efficient transportation route” in 2002. Paul turned his idea into reality. He co-founded San Francisco startup Sidecar, which offers paid rides by private drivers in their own cars, summoned by passengers over a wireless network. http://www.google.com/patents/US6356838 http://www.google.com/patents/US6356838
  - elmar 9y ago
    quoting Greylock here: If we rewind the clock to 2012, Lyft launched a peer-to-peer ridesharing service and Uber was a black car marketplace. Lyft and Sidecar’s P2P taxis were a bigger idea in a bigger space. And like most marketplaces, it was a winner-take-all opportunity, or at least a winner-take-most. At the time, all three companies were only in SF and everyone was racing towards liquidity, with sights to have a right of first refusal on every other city in the country thereafter. Lyft had a big head start, but Uber was trailing right behind. Uber began to aggressively put its war chest to work to achieve liquidity as fast as possible. This meant enabling ~5 minute pickups for riders and ~$25 hourly earnings for drivers. First, it guaranteed drivers hourly rates and spent money to acquire drivers. With drivers on the road, Uber focused on filling their cars through paid channels and incentivizing referrals. In a nutshell, the company subsidized fares and gave away free rides until there was enough demand and drivers could earn enough on their own. City by city, Uber implemented this playbook — buying drivers, buying passengers, subsidizing rides — to shave minutes off the pickup SLA and increase driver earnings, propelling Uber to liquidity. In short, Uber burned cash to get more drivers and more customers on the road. As availability went up and the marketplace became stable, Uber got closer to profitability and could scale faster. ----------------- Sidecar: ‘We failed because Uber is willing to win at any cost’ (2016) https://venturebeat.com/2016/01/20/sidecar-we-failed-because-uber-is-willing-to-win-at-any-cost/ https://venturebeat.com/2016/01/20/sidecar-we-failed-because...
blizkreeg 9y ago
What cowards for hiding behind the cover of "we care so much about this once in a lifetime company" (cough, investment). So all this while, when Travis was fucking up but building Benchmark a giant return on their investment, they were fine with his behavior. And now they're calling it out?! So basically Benchmark's people on the board are incompetent.
georgeecollins 9y ago
Going for two years without a CFO at a company of this scale is enough reason to justify a management change, full stop.
samstave 9y ago
"Uber is the most important and promising company of our generation" THen fuck you. Why wasn't, mr. VC, "taxi companies and their rates and availability and regulations and customer dissatisfaction the most important and disuptional problem of our generation" of the past? "oh look - people want this! Arent we innovative. Oh shoot! look people are pissed when the company still acts like douchebags! Why would they act like that?" -- I love the uber product, hate the player and all that... b ut give me a fucking break - uber is a taxi, as taxi's should be and self-driving cars are the next inCARnation of said service - but stop patting yourself where you can see that they acted like many disruptors who come into big money do... it is not a surprise. Uber is a very interesting litmus to the state of things - the confluence of big money, big problems is amazing: * 1. female engineering drama * 2. ceo drama * 3. legal drama * 4. funding/VC drama * 5. employees love/hating drama (tech issues are cool and all - but fuck this place) * 6. user drama * 7. data drama * 8. driver drama --- 1. sexist blah - we know this one 2. sexist blah, douchebaggery blah -- now the ousting... 3. cities/states/countries banning them 4. raised how much for what? uber car leasing/VC battles, waymo, etc 5. employees love the eng - hate the grind/sexism/bro-bullshit 6. many complaints, new complaints, better than those on Richess. What about the lame "party button" that I already wrote about - lamest contest mode ever "compete for a spot to exclusive lame party - we will pick you up and drop you off to a specific location... OH, You want a ride home from said undisclosed location; FUCK YOU - stand at the corner and cal a surge uber like every other pleb, you moron" 7. No access to any recent data - but we will use it against all our drivers. 8. Here, hold my hammer in your skull for a sec.
- askafriend 9y ago
  Please keep this type of inane content on Reddit. It is not welcome here.
  - samstave 9y ago
    please keep this inane bullshit comment to yourself... go act superior [OVER THERE]
    - 9y ago
smallgovt 9y ago
IMO, this was a clever PR move on Benchmark's part. Benchmark needs to limit any reputational damage that results from the ensuing battle. In order to do that, they need to justify their actions to the public. Engaging with journalists directly is suboptimal because it lets the journalist control the narrative which will naturally paint them in a defensive light. Addressing the public via a "letter to employees" allows them to fully control the narrative, defend their actions while not seeming defensive, and paint the picture that they are looking out for the greater good. Of course, we all know that Benchmark is self-interested. Their goals are: - Liquidate their investment ASAP via a private transaction (e.g. Softbank) or IPO - Protect the value of their investment until liquidation event occurs - Limit any reputational damage to their firm Everything they do can probably be explained by at least one of these objectives. And, it should be obvious that they don't genuinely care about Uber's employees -- only to the extent that it preserves the value of their investment (i.e. preventing substantial attrition).
- mychael 9y ago
  Spot On
uberemployee 9y ago
As an Uber employee, I can say this: although the feelings on TK are mixed (some loving TK, others glad that he's gone), the feelings about Benchmark are pretty uniform. They are only out for themselves, and nothing they have done have "helped" us. They have only hurt us. This current ploy they are doing is only further hurting us. Everyone thinks this "letter" is a joke. Nothing to see here, at least from an employee perspective.
- BinaryIdiot 9y ago
  Interesting. As far as I can tell (from the outside, of course) Travis is reneging on his deal and he's planning on reinstalling himself as CEO in addition to the extra board seats he just procured. This seems like it would hurt employees more than anything and possibly give Travis even more control over the company. To me it appears Benchmark is mostly aligned with employees; both want the company to grow and do well. So why do many have bad feelings about Benchmark's actions? What am I missing?
  - smallgovt 9y ago
    Benchmark's interest lies in protecting the value of their investment and liquidating it as soon as possible. This can be very different from employees' interest in the case where Benchmark seeks to sell their stake via a private transaction (e.g. to Softbank). I'd also add that Benchmark couldn't care less if the company 'grows'. They've already made enough money to return their fund many times over. Their strategy now is mainly to mitigate risk to the paper value of their holdings.
    - BinaryIdiot 9y ago
      Fair point. I can't exactly blame them either.
- deleted 9y ago
  [deleted]
- tschellenbach 9y ago
  Founders and employees typically own common stock. Investors will have preferred stock with different rights. Depending on the deal specifics this will give VCs different incentives for the company. So yeah I can't imagine that employees are very happy about this change of control.
uhhhhhhh 9y ago
This seems conflicting: >It was at the same time that Travis agreed in writing to modify the company’s voting agreement to ensure that the board was composed of independent, diverse, and well qualified directors. Despite agreeing in writing to sign these amendments, he has still not done so. then >A number of people have asked why we took legal action before giving Travis the chance to sign these amendments. It doesn't sound like he agreed in writing yet based on their own words. Maybe that's just bad wording though. They also fail to point to any actual actions taken on his part, just references to vague statements or inferences of inaction. Not to say I'm on Travis's side of this, but from what I've read its much more likely Benchmark is trying to stabilize leadership under someone who will focus on shareholder value (not company growth/stability) as they need to divest themselves within the next year or two. This obviously stands contrary to what Travis supposedly wants (and has failed to accomplish), and probably much of the rest of the board.
toephu2 9y ago
"his continued involvement in the day-to-day running of the company" Question to Uber employees: Does Travis still come into the office everyday?
kerkeslager 9y ago
> Uber is the most important and promising company of our generation. If Uber is the best our generation has to offer, the future is doomed.
idibidiart 9y ago
The human race is facing slow but almost certain extinction (if things don't change radically) and people in tech (who can potentially do something about it) are wasting their precious bandwidth debating who's right and who's wrong. Everyone is wrong. Except for Elon Musk of course!
thinbeige 9y ago
This letter is pure Machiavellism. 'It's not Benchmark vs Travis.' BS. Basically, they try to involve the employees and bring them up against Travis. Travis should fight back, and hit Benchmark as hard as possible, so Benchmark looses all their reputation forever.
foobar8732 9y ago
I think a lot less of Benchmark reading this. 1. They are in business to make money. Not to make uber a company it's employees can be proud of. Writing a letter that's somewhere between insulting and pandering is stupid. 2. Keeping your name off the letter? Reflects their general cowardice.
abovethecrow 9y ago
Bill Gurley is a clear vulture waiting for his opportunity and worried. Travis is definitely not a gentleman known fact from his video which the driver posted. I always wonder why they got to be so nasty and squeeze the little people. I visited Uber and I felt that place was more of bar with the light settings in the lunch room. So many hastags outside the conference rooms e.g. #pumpedup.. pure sh.
wbillingsley 9y ago
In other news, I hear the SPECTRE board is also scratching its head why it's struggling to find a popular replacement for Ernst Stavro Blofeld in its CEO position. While they had a bit of difficulty around that Nine Eyes launch, the numbers in its Extortion business are growing phenominally, and investors just can't understand why up-and-coming executives wouldn't want to associate themselves with its brand and lead arguably the most important and exciting business of our generation.

244 points by ted0 9y ago

Jeez, not trying to defend Travis, but the guy did create an umpteen billion dollar company in short order, creating absurd value for Benchmark's investment. The least they could do is start off with a hollow thank you and acknowledgement for that achievement. Apparently all Travis did was make mistakes. It really does smell more like a vendetta and less like them protecting their money.

JumpCrisscross 9y ago
> all Travis did was make mistakes If this letter's claims are true, Kalanick agreed, in writing, "to modify the company’s voting agreement to ensure that the board was composed of independent, diverse, and well qualified directors." He then defaulted on that written agreement with Uber's Board. That's a pretty serious mistake. Disclaimer: I am not a lawyer. This is not legal nor investment advice.
- mike_hearn 9y ago
  Is it? Does putting something in writing automatically force you to do it, legally, if that writing is not a contract? Perhaps the mistake here is Benchmark's. If Kalanick agreed to do this in writing, and then didn't do it, that makes him look bad but it's unclear to me that Benchmark can do much about it. Maybe Travis has the last laugh.
  - JumpCrisscross 9y ago
    > Does putting something in writing automatically force you to do it, legally, if that writing is not a contract? It's unclear from the letter if this agreement was a contract or e.g. an email. If a contract, the answer is clear. If something less formal, note that American courts tend to treat written communications between sophisticated parties as legally binding, particularly if it occurs around negotiating a contract [1]. There's the further distinction that these are written communications between a CEO and his Board. At the very least, Kalanick made untrue statements to his investors. If he did it intentionally, it could constitute fraud. [1] https://www.law360.com/articles/950866/bank-bound-by-unsigned-lehman-deal-despite-dismissal https://www.law360.com/articles/950866/bank-bound-by-unsigne... Disclaimer: I am not a lawyer. This is not legal nor investment advice.
    - tannhauser23 9y ago
      If that was in a contract, Benchmark wouldn't have to sue for 'fraud' - they can sue to enforce the contractual agreement. Sounds like what they have on paper isn't as solid as they'd like you to believe.
  - dcole2929 9y ago
    Generally, yes it does require you to do so unless you also have it in writing that whatever document you just signed is not in fact binding. Even verbal agreements can be enforced as a legally binding contract so having a written document is a pretty high barrier to overcome legally speaking.
  - Powerofmene 9y ago
    In the US, generally it is binding. Communications and agreements between parties are binding particularly if TK received something in return for said promises. Even verbal agreements are binding in the US especially when dealing with parties such as these. If TK hopes to have any credibility moving forward, with the Board or in the courts, it would be in his best interest to keep commitments or he will be stuck in the "did you lie then or is this version a lie" mess. If he wants to argue that he made the agreement under duress then he can argue that in court and the court may find the the agreement is not enforceable but duress can be a steep hill to climb without physical, or threat of physical, harm.
smallgovt 9y ago
Discrediting Travis (read: vendetta) is the means through which Benchmark seeks to protect their investment. In order to liquidate their investment, Uber needs to IPO or Benchmark needs to find another investor to buy them out. Travis is a staunch opponent to an IPO. And, replacing Travis as CEO is a likely pre-condition to finding another investor who will buy Benchmark out. Either way, discrediting and removing Travis and protecting their money is more or less one in the same.
- bjl 9y ago
  Benchmark doesn't need to discredit Travis, he did a mighty fine job of that on his own.
warcher 9y ago
So, this might be me just being dumb, but I don't understand how Benchmark has made any money whatsoever on this deal. Not yet. And what I mean by that is this: they gave Uber money for shares. But they have not yet sold the shares to anybody, b/c no acquisition or IPO. Other investors buy more shares, but that's not a liquidity event, is it? Benchmark has a whole boatload of paper profits that they can't return to their LPs, not yet at least. Or am I crossed up here? Could they, or have they, done some kind of private sale? I kind of doubt it but could easily be wrong here. Is there some kind of financial instrument to cash out early I'm ignorant of?
- fullshark 9y ago
  They may have taken out a loan using the book value of Uber and re-invested it.
- dumbfounder 9y ago
  That's why I said value and not actual return on investment. They have created an insane amount of value in the stock that Benchmark owns. If you were an investor would you rather take the money that Benchmark originally invested, or the stock they received for it? Pretty easy answer unless you think they will go bankrupt.

zitterbewegung 9y ago

Is this being sent to "Contractors" (drivers) and Employees or just Employees?

ted0 9y ago
I would assume that it is not being sent to drivers.
- anindha 9y ago
  "We have tremendous respect for the incredible work you do to provide this vital service in cities all around the world and to create work opportunities for millions of people globally." Suggests that it is addressed to employees creating jobs, which would be the full time employees.
- Theodores 9y ago
  It is addressed carefully to all Uber staff - we know they don't have normal staff with drivers. I think 'the umpire has spoken' and that Benchmark know that this well crafted letter will carry enough weight to be heard by everyone. I think it is a masterstroke by them to write like this.

hkmurakami 9y ago

This letter reads as faceless (who's Benchmark's representative on the board as of now anyways?) and a bit condescending to me. "We've never interacted with you in the past, but trust us, we're on your side and have your best interests in mind." Not sure what this letter is supposed to accomplish. Employees who were behind Benchmark already will continue to support them, and employees who were behind Travis will continue to support him, and if anything, the polarization will increase with this message.

JumpCrisscross 9y ago
> Not sure what this letter is supposed to accomplish Communicate why Benchmark acted in a manner they find to be reasonable? Assuming every single one of Uber's employees don't divide into neat pro-Benchmark and pro-Kalanick camps, this could help keep nervous minds put. Disclaimer: This comment is NOT investment advice. Please do not buy or sell any securities based on it.
- Gargoyle 9y ago
  I don't work at uber, but this letter communicates nothing but drama and uncertainty to me. I can't imagine it put anyone's mind to rest.
  - JumpCrisscross 9y ago
    > his letter communicates nothing but drama and uncertainty This letter or the lawsuit? The suit certainly communicated drama and uncertainty, though if the accusations in this letter are true, it might have been a calculated judgment that lots of drama now is better than a slow drip over years. After filing the lawsuit, Benchmark could (a) stay silent, leaving everyone guessing (and letting the machinations they accuse Kalanick of orchestrating continue to work their rot) or (b) explain their actions. They chose (b).
deleted 9y ago
[deleted]
tyingq 9y ago

mbesto 9y ago

> Uber’s excellent executive leadership team is making commendable progress on these changes, many of the most important issues agreed to by the board remain unaddressed. And so who precisely is Uber's "excellent executive leadership team" comprised of? No COO, CFO, and CEO...

beager 9y ago

Methinks the fact that this letter has gone out to rank-and-file employees at Uber signals a very tumultuous cultural impasse that the board is having a huge amount of difficulty clearing.

anindha 9y ago

No mention of the IPO disagreement. I wonder if most Uber employees would be for or against an IPO. I am sure many would want to cash out at this point and might support Benchmark for that reason alone.

evanlivingston 9y ago

"uber is the most important and promising company of our generation" If that's true, I'm scared.

caser 9y ago
It makes more sense if you replace "our generation" with "our portfolio."
nostrademons 9y ago
The audience of this letter is Uber employees, and the context is that the faceless VC who just pushed out their CEO is trying to gain their trust. I think a little flattery here is in Benchmark's interest, true or not. FWIW, Uber is very far from the most important and promising company of our generation in my mind.
curiousDog 9y ago
Most Uber employees I've talked to think Uber is the next Google.
- deleted 9y ago
  [deleted]
notyourday 9y ago
It is the most important company in their portfolio and they are afraid that should their investment in Uber not payoff int he most spectacular fashion, they themselves would find out just how difficult it is to raise money after being labeled as a failure. [edit: Payoff in a most spectacular fashion here means "exited at nearly the top of the valuation"]
hsod 9y ago
It's probably the company that has had the most concrete impact on my life and the lives of my friends of this generation (depending on how you define generation).
- 9y ago

jtchang 9y ago

When reading letters like this always be aware of the interests of all the parties involved and what they have to gain. Benchmark has a lot to lose if Uber starts bleeding talent (especially so in the engineering department). And it is there investment at stake if they can't turn the tide. I'm not advocating for one side or the other but there is a lot of money involved and when that happens you have to be very vigilant of who is espousing for what.

cbtacy 9y ago

This suggests that the full Holder report has some real, ugly dirt in it.

rdiddly 9y ago
Yes... leak please!

ChuckMcM 9y ago

Another interesting move on Benchmark's part. I wonder if this is the key sentence: "Travis’s failure to make good on this promise, as well as his continued involvement in the day-to-day running of the company, has created uncertainty for everyone, undermining the success of the CEO search." One of the key things about organizations which isn't always apparent is that leadership isn't "given" it is earned. This is often used as a tool in story telling where the hero's actions inspire people to follow them and so even though someone else is the "boss" the people are following the "hero." That they are complaining about Travis, who, AFAICT, does not even have an employee role at all in the company, continues to be "involved" in day to day operations, suggests that his lack of co-operation is the issue and Travis is, or continues to be depending on your point of view, the 'bad actor' in this situation. Sometimes you have classes where they throw out a hypothetical question like "What if you fired the boss and he didn't leave?" If Travis is able to exert that level of control over the company then clearly he continues to have people loyal to him doing as he asks against the wishes of the board. I can imagine that this would make it extremely hard to manage a company in that situation.

throwaway0071 9y ago
The fact that Travis doesn't want to let go of Uber is completely normal. He is the founder, the boss, the guy with lots of money. There's a power play in place and people don't know who will win. It's normal that employees at all levels will still give him some leverage. It doesn't say anything about employee loyalty or Travis being the leader they want.
- deleted 9y ago
  [deleted]
OzzyB 9y ago
> Travis’s failure to make good on this promise Is this what happens when a CEO has a large voting block of shares (b/c he's smart enough to learn from previous founders' experience with VCs), and a VC firm that finds they can't have it their way (like they've been used to), publicly shame him for "not doing what he promised (us)"? Last I checked they ousted _him_ and now they want to play "victim" because they're finding it hard to find a replacement? Maybe none feels they're able to fill his shoes or do as good a job as he's done? Last I checked Uber was still a tremendous success regardless of all their bad press and missteps/deeds. Sorry, I just find it hard to sympathize with these people.

cocktailpeanuts 9y ago

I wonder how Uber employees actually feel about this, it sounds really condescending and tone deaf. If I was working at Uber I would be like "Who are you to suddenly show up and act like mom?"

Twirrim 9y ago

Do we know this is genuine? All I'm seeing is an unsigned PDF, stored in google drive, purporting to be from Benchmark.

sah2ed 9y ago
Funny thing is someone linked to Benchmark's twitter demonstrating the authenticity of the PDF in a reply to you. But refreshing this page and the post has now being deleted. https://twitter.com/benchmark/status/897144805762793472 https://twitter.com/benchmark/status/897144805762793472
- Stratoscope 9y ago
  When I click your link, the tweet is there. Must have been a glitch?
  - carb 9y ago
    @sah2ed actually meant that a HN comment had linked the tweet they did. I saw it there too. The tweet itself was never deleted.
    - sah2ed 9y ago
      Yes, was referring to a HN comment. The original comment [0] had an id of 15011549. [0] https://news.ycombinator.com/item?id=15011549 https://news.ycombinator.com/item?id=15011549
      - Stratoscope 9y ago
        D'oh! That's what I get for not reading carefully. Thanks for clearing up my puzzlement! :-)
- Twirrim 9y ago
  Thanks.
deleted 9y ago

ProfessorLayton 9y ago

I really want to read the "Holder Report". Reading from this context, it sounds like it may be pretty damning.

vkrm 9y ago
There's a part of it here: https://www.nytimes.com/interactive/2017/06/13/technology/document-The-Holder-Report-on-Uber.html https://www.nytimes.com/interactive/2017/06/13/technology/do...

cletus 9y ago

Wow. Is there any precedent for this? Where the board is at war and the investors mail the employees? They must be utterly desperate for a fire sale IPO at this point. How is something like this not meant to spook other investors, employees and potential CEOs? I do wonder if Travis is miffed at his ousting. Probably. But is he willing to burn the company to the ground in response? He must be a significant shareholder in Uber and obviously is still a board member. The lawsuit by Benchmark alleging fraud was one level of desperation. I mean Becnhmark gave Travis the power to fill those board seats and now they have buyer's remorse? You get no sympathy from me. This does raise obvious questions about what the lawsuit will reveal.

spraak 9y ago

Off topic: wow, someone who uses a diaeresis!

quickthrower2 9y ago
I didn't know what a diaresis was. I was a bit naive (!). Thanks
elmar 9y ago
The Curse of the Diaeresis http://www.newyorker.com/culture/culture-desk/the-curse-of-the-diaeresis http://www.newyorker.com/culture/culture-desk/the-curse-of-t...
- frandroid 9y ago
  > And yet we use the diaeresis for the same reason that we use the hyphen: to keep the cow out of co-workers.
StavrosK 9y ago
Finally, I can spell noöne properly!
sctb 9y ago
We detached this subthread from https://news.ycombinator.com/item?id=15011627 https://news.ycombinator.com/item?id=15011627 and marked it off-topic.

darkstar999 9y ago

> Uber is the most important and promising company of our generation. Give me a break. Are you curing cancer? Are you solving hunger? Are you fixing climate issues? I hate when employers talk like salesmen to their employees.

drak0n1c 9y ago
They are certainly exaggerating, but the service is a social good - my mother and other elderly and disabled without cars have more independence and freedom to do things around town without spending exorbitant sums on finicky taxis, or spending an hour or more in buses.
- RodericDay 9y ago
  Uber is most definitely not good for people with disabilities http://www.thedailybeast.com/uber-disability-laws-dont-apply-to-us http://www.thedailybeast.com/uber-disability-laws-dont-apply... https://www.nytimes.com/2017/07/18/nyregion/uber-disabilities-lawsuit-new-york-city.html https://www.nytimes.com/2017/07/18/nyregion/uber-disabilitie...
- aphextron 9y ago
  I'd agree that the concept of ride sharing is great. But Uber's execution of it has been a complete travesty. The precedent they set for people not expecting to tip drivers has set the standard for all "sharing economy" apps that came after. It is downright deceptive how they presented the service as "tips included" at first. On top of that, their technology is nothing that can't be copied and done better. I think Lyft is going to eat their lunch in the long run.
  - JumpCrisscross 9y ago
    > the concept of ride sharing is great...Uber's execution of it has been a complete travesty Most cities would have no ride sharing industry to speak of had it not been for Uber de-fanging the taxi industry.

umanwizard 9y ago

> The search for a new CEO started over 50 days ago. It was at the same time that Travis agreed in writing to modify the company’s voting agreement to ensure that the board was composed of independent, diverse, and well qualified directors. Despite agreeing in writing to sign these amendments, he has still not done so. I'm having trouble wrapping my head around what the legal difference is between "agreeing in writing to sign something" and "signing something". Anyone familiar with contract law want to chime in?

dmurray 9y ago
Not a lawyer, but you can have a contract to sign a contract. In fact this is normal in, for example, merger dealings and even smaller issues like buying a house: you first sign an agreement that says, after certain due diligence, you'll sign another agreement. The original agreement may or may not specify penalties for defaulting on it and not signing the second agreement, and if sued for breaching the first agreement, a court might not hold you to signing the second agreement. In this case, the first agreement definitely isn't enough to modify the company's articles of incorporation.
ABCLAW 9y ago
Say you sell wizards from the university of manchester. Say I want a wizard from the university of manchester. If you and I sign a document that says umanwizard sells me a umanchesterwizard with all the little deets like price and timing of delivery and such, then we've reached an agreement. If you and I sign a document that says we will put together a purchase in the future, however, we explicitly are acknowledging that we haven't signed the aforementioned document yet. Depending on the facts and jurisdiction, some places deal with these situations differently, but in common law generally an agreement to agree is not the agreement, and is a non-binding promise. That said, this is very general and you should speak with a lawyer (because i am not yours) if you want a fast and firm answer in a specific situation.
- umanwizard 9y ago
  Awesome explanation, thanks! FWIW, the jurisdiction in this case seems to be Delaware. Nobody can know what the facts are until a court or jury determines them...

dasil003 9y ago

> But we acted out of a deep conviction that it would be better for Uber, its employees, and investors to have a fresh start. Bull-fucking-shit. Don't condescend to us and pretend like you have the employees' interests at heart. I have no great love for Travis, but come on don't act like this isn't about getting your returns. The letter would have a lot more credibility if they just came out and admitted what is obvious to everyone.

prostoalex 9y ago
Are Benchmark's interests not aligned with employees' interests in this case? They would have preferred stock, so it seems like there's plenty of scenarios where they extract benefit, but common stockholders don't, there's one scenario - perfect execution - where common stockholders benefit while Benchmark benefits enormously, but there are zero scenarios where common stockholders do well, but Benchmark doesn't.
- mark_element 9y ago
  Benchmark here has quite different time pressure than potential common stock holders. They need to get liquid.
  - JumpCrisscross 9y ago
    > They need to get liquid Benchmark or Uber's employees who hold illiquid common stock?
    - sah2ed 9y ago
      Benchmark. At least that's according to this throwaway but highly upvoted comment [0] from some days ago. [0] https://news.ycombinator.com/item?id=14983957 https://news.ycombinator.com/item?id=14983957
      - prostoalex 9y ago
        The urgency is never quite explained. If Benchmark needs to wind down a fund, they can just distribute shares directly to LPs.

exogeny 9y ago

Come on, guys. You all are smart enough to read between the lines. Benchmark is desperate to get out. Why do you think that is? Do you think they'd be all hands on deck trying to get out of a rocket ship investment? Of course not. Uber's unit economics are garbage, and will remain garbage until self-driving technology becomes universal. That will not happen in a timeframe that Benchmark is comfortable with - or to put it another way, within the preferred close dates of their fund - and even if it did, they clearly have little confidence that the current leadership (or lack thereof) are the right operators, either now or in the future. The ship is sinking. They want out. Softbank wants in - for reasons I can't understand other than they have the money and want to spray it around aimlessly - and this bit of messiness is surely throwing a wrench into the plans.

furioussloth 9y ago
As much as you and many on the HN like it. Ship is not sinking at least not any time soon. If all they wanted was a way out why tarnish their own image by filing this law suit and make benchmark look less founder-friendly and supposedly create leaks which make Uber look even worse. Making Uber look like a bad investment is possibly something they don't want to do if they want $$$ for their existing shares.
- leroy_masochist 9y ago
  > If all they wanted was a way out why tarnish their own image by filing this law suit and make benchmark look less founder-friendly and supposedly create leaks which make Uber look even worse. Because they're trying to shape the battlespace of public debate to create the best possible conditions for a resolution of this standoff in a way that gives them liquidity for their investment at a valuation approaching Uber's last round.
- warcher 9y ago
  I'd like to hear your reasoning that the ship isn't sinking. My reasoning is their burn rate, unit economics, the writedowns, and VC's taking some controversial hardball steps to protect downside risk. Since they're private, there's not much real data to be had, but that's a lot of smoke for no fire. Anecdotally, I have seen up close what it looks like when suit-and-tie MBA types start looking for the emergency exit, and this smells right. BUT What I don't know would fill volumes-- whaddya got?

etr71115 9y ago

"I have come to bury Travis, not praise him." Last time I checked, Benchmark has one board seat? A bit bizarre for them to assert themselves (note the plural) as a benevolent agent for employees. I know 'corporations are people too', but how are employees supposed to respond to this letter? They're not. This is a PR release. Good thing "this isn’t about Benchmark versus Travis." The CFO inclusion screams IPO, which, consequently, is all this comes down to: money. Benchmark wants to cash out. Entrepreneurs will still work with Benchmark. Yes, they'll push you out a la Twitter and Uber style, but, at the very least, you'll be a billionaire by the time they do.

frandroid 9y ago
The pro-Travis side of the board is trying to get Benchmark to sell its shares to them. It seems that they have a good cash-out option in front of them that doesn't not require an IPO!
- fosk 9y ago
  Yes, at a 30% discount. Seems like Benchmark is pursuing other options to avoid selling at a lower price (although with a huge return on their investment regardless).
  - smallgovt 9y ago
    Is there a source for the 30% figure or is that an assumption?
  - frandroid 9y ago
    Yeah, at a huge return, and they could make that value higher if they were to start negotiations.

deleted 9y ago

[deleted]

hownottowrite 9y ago

The letter appears to be authored by Kris Fredrickson, presumably the same Kris Fredrickson listed as an Investor/Principal at Benchmark.

kumarski 9y ago

LTV faking only works sometimes: Worked: SocialCam Failed: Uber HomeJoy Sprig Etc...

AJRF 9y ago

"Uber is the most important and promising company of our generation." That is a totally delusional statement. The current status of Uber's decline is a direct contradiction to this very line. Uber isn't anything special. A case could be made to say that Travis is special, an exceptional force that bulled his way through red tape and created a lot of value for shareholders and users of Uber, but Uber, as a company is nothing more than a very nice brand, which has now turned bad. You can see this in every market they try to capture, fail and end up partnering with others in. These kind of statements are why people take the piss out of the Silicon Valley thought bubble. Uber augments the middle class by providing convenience functions on their phone. That is not going to change the world. Not one bit.

elmar 9y ago
> Uber isn't anything special. A case could be made to say that Travis is special in my opnion a very strong case, if you compare it to a proxy like Lyft, very competent funding team they preceded Uber by several years [1], add access to the same pools of capital and talent and probably are worth 10% of Uber and only have a regional impact on US not the rest of the world. So what is special about Uber? Travis is. ------------------------------------ [1] The first company with the ability to get everyday cars with drivers was SideCar, Lyft copied SideCar, Uber copied SideCar. Paul developed his concept for mobile ride-hailing over a wireless network, applied for a patent in 2000 and was granted U.S. patent 6356838 “System and method for determining an efficient transportation route” in 2002. Paul turned his idea into reality. He co-founded San Francisco startup Sidecar, which offers paid rides by private drivers in their own cars, summoned by passengers over a wireless network. http://www.google.com/patents/US6356838 http://www.google.com/patents/US6356838
- elmar 9y ago
  quoting Greylock here: If we rewind the clock to 2012, Lyft launched a peer-to-peer ridesharing service and Uber was a black car marketplace. Lyft and Sidecar’s P2P taxis were a bigger idea in a bigger space. And like most marketplaces, it was a winner-take-all opportunity, or at least a winner-take-most. At the time, all three companies were only in SF and everyone was racing towards liquidity, with sights to have a right of first refusal on every other city in the country thereafter. Lyft had a big head start, but Uber was trailing right behind. Uber began to aggressively put its war chest to work to achieve liquidity as fast as possible. This meant enabling ~5 minute pickups for riders and ~$25 hourly earnings for drivers. First, it guaranteed drivers hourly rates and spent money to acquire drivers. With drivers on the road, Uber focused on filling their cars through paid channels and incentivizing referrals. In a nutshell, the company subsidized fares and gave away free rides until there was enough demand and drivers could earn enough on their own. City by city, Uber implemented this playbook — buying drivers, buying passengers, subsidizing rides — to shave minutes off the pickup SLA and increase driver earnings, propelling Uber to liquidity. In short, Uber burned cash to get more drivers and more customers on the road. As availability went up and the marketplace became stable, Uber got closer to profitability and could scale faster. ----------------- Sidecar: ‘We failed because Uber is willing to win at any cost’ (2016) https://venturebeat.com/2016/01/20/sidecar-we-failed-because-uber-is-willing-to-win-at-any-cost/ https://venturebeat.com/2016/01/20/sidecar-we-failed-because...

blizkreeg 9y ago

What cowards for hiding behind the cover of "we care so much about this once in a lifetime company" (cough, investment). So all this while, when Travis was fucking up but building Benchmark a giant return on their investment, they were fine with his behavior. And now they're calling it out?! So basically Benchmark's people on the board are incompetent.

georgeecollins 9y ago

Going for two years without a CFO at a company of this scale is enough reason to justify a management change, full stop.

samstave 9y ago

"Uber is the most important and promising company of our generation" THen fuck you. Why wasn't, mr. VC, "taxi companies and their rates and availability and regulations and customer dissatisfaction the most important and disuptional problem of our generation" of the past? "oh look - people want this! Arent we innovative. Oh shoot! look people are pissed when the company still acts like douchebags! Why would they act like that?" -- I love the uber product, hate the player and all that... b ut give me a fucking break - uber is a taxi, as taxi's should be and self-driving cars are the next inCARnation of said service - but stop patting yourself where you can see that they acted like many disruptors who come into big money do... it is not a surprise. Uber is a very interesting litmus to the state of things - the confluence of big money, big problems is amazing: * 1. female engineering drama * 2. ceo drama * 3. legal drama * 4. funding/VC drama * 5. employees love/hating drama (tech issues are cool and all - but fuck this place) * 6. user drama * 7. data drama * 8. driver drama --- 1. sexist blah - we know this one 2. sexist blah, douchebaggery blah -- now the ousting... 3. cities/states/countries banning them 4. raised how much for what? uber car leasing/VC battles, waymo, etc 5. employees love the eng - hate the grind/sexism/bro-bullshit 6. many complaints, new complaints, better than those on Richess. What about the lame "party button" that I already wrote about - lamest contest mode ever "compete for a spot to exclusive lame party - we will pick you up and drop you off to a specific location... OH, You want a ride home from said undisclosed location; FUCK YOU - stand at the corner and cal a surge uber like every other pleb, you moron" 7. No access to any recent data - but we will use it against all our drivers. 8. Here, hold my hammer in your skull for a sec.

askafriend 9y ago
Please keep this type of inane content on Reddit. It is not welcome here.
- samstave 9y ago
  please keep this inane bullshit comment to yourself... go act superior [OVER THERE]
  - 9y ago

smallgovt 9y ago

IMO, this was a clever PR move on Benchmark's part. Benchmark needs to limit any reputational damage that results from the ensuing battle. In order to do that, they need to justify their actions to the public. Engaging with journalists directly is suboptimal because it lets the journalist control the narrative which will naturally paint them in a defensive light. Addressing the public via a "letter to employees" allows them to fully control the narrative, defend their actions while not seeming defensive, and paint the picture that they are looking out for the greater good. Of course, we all know that Benchmark is self-interested. Their goals are: - Liquidate their investment ASAP via a private transaction (e.g. Softbank) or IPO - Protect the value of their investment until liquidation event occurs - Limit any reputational damage to their firm Everything they do can probably be explained by at least one of these objectives. And, it should be obvious that they don't genuinely care about Uber's employees -- only to the extent that it preserves the value of their investment (i.e. preventing substantial attrition).

mychael 9y ago
Spot On

uberemployee 9y ago

As an Uber employee, I can say this: although the feelings on TK are mixed (some loving TK, others glad that he's gone), the feelings about Benchmark are pretty uniform. They are only out for themselves, and nothing they have done have "helped" us. They have only hurt us. This current ploy they are doing is only further hurting us. Everyone thinks this "letter" is a joke. Nothing to see here, at least from an employee perspective.

BinaryIdiot 9y ago
Interesting. As far as I can tell (from the outside, of course) Travis is reneging on his deal and he's planning on reinstalling himself as CEO in addition to the extra board seats he just procured. This seems like it would hurt employees more than anything and possibly give Travis even more control over the company. To me it appears Benchmark is mostly aligned with employees; both want the company to grow and do well. So why do many have bad feelings about Benchmark's actions? What am I missing?
- smallgovt 9y ago
  Benchmark's interest lies in protecting the value of their investment and liquidating it as soon as possible. This can be very different from employees' interest in the case where Benchmark seeks to sell their stake via a private transaction (e.g. to Softbank). I'd also add that Benchmark couldn't care less if the company 'grows'. They've already made enough money to return their fund many times over. Their strategy now is mainly to mitigate risk to the paper value of their holdings.
  - BinaryIdiot 9y ago
    Fair point. I can't exactly blame them either.
deleted 9y ago
[deleted]
tschellenbach 9y ago
Founders and employees typically own common stock. Investors will have preferred stock with different rights. Depending on the deal specifics this will give VCs different incentives for the company. So yeah I can't imagine that employees are very happy about this change of control.

uhhhhhhh 9y ago

This seems conflicting: >It was at the same time that Travis agreed in writing to modify the company’s voting agreement to ensure that the board was composed of independent, diverse, and well qualified directors. Despite agreeing in writing to sign these amendments, he has still not done so. then >A number of people have asked why we took legal action before giving Travis the chance to sign these amendments. It doesn't sound like he agreed in writing yet based on their own words. Maybe that's just bad wording though. They also fail to point to any actual actions taken on his part, just references to vague statements or inferences of inaction. Not to say I'm on Travis's side of this, but from what I've read its much more likely Benchmark is trying to stabilize leadership under someone who will focus on shareholder value (not company growth/stability) as they need to divest themselves within the next year or two. This obviously stands contrary to what Travis supposedly wants (and has failed to accomplish), and probably much of the rest of the board.

toephu2 9y ago

"his continued involvement in the day-to-day running of the company" Question to Uber employees: Does Travis still come into the office everyday?

kerkeslager 9y ago

> Uber is the most important and promising company of our generation. If Uber is the best our generation has to offer, the future is doomed.

idibidiart 9y ago

The human race is facing slow but almost certain extinction (if things don't change radically) and people in tech (who can potentially do something about it) are wasting their precious bandwidth debating who's right and who's wrong. Everyone is wrong. Except for Elon Musk of course!

thinbeige 9y ago

This letter is pure Machiavellism. 'It's not Benchmark vs Travis.' BS. Basically, they try to involve the employees and bring them up against Travis. Travis should fight back, and hit Benchmark as hard as possible, so Benchmark looses all their reputation forever.

foobar8732 9y ago

I think a lot less of Benchmark reading this. 1. They are in business to make money. Not to make uber a company it's employees can be proud of. Writing a letter that's somewhere between insulting and pandering is stupid. 2. Keeping your name off the letter? Reflects their general cowardice.

abovethecrow 9y ago

Bill Gurley is a clear vulture waiting for his opportunity and worried. Travis is definitely not a gentleman known fact from his video which the driver posted. I always wonder why they got to be so nasty and squeeze the little people. I visited Uber and I felt that place was more of bar with the light settings in the lunch room. So many hastags outside the conference rooms e.g. #pumpedup.. pure sh.

wbillingsley 9y ago

In other news, I hear the SPECTRE board is also scratching its head why it's struggling to find a popular replacement for Ernst Stavro Blofeld in its CEO position. While they had a bit of difficulty around that Nine Eyes launch, the numbers in its Extortion business are growing phenominally, and investors just can't understand why up-and-coming executives wouldn't want to associate themselves with its brand and lead arguably the most important and exciting business of our generation.