I read Super Pumped by Mike Isaac on Oct 10th, 2022

Despite its meteoric rise, Uber had always lingered with disgraces and scandals.

This book, Super Pumped shed more lights on the crannies behind the spotlights:

Uphill battle

Controversy aside, I am still amazed that Uber managed to survive this uphill battle, and might win if the gig economy is financially sound. Uber tried to build a marketplace to matchmake riders and drivers to avoid heavy operations and investments, but it MUST grow both the buyer and seller sides with massive incentives. By 2015, Uber was globally spending more than $2 billion annually incentivizing drivers and riders.

In the winner-takes-all mindset, Uber needs “blitzscaling”, a term coined by Reid Hoffman, to dominate the global transportation markets. Kalanick granted regional general managers autonomy for campaigns, and promotions. It is no wonder that corruption, bribery, nepotism, and backstabbing emerged from the cut-throat competition for bigger slices of the piggy bank.

But it worked, at least in the United State. Uber almost crushed Lyft, 72% vs 28% market share according to Bloomberg. This strategy was outmaneuvered by other deep-pocket players, such as Didi in China, Grab, Gojak in Southeast Asia.

One of DiDi’s preferred tactics was to send new recruits over to Uber to join as engineers. As soon as they were hired they acted as moles, feeding proprietary Uber information back to DiDi and carrying out corporate sabotage on some of Uber’s internal systems.

Uber poured $40 million to $50 million incentives to China market, and eventually threw the towel for fear of the “king-making” government policy in favor of Didi.

Pipe dream of self-driving

In Kalanick’s vision, Uber would become the central stage for moving things from point A to point B. The major cost is associated with drivers, — they need to be paid, insured, recruited and retained. In 2015, Uber opened Advanced Technology Group(ATG) center in Pittsburgh, and raided Carnegie Mellon University’s National Robotics Engineering Center for talents.

Google’s affection on the self-driving went back on 2009, the Project Chauffeur, led by Sebastian Thrun, and legendary Anthony Levandowski. Levandowski was a prodigy engineer, but disdained the authority and rules. In 2011, he hired a lobbyist to push Nevada state’s legislation to pass a law to allow testing self-driving vehicles without leadership’s approval. In January 2016, Levandowski left Google to launch Otto because “was eager to commercialize a self-driving vehicle as quickly as possible”. Otto was acquired by Uber on July 2016, and morphed to Uber Freight later.

In February 2017, Waymo sued Uber for trade theft, which kicked off the saga of legal battles between three.

Coup d’état

2017 was a tough year for Travis Kalanick, not only a string of scandal tarnished his reputation, his mother passed away, resulted from a boating accident. Kalanick took a leave of absence to mourn his mother on June 13, when the internal investigation led by former U.S. Attorney General Eric Holder was presented to the all-hands employee meeting.

The investors, led by Bill Gurley, the investor from Benchmark took the opportunity to weather a coup. The investors, collectively controlled 40% of voting shares force Kalanick to sign the immediate resignation letter on June 21, 2017.

Closing Thoughts

After a decade, Uber has still been struggling with profitability, so are its rivals. Is possible that the business model just does not work? The market is so inflated by VC’s money that the low-cost rides are simply non-sustainable? That might explain why the platform is bleeding, and the drivers barely make minimum wage with all costs taken into account.

Will Uber can continue grow its 37% global market shares and eventually has the monopoly to hike the price some day; or the autonomous driving renders the peer-to-peer gig economy obsolete?

Only time can tell.