Travis Kalanick cuts last ties to Uber: He sells his stock and quits the board
Uber Technologies Inc.’s former Chief Executive Travis Kalanick is stepping down from the board, severing his last ties to the company he co-founded a decade ago and helped turn into one of the world’s most valuable, and controversial, start-ups.
Kalanick, 43, has sold all of his remaining shares in the ride-hailing giant and plans to focus on his new business and philanthropic endeavors.
Along with co-founder Garrett Camp, Kalanick started Uber in 2009, building the company up from an experimental black car service in San Francisco into a global transportation and logistics company that offered food delivery, freight shipping and helicopter rides and ushered in a new era of work.
But he was ousted as chief executive in June 2017 following months of chaos and controversy. Detractors pointed to his aggressive and sometimes reckless management style as breeding a toxic workplace hostile to women and overseeing morally questionable company programs, including some that intentionally deceived regulators and law enforcement agencies and spied on riders.
“Uber has been a part of my life for the past 10 years,” Kalanick said in a statement Tuesday. “At the close of the decade, and with the company now public, it seems like the right moment for me to focus on my current business and philanthropic pursuits.”
For the last year, Kalanick has been building a new start-up: CloudKitchens. The real estate company offers fully outfitted kitchens to restaurants that need more space to fulfill orders from take-out food services such as DoorDash and UberEats. Along with using his own funds, Kalanick also raised $400 million from Saudi Arabia’s sovereign wealth fund.
Following Kalanick’s departure as Uber CEO, the board replaced him with Dara Khosrowshahi, a former Expedia Inc. chief who has worked to rebuild Uber’s reputation and promise to investors. Since its initial public offering in May — one of the worst IPOs this year — Uber shares have dived more than 30%. They rose 0.4% on Tuesday.
Kalanick’s full separation from Uber could help the stock, Wedbush Securities analysts said, since his continued presence on the board was a “distraction.”
“With ripping the Band-Aid off and Travis leaving ... we believe now it’s about Dara & Co. taking Uber in the right direction for 2020 and beyond after a rough road so far,” wrote Wedbush analysts Ygal Arounian and Dan Ives, adding that the massive sell-off of shares following the Nov. 6 lockup expiration has also hurt the stock price.
Kalanick had steadily unloaded his Uber shares in the last few weeks. He sold his last 5.8 million shares before resigning from the board Monday night, a spokeswoman said — bringing his haul to almost $3 billion, according to calculations by Bloomberg. Before the lockup expired, Kalanick held a 6% stake in Uber, which made him the firm’s largest individual shareholder. Softbank Group Corp. and Benchmark Capital are the company’s two largest institutional shareholders.
Such a selldown is unusual among prominent tech tycoons. Facebook Inc.’s Mark Zuckerberg and Amazon.com Inc.’s Jeff Bezos still own sizable stakes in their companies. Still, neither of them was ousted by a boardroom coup.
And Kalanick’s sales mean he has plenty of financial firepower for his other projects. He created a fund called 10100 in March 2018, saying in a tweet that it would focus on his “passions, investments, ideas and big bets.” The fund will handle Kalanick’s for-profit investments and philanthropy and plans to invest in real estate, e-commerce and emerging innovation in China and India, according to its website.
“Very few entrepreneurs have built something as profound as Travis Kalanick did with Uber,” Khosrowshahi said. “I’m enormously grateful for Travis’ vision and tenacity while building Uber, and for his expertise as a board member. Everyone at Uber wishes him all the best.”
Kalanick’s departure from Uber’s board will be effective Dec. 31, according to a statement Tuesday. Uber’s 12-person board has steadily shrunk since the company went public in May and now will have four openings.
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