Guest Post: The Ugly Side of Uber


The following is a guest post from Steven S. Hoffman, CEO of Founders Space and author of Make Elephants Fly: The Process of Radical Innovation

We’ve all heard that Benchmark, one of Silicon Valley’s top VCs and largest Uber shareholders, is suing Uber’s founding CEO, Travis Kalanick. Benchmark believes Kalanick is packing Uber’s board with loyal allies, so he can return to power, and it has accused him of fraud, breach of contract and breach of fiduciary duty.

This is a disaster for Uber, as if Uber hasn’t suffered enough Kalanick-induced calamities. No investor wants to sue its founding CEO. The fact that Benchmark is pressing this lawsuit means things are bad. Really bad. And it’s serious about getting rid of Kalanick.

The problem is that Kalanick is a street brawler. He built Uber into a giant by fighting his way past every obstacle. He plays dirty when necessary. It’s the same trait that allowed him to crush his competitors, but it’s also what has been his undoing.


Kalanick’s questionable tactics have enabled him to come out on top. He doesn’t mind bending the rules, or even rewriting them entirely. That’s his style of doing business, and it works at times, but it has also planted the seeds of his own destruction. He crossed the line, and now he’s paying the price.

Unfortunately for Benchmark, Kalanick is not the type to give up or back down. So it’s going to be a bitter battle that will undermine the foundations of an already reeling company. It’s a lose-lose proposition. The company needs strong, new leadership right now in its moment of crisis. It doesn’t need infighting and turmoil. By refusing to leave gracefully, Kalanick will do more harm than good.

Benchmark would never have filed a lawsuit unless it felt it had a strong case and needed to get rid of Kalanick permanently. The fact that this lawsuit exists at all is a sign of how rotten things have become at Uber. In the end, the shareholders and employees will lose if the fight continues for too long. The company will be rudderless, and employees are already jumping ship.

Honestly, I don’t see a quick resolution. I don’t see Kalanick backing down. But you never know. Life is full of surprises, especially where Uber is concerned!