New Uber CEO plans for IPO offering and aims to restore company confidence
31 August 2017
31 August 2017
The new chief executive of Uber, Dara Khosrowshahi, has set out a bold vision in his first meeting with employees, with plans for an initial public offering (IPO) within 18-36 months as it attempts to stem the company’s losses and rebuild its reputation.
Khosrowshahi was appointed on 29 August and is expected to take up the post next week. In his opening address, he made reference to getting the business into shape, which includes regaining market share lost to its US rival Lyft, while taking on the high-risk projects such as the company’s dalliance with flying cars.
The appointment marks the end of a tumultuous search project for a new CEO, following the ousting of Travis Kalanick in the role two months ago. However, Kalanick remains with the company, although his future role has not been specified. Key top posts at the company remain unfilled, with a management committee running the company since Kalanick’s departure.
Turning around the company, which had been accused of having a male-dominated culture, has been widely regarded as an unenviable task. Khosrowshahi said he initially rejected headhunters who approached him, but a conversation over drinks with Daniel Ek, Spotify’s chief executive, changed his mind. In discussions with board members during the hiring process, Mr Khosrowshahi said Kalanick had painted ″an incredible vision″ for Uber during conversations conducted over FaceTime audio, and that board member Arianna Huffington had hosted him for a Greek meal in her New York City apartment.
Discussing the company’s present struggles, he commented: ′We’re in a battle here,″‰I am going to fight for you with every bone in my body.’
While launching an IPO has been a priority for some Uber shareholders, Mr Kalanick, who co-founded the company, was opposed to the idea, commenting in 2016 that he wanted the ride-hailing group to go public ‘as late as humanly possible’.
The timing of an IPO plan is significant. The company is currently valued at $68 billion (€57.3 billion); however, this is just a cash amount until a liquidity event. While there has been some secondary market trading, Uber has very strict rules on this, which creates some limits.
While the roles of chief financial officer and chief operating officer remain vacant, Khosrowshahi plans to bring in an independent board chairman to help oversee running of the company.
The company has had a tough 2017 so far, with a number of lawsuits against it, including one from Waymo, Alphabet’s self-driving unit, over claims that it stole trade secrets about autonomous driving technology.
Photograph courtesy of iStock