Uber CEO Travis Kalanick resigns. Now what?
NEW YORK (CNNMoney) — After six months of scandals and PR crises, Uber CEO Travis Kalanick resigned late Tuesday.
Now comes the hard part.
Uber must find a new top exec who can help mend its battered internal culture, improve its public image, steer it through legal battles and shrink its steep financial losses if it ever wants to go public.
To make matters worse: Uber faces a depleted C-Suite. It currently has no COO, CFO, CMO or president. A number of other top execs, including its SVP of business, have also recently left or been pushed out.
“This is a hugely troubling situation and uniquely problematic with layers upon layers of problems,” says Jeffrey Sonnenfeld, a professor at the Yale School of Management. “There are leadership vacuums in every key function.”
Uber has been run by a committee of executives since Kalanick agreed to go on an indefinite leave of absence last week. The leave was intended for him to grieve for his mother and work on becoming a better leader.
Uber has also been searching for a COO for months to help Kalanick. Reps for Uber did not immediately respond to a request for comment on updates to this plan.
Even though Kalanick is no longer CEO, he will likely continue to have a strong influence on the startup he cofounded.
He will continue to serve on Uber’s board, according to a statement Uber’s board provided to CNN Tech. Kalanick and his allies, including cofounder Garrett Camp and early Uber employee Ryan Graves, are said to dominate the board’s super voting seats.
Kalanick has been synonymous with Uber since its early days. He built Uber into a household name valued at $68 billion through a mix of aggressive fundraising, dodging regulators and undermining competitors.
But that aggressive — some might say reckless — approach may have paved the way for Uber’s recent controversies. Under Kalanick’s leadership, Uber has come under fire for sexual harassment, building a tool to flout regulators and its handling of a rape victim’s medical records.
Among Uber insiders, however, there’s an ongoing debate about whether the company can continue to outpace the competition if the brash Kalanick is replaced by an executive with a softer touch.
As one former employee said, “You put in someone who’s more benign or more PC or more timid, and you really think Uber will make it to their valuation or IPO?”
Bradley Tusk, a political consultant and investor in Uber, says the company needs a leader who can “balance” being “extremely innovative and aggressive” with of “a sense of responsibility and accountability.”
“If the board just plays it safe, they may win the battle (a few good press cycles), but they’ll lose the war (a truly great, innovative company),” Tusk says.
Others say Uber is a big enough company now that it needs a different leadership style.
“Now that Uber is at scale, I think a different type of leadership can work well and that tenacity is less important at this phase of the company,” says Mike Walsh, an early Uber investor.
Garrett Camp, Uber’s cofounder and chairman, hinted at a more mature approach in a blog post published just hours before Kalanick’s resignation was announced.
“A friend recently asked me, ‘What went wrong?’ and the answer is that we had not listened well enough to those who got us here… our team and especially our drivers,” Camp wrote in the post.
“In a highly competitive market, it is easy to become obsessed with growth, instead of taking the time to ensure you’re on the right path,” he added. “Now is that time.”
If the history of Silicon Valley is any indication, though, there’s still a chance that Kalanick will one day makes his triumphant return to the CEO role. The founder CEOs of Apple, Google, Twitter and others all stepped down or were pushed out only to return.
With enough time out of the spotlight, Kalanick may just be able to claim he’s achieved what he and his allies have long promised: Travis 2.0.
— Sara Ashley O’Brien contributed to this report.