Kapor Capital has a strong focus on social impact companies that benefit the disadvantaged.
Travis is a phenomenal salesman and fundraiser. Travis convinced Kapor that, amongst other things, Uber was a platform for democratizing transportation, citing things like racism amongst taxi cabs to spin Uber as social good.
So now you have a company that isn't actually what it pitched itself to be. For many investors, hyper-growth and skyrocketing valuation will wipe out other concerns around culture, impact, etc.
The Kapors are showing (awesomely, in my personal opinion) that they are serious about their social mission. They're doing what they can to influence a portfolio company to live up to their expectations. Travis probably doesn't like that—it sucks to be called out!—but that's why you take investment based on aligned interests and not just awesome salesmanship.
But that's not true. Uber is still a platform for democratizing transportation. It has more or less completely fixed the issue of racism in taxi cabs (or auto rickshaws), which was previously a daily experience for me. In Maharashtra they've literally made an enemy of Shiv Sena, racist/nationalist political party, because they are undercutting the Marathi autowales.
It's also improving women's safety worldwide, which is a major issue outside the west. Literally days after an Uber driver raped a passenger in Delhi, my girlfriend at the time still insisted on taking a radio taxi home (wasn't Uber, which was shut down for a little bit) because she felt safer than in an auto rickshaw or taxi.
Uber is working - fairly successfully - to partially fix the issue of cronyism in governments around the world. They've taken private battles public and shown the world exactly how much people like Bill DeBlasio hurt the public.
This would all be a huge net gain for the world even if every >$150k/year engineer at Uber was horribly mistreated/marginalized/had their butt patted before shifting to another $150k/year engineering job.
The Kapors are not calling out Uber based on a utilitarian calculation. Uber is still exactly the force of good they promised to be, and their goals align just fine with the stated goals of the Kapors. It's just that their personality doesn't appeal to the zeitgeist, and it looks like that matters more to the Kapors than the actual good they do.
When I first moved to New York, I had a roommate. He was Brown educated, on prominent City boards and sharply dressed. Regularly, I'd have to climb out of bed and walk to our corner of 30th Street and 5th Avenue, a decent neighbourhood, to hail him a cab.
The reason? He's black.
I got used to quibbling with cab drivers over "broken" credit-card machines (magically resurrected when I threatened to call the TLC, their regulator). And dealing with my out-of-borough destinations being inconvenient. Or having drivers on their phones the whole way.
Yellow Taxis have gotten measurably better since Uber entered the scene. Credit owed where it's due.
Passengers should never cancel accepted trips. That's what I explain to my passengers when they complain about other drivers doing this.
I never cancel my trips if the passenger is ready to go (some are too drunk or otherwise unable). Drivers who cherry pick can still be reported, but that's a manual process.
The leading cause for driver deactivation is excessive cancel rate. For that reason, the passenger should insist that driver cancel the trip.
I run into this when I call the passenger to confirm that they indeed wanted to order Plus service and that they are willing to wait 15-20 minutes for me to get there. They often think I am calling to cancel, but I never ask the destination since that's at least unethical and possibly illegal.
Maybe I don't understand what makes a good fare.
Also incentives are based on trip count, not trip length as far as I understand.
It's a problem that needs to be fixed in big cities with these apps.
But the reason why they reject in these cases has nothing really to do with the person, but the action/destination. Definitely an improvement.
The one time I took Uber Pool in Brooklyn the driver refused to let a black couple into the car, which we all protested and complained about, but nothing came of it.
In New York Uber isn't necessarily safer or less racist, although I'd concede it probably is in other countries.
For what it's worth, my girlfriend has taken an uber in NYC 100+ times, and has never complained about any kind of harassment from an Uber driver. She's complained to me about sidewalk/subway harassment, and workplace harassment, so I don't think there is a reason she would hide Uber harassment from me.
Also: Regular car services were horrible pre-Uber...which is why Uber took over NYC car transit.
It was basically: Call up a number, get answered by a guy with a heavy accent on a low quality landline, tell him what you want, and hope and pray that he understood what you said and the car shows up. If it doesn't, call another company and repeat.
Just curious to what extent you protested?
I mean, they can start out driving for both, but if you get fired by Lyft, you can't ever come back in most cases.
Lyft requires newer cars, which could bar totally broke drivers.
I have perfect background check, of course.
Lyft is definitely hands-on when reacting to passenger complaints. They likely have sentiment analysis software for comments by passengers.
Lyft passengers are ruthless in ratings. It took me a while to recover from initial ratings while I was learning. At least your ratings are a rolling average of last 100 rides so you can fix the problem of bad ratings with new rides. Last week should help: got 17 5-Star ratings and no negatives.
1) They have more direct control over, and responsibility for, Uber corporate behavior.
2) Uber corporate culture might bleed over to the customer experience.
3) The behaviors in practice at Uber are not good for anyone, even the "high-performing" assholes whose behavior is excused. Those behaviors keep talented prospective employees away and make current employees less effective.
I was only disputing the specific point I quoted. Even if everything Susan Fowler said is true, Uber is still a social good that is fixing racism in taxi cabs.
Harassment is harassment.
That part wasn't an excuse for harassment. And it also wasn't about programmers' salaries as justification. He was using rhetorical hyperbole to emphasize that the utilitarian benefit of Uber for brown and female riders is still true. That was a response to tyre's comment, "So now you have a company that isn't actually what it pitched itself to be.
Yes, harassment is harassment but it looks like yummyfajitas was responding to a specific business claim by tyre.
Part (but not all!) of the reason for this is that not every $150K/engineer is getting harassed, only some are, and some are doing the harassing, and in particular, those who are doing the harassing are, by all reports, not actually helping Uber's social mission effectively. If you're willing to sacrifice something about engineers to help Uber change the world for the better, sacrifice the people who take time out of their workday to proposition the people they manage, or who ignore their boss because they're trying to get themselves promoted, or who create and cancel projects to create the illusion of work, or who interpret people who sabotage their teammates as high performers. (And sacrifice them by firing them or better yet not hiring them, not by harassing them.)
I don't give a fuck how much that woman was getting paid, it is not conditional on her receiving sexual harassment from her supervisors. It is conditional on her doing her goddamn job, and making people feel unsafe by directly propositioning them obviously interferes with that.
As a society, we've made the decision that traffic regulation, gun regulation or preventing the sale of loose cigarettes does justify the police gunning people down or choking them to death. (Note that after Eric Garner and Philando Castille, no one advocated eliminating the rules that got them killed.)
So why is an unpleasant work environment somehow one of those things that are unjustified no matter what?
"So why is a hostile work environment somehow one of those things that are unjustified no matter what?"
Furthermore, the type of people that want to invest in companies that decrease systemic racism and harassment experienced by their riders should also be concerned about similar problems at places closer to home. Framing these abuses as though they are not all different manifestations of failing to recognize other people's humanity on some level really undermines any progress.
Specifically, if you think (1) "There are things in the world that are really bad, and no amount of greater good justifies them. Harassment is one of them." but you also favor cigarette regulation, then you must implicitly think the inevitable shooting/strangling people/other violence is NOT one of those things that are "really bad and no amount of greater good justifies them".
Or alternatively, the stated principle (1) is not your real justification and merely a post-hoc rationalization.
I suspected the latter. But I was wrong - as it turns out geofft is internally consistent and also opposes cigarette regulation, firearm regulation, and all the other rules who's enforcement involves doing things that are "really bad and no amount of greater good justifies them". https://news.ycombinator.com/item?id=13725372
Regardless, this is whatabouttery. It's true that we have much more serious problems in the world than workplace harassment, like poverty and slavery and famine. That doesn't mean that the less serious problems aren't still problems.
There's also the minor matter of breaking federal law. You can call this "the zeitgeist" if you like, but if I was an Uber investor I would be concerned that the company is leaving itself wide open to multiple class action lawsuits. The amount of their funding used to fight the many suits against them is also more generally concerning. Lyft doesn't seem to get into the same battles they do, so clearly it's possible to achieve good without being raging assholes while doing it.
When is the last time Lyft prevented someone like DeBlasio from helping the taxi cartel rip off consumers?
Really? The only problem you see at Uber is that their personality doesn't appeal to the zeitgeist? They are unpopular for superficial reasons and that's it?
Are you saying that it's okay to be harassed if the pay is high?
If so, please examine your own mind for its blind spots and learn a bit of humility, before sounding high strung and judgemental about others'.
150 years ago, which is only a handful of generations, it was widely accepted in America that people of certain races were only technically human and were better fit for slavery than for living a full human life. That position is an extreme minority these days. What changed? Nobody eloquently argued that idea away, we merely made the culture that relied on that idea economically unviable (at gunpoint). We didn't even do a very good job of making alternative ideas more economically viable, and that hurt us deeply for the majority of that time.
If we move racist employees from company X to failing company Y, we make a non-racist culture more economically viable. People who are only weakly racist generally choose to give up on spreading their ideas (even if they still hold them) to choosing an economically worse option. People who are undecided are more likely to hear about or be part of the non-racist culture than the racist one. That is, historically, how we have been fixing racism. It hasn't been working perfectly by any means, but it's been remarkably effective.
Capitalism is actually a great racism cure. Racism was always economically unviable.
It only existed because we passed laws protecting it. For example, greedy contractors hired negroes to build stuff until congress passed the Davis-Bacon law stopping that. Jim Crow wasn't a set of "you can discriminate if you want" laws, it was "you must discriminate". It was an extremely intrusive regulatory regime to the point of regulating dating choices.
Uber doesn't care about my race. All they care about are my dollars/rupees.
Well, sort of. What's good for the economy as a whole isn't always the same as what's good for you individually. I might prefer a world in which I know my kids have good jobs, but technology remains stagnant for a generation, to one in which technology improves and the economy as a whole grows, but my kids have much less reliable jobs. (This is essentially Pigou's argument about negative externalities; capitalism is, in theory, a great environmental cure, because you can't make money without a world to make money in, but that doesn't seem to be stopping any capitalists at the moment.) Or the effects of making the economically-rational decision might be so slow and so hard to detect that an actual human will fall back on their biases and never miss the profit they could have gained by not trusting their biases. (This is Greenspan's famous argument about hiring women economists.)
There's a timely and (at least for most people) non-racist example here: immigrants on work visas. Economically, it's good for my country to hire the best possible workers at the lowest possible salary, regardless of country of origin. So why do we have borders and ensure jobs go to equally-good workers at higher salaries (or worse workers at the same salary, or both)? Because we like a world in which the employment of our countries citizens' is protected, even at the cost of our economy.
Slavery was extremely economically viable. And the fact that you need laws to make slavery illegal, but you don't need so many laws as to make Jim Crow mandatory, leaves me skeptical of the use of unguided capitalism as an effective tool for ending racism (even if in theory it would work).
This may be true, but it's completely unrelated to the point I made.
Slavery is only economically viable if you don't treat the slaves as economic agents. At the time when slavery was being debated, virtually no one actually made this argument because it was patently ridiculous.
In fact, the phrase "the dismal science" was coined by a slavery supporter to criticize the economists who opposed slavery. Slavery proponents were actually anti-capitalists who argued that slavery was better for slave and master alike - they favored hierarchical relations rather than exchanges based on mutual agreement. I know Moldbug has been shunned from society for advocating it, but you should read Carlyle if you want to understand history.
It's true that if you don't treat foreigners as economic agents, then economics does in fact suggest treating them as an exploitable resource as well. In fact, if you take that premise, we should probably enslave them rather than just pass protectionist laws against them.
One of the things that's usually attractive about capitalism is that it is, in a sense, the default. Absent a government saying otherwise, two individuals or businesses or even countries will tend towards capitalism in their relations. But absent a government saying otherwise, slavery also arises, in many places and times in history.
What changed to make people say "Hey, we're failing to treat slaves as economic agents"? It may be the case that on paper, slavery was not economically viable ever - but it was absolutely profitable and desirable in practice. (That may be the disconnect; I'm using "economically viable" in a practical sense.)
The question of who is an economic agent is exogenous to capitalism.
What changed to make people say "Hey, we're failing to treat slaves as economic agents"?
In the US, a bunch of religious crazies decided to force their biblical interpretations on everyone else. For a while they used politics and small scale warfare (e.g. running around ad night and chopping people's heads off) to push their morals on everyone else, on slavery and other issues like drinking and polygamy. Eventually the limited wars erupted into a total war for dominance, which they won.
I'm less familiar with European history so I won't speak about that.
In the way capitalism arose from pillage & plunder.
Even way before the Industrial Revolution.
The navies protected the (taxable) commerce from further pillage & plunder.
But the only ones that could afford to build any ships at all were usually the monarchs whom had already largely pillaged and plundered the wealth of their subjects.
Capitalism at this complete a level of wealth concentration reveals its eventual destructive effect on free enterprise.
Due to the extreme wealth inequality ships could justify cargoes of volunteers who would virtually pay to live as somewhat of a slave somewhere else.
Eventually it was only a matter of greed whether a particular voyage would contribute to a more advantageous outcome when choosing either physical or financial bondage for their cargoes of slaves.
When the viewpoint of the capital owners is so far removed from that of the lowest-level subjects, the difficulty for them to respect the (finer?) differences between physical vs. financial bondage of their servants in the 18th & 19th centuries evolves into the blurring of the distinction between financial bondage vs. financial empowerment of their employees in the 20th & 21st centuries.
Simply depending on where the powerful draw the line when greed is involved.
When the money must make money even under adverse conditions, the result of unbridled capitalism tends toward slavery of some form or another.
Depending on your point of view, I guess.
That said, one can meet that standard, and provide a better/cheaper transportation service and everything else in Uber's mission without standing for a toxic workplace environment for women, no matter how much they are or aren't paid. There is exactly one profession where the amount of money you are being paid justifies tolerating unwanted sexual overtures and is not the profession software developers are signing up for.
Does the ends justify the means here? Not really. Lyft is arguably similar to Uber but without so many alleged and evidenced wrongs. We can quibble about how similar they are, if Lyft would be successful without Uber, how successful Lyft is, etc. but the fact remains that a sizable competitor in this space doesn't have as many faults and seems to be doing just fine for a startup.
Does the ends justify the means ever? Perhaps. But it is often an argument made in hindsight to diminish real wrongs for the sake of theoretical utility, when in reality there are many levels of gray that have fewer wrongs and similar theoretical utility.
Travis convinced Kapor that, amongst other things, Uber was a platform for democratizing transportation, citing things like racism amongst taxi cabs to spin Uber as social good. So now you have a company that isn't actually what it pitched itself to be.
I did not make any "ends justify the means" arguments, or claim that what happened (if Fowler is to be believed) is acceptable.
Vast majority of the cab drivers are from the Northern states. The natives of Mumbai dont want to drive cabs.
I'm very sure they don't get the destination when choosing whether to accept the ride, and often don't seem to get it until you get in the car?
I think you are the one with "broken logic circuits."
Uber will have increasing difficulty attracting and retaining talent now that their toxic culture is public. When you're a rocket ship people are willing to gloss over a lot, but Uber no longer has 100x potential returns on options. The liability only gets worse as the stock matures.
Not to mention the wave of lawsuits that is likely coming as Uber employees are emboldened.
So we're starting to suffer from a "boy who cried wolf" syndrome, where when the complain is real, no one cares.
That's a big problem.
Er, have you? Fowler's post said she was sexually propositioned over Slack, by her manager, on her first day, and that HR did not do anything about it, even though multiple women had complained about the same manager doing the same thing. That's the most egregious story of harassment I've ever heard of, including the made-up scenarios in the "workplace sensitivity" training I had to take last week.
We are all reasonable people here and can agree that this behavior, if true, is disgusting and unacceptable. But is a "claim" evidence and should we assume it is by default "truth"? This is the crux of the issue.
If you stood accused of sexual harassment I'm sure you would hope society would take a moment to gather the facts before judging you, even if on an individual level you weren't a likeable person. Because being likeable and condoning sexual harassment are two different things.
Of course not. The comment I was replying to was saying (paraphrased) that this is typical, every company has these kinds of accusations, and I'm disagreeing and saying no, this isn't typical, either she made all this up out of whole cloth or Uber is an especially bad outlier.
> But is a "claim" evidence and should we assume it is by default "truth"? This is the crux of the issue.
That is emphatically not the issue, no one in this thread suggested that she should be believed (or disbelieved) uncritically. This stuff is murky enough to discuss without strawmen!
I was talking about "people make serious complains and get rebukked". Now, whilere there's quite a wide range of what a "serious complain" is, people say that everywhere.
Not all complains are equal. I'm not pretending they are.
She said what needed to be said. If Uber challenges her account, she can post more information, assuming she is telling the truth (which I am for now).
I am curious about your question. I read Fowler's post, and then subsequent posts,articles,tweets,comments by other women and men indicating that the observations approximately matched their experience at Uber as well. Even in this thread, I see: "I've been with uber for nearly 2 yrs and most of the article content are valid. Employees voicing out genuine concerns will be met with severe rebuke. " . The article this thread is about is from Mitch&Freda Kapoor who are also stating the same.
I'm wondering, do you believe that Fowler's claims are faulty or false in some way and that the issues raised about Uber are similarly faulty/false or are you speaking about other cases/companies?
A friend has worked on sexual harassment suits and says it's unfortunate that, as far as he's experienced, every single one he's been involved in has been bogus. Meanwhile, he knows there are several people with good cases who don't bring them, because the social penalties are too high.
Part of the reason I believe her is that she isn't bringing suit. She's not trying to make a payday out of this. Further, she has alleged specific acts which can be definitely proven or disproven. If she made it up, it would be trivial for Uber to show she did so.
It seems like you're somewhat sympathizing with Uber HR's decisions regarding this individual on account of the "boy cried wolf" syndrome.
This seems like hardly that at all. The events at Uber read like a systemic failure to deal with problems, and an extreme indifference to sexual harassment for the benefit of retaining "good" engineers.
Fuck this mentality.
edit: Forgive me if I am misunderstanding your comments.
But I have not seen the endemic spiteful complaints he has. My impression is this place is full of wolves that are seldom called out.
I was not even talking about the Uber case at all.
I'm saying how everyone who works at every company says they make complains about everything and never get heard. That makes it hard to figure out which companies are ACTUALLY bad at dealing with complains BEFORE something like the Uber bullshit actually happens. It prevents us from being proactive.
I did not mean that I see sexual harassment claims like this one everywhere.
When I said "Ive seen this type of complain", I was talking about the person I was replying to. Employees who say the company never do anything when they bitch about stuff. Employees bitch a lot, so its hard to tell apart companies like what Uber seems to be, from companies with a lot of whiny employees, without actually working there.
Short of the Apple and Googles of the world, or the little koolaid trendy startups, all companies have a percentage of fussy employees who will say their employers screwed them over, so we have to take what people say with a grain of salt. Because we have to take so much with a grain of salt, we can't proactively find real offenders (as easily).
Wow, I have never encountered that kind of thing (admittedly I've only worked at 3 companies)
I'm not saying that all companies are bad at dealing with complains.
I'm saying that for every company with a non-trivial amount of employees, there will be a bunch of said employees complaining that they made big complains that were ignored. "Management never listens to my brilliant ideas!" "We're all underpaid!" "People cry under their desk every day!" "The CEO doesn't understand my brilliant idea I figured out in 30 seconds!"
There's always people like that everywhere, and it makes it very hard to distinguish companies that actually take their employees seriously from companies like Uber without actually working there.
That's all I meant.
But. From experience I can tell you that it is absolutely not trivial for a company to simply claim a given allegation is false. Even if the company is correct and truthful about it. With a tiny kernel of truth to otherwise false allegations, enough bias will give clear answers and the public verdict becomes all the more damning.
So as much as it may be appropriate to damn uber in this case, please don't do so simpy because they didn't go for "a good offense is the best defense" here.
(The sad part is I agree Uber has a problem and needs to change; Susan Fowler's blog post was remarkable.)
I'm sick of how Silicon Valley always puts money and internal graft ahead of inconvenient things like morals and acting like decent human beings. Beyond that, I'm tired of how everyone then tries to pretend that these actions that are taken out of greed and ambition to "rule the world" are somehow in the public's best interest.
I see no reason why you are reprimanding a pair of human beings who realized that the company that they have aided, abetted, and implicitly condoned through their investment, and then decided to do what little they could to try to influence that company to fix the situation.
And if it's not (and not willing to self police to a higher ethical standard), then we should really start asking whether we're comfortable with these companies having the amount of access to our lives they do.
Would you trust Walmart with an Echo type device in your house?
Offtopic, but that's an odd example. I wouldn't trust WalMart to be fair to their employees, suppliers, etc. But, they aren't the company that comes to mind when I think "who would I least want to potentially listen in on me whenever they wanted?" The company I do worry about in that space does happen to sell an Echo type device...and it's not Amazon.
If you dig down a bit, you'll find that it's not much.
There's nothing at all special about Silicon Valley companies with respect to ethics.
For another example, if Comcast compiles user data, it's scummy. If Google does it, we might gripe about it a bit, but it's business as usual.
The root cause for the founder sentiment in this thread is empathy.
The firestorm Uber is facing may be self-inflicted and justified, but the management team there is made up of real people that are in all likelihood good at heart.
When you have an ongoing PR crisis, a letter like this makes things impossibly difficult. And, the fact that it's written by someone who's supposed to be a trusted team member is an arrow through the heart.
Bounds-checking errors and the like do happen, and in rare cases reach catastrophic proportions, as we saw today. Downplaying what happened in that kind of situation isn't quite right, but it's still victimless in a certain sense -- you're minimizing the PR damage to yourself while not exactly hurting any other party. But Uber's behaviour here is essentially an attempt to apply the kind of "mitigation" that a situation report for a security vulnerability documents to a human conflict. (Non-serious aside: do they have an in-house "Fowler incident report" being edited every ten minutes?) It'd be far more admirable if they could go the completely Homo economicus route and declare "We don't honestly care, as long as we're profitable, and we're going to do everything possible to combat this eventuality." or something along those lines that actually reflects what they think of this, but obviously that would be ... suboptimal.
Yes, Uber management may be (in fact, from the emails they're sending out to people "deleting Uber", they definitely are) suffering as a result, but the lack of a contrite "Yes, this happened, it shouldn't have" instead of the "This is contrary to our values, our ethos, and a few other words that conjure associations of fine, upstanding citizenship in our communities and such" (read "Lies!"), together with the obviously impartial steps they're taking to "investigate" the matter, make it difficult to find empathy for their pain here.
(Any strawmen or logically suspect arguments in the above are unintentional and I'd love being told about them. Damn, I'd use that for an HN signature if those were supported.)
I absolutely wish this "stress" on them, because they deserve it for letting their company get to this state. And people who are good at heart don't let their company's culture get like that.
This kind of comment is too harsh and over-simplifies the kind of decisions that growth-phase startups have to face. You have many battles to fight, and sometimes you have to make a trade-off. In Uber's case, they prioritized hiring and firing people to manage performance over dealing with culture issues. Not saying the trade-off they make is right - I think they all realize now they cannot treat themselves as a startup any more - but claiming the management at the company are not good at heart is just totally unjustified. Do you also think startups that lay off people when they don't need them or move operations to cheap regions to also have bad heart?
Those are always rather cold-hearted actions. Employees are not a disposable quantity that you can dump at Goodwill like surplus furniture; companies should make sincere efforts to avoid layoffs.
EVERY manager over at Uber has to own this. They are the ones at fault. And right now, they need to prove they are good hearted. That is not an assumption to make by default.
So are the harassment victims and underappreciated employees. Spread your empathy around.
"Good at heart" is kind of meaningless anyway. Judge people by their actions, and their sincerity by how they respond to criticism and mistakes. It's a character test and they're failing it.
Your relationship with your investors and your board is both public and private (or at least, it's supposed to be). Yes, you are owed a private space to discuss difficult internal matters. But your investors are also responsible for getting you ready to be a public company, and that means holding you accountable when you've fallen below the threshold of what would be acceptable to public shareholders. As the letter notes, "accountable" by definition means in the open and out of your total control.
Mitch and Freada are doing Uber's shareholders a service (and therefore also doing Travis a service) by helping the company clean house before they're exposed to the harsher sunlight of being a public company. If you wouldn't have them as investors as a result, then you're not ready to be held accountable by others and aren't public CEO material.
As they say, GIGO. Feel free to take on garbage investors, but don't be surprised if your probability of success goes down as a result.
Can you name something they've done that has had a more positive effect on the world than Uber has?
He's invested in UUNET (!), Real Networks, Asana, AngelList, Dropcam, Omada Health, Optimizely, Twilio, and many more startups.
He was the founding chair of the Mozilla Foundation.
And much more. He is a lion of industry, having made his mark across multiple generations. Uber is important, but it's one company whose wins are not yet even solidified. Travis isn't even close to being in the same league yet.
Doubly so if the fixes Uber made to city governments were also to vanish.
I can't tell how much of this was because Uber decided to find someone themselves, vs. relying on Kapor's Project Include.
There is a difference between "held accountable" (which would be shareholder/board actions) and "throwing bricks through the window" (which is this).
For example, parents can justifiably kick one of their kids out of their house if that kid is dealing drugs from the parent's house or something similarly extreme.
Thats the kind of situation investors are looking at with Uber. From the "benign" lawbreaking we consider disruption they've moved on to attempts to silence and intimidate journalists, and now a self destructive culture where the strong are preying on the vulnerable inside the company.
That can completely destroy an investment!
If you're known to be a silent investor in Uber, how long until your deal flow starts getting interrupted because companies refuse to work with you? Maybe never, but I personally applaud these investors for finally speaking up.
I'm not perfect. I make mistakes. If I were a founder and I made a mistake running my company, I would want my investors to tell me. I would want them to tell me privately, so I could do something about it without creating a huge public scandal. And I would listen to what they said -- I might, after careful consideration, disagree, but I would absolutely listen and take it to heart.
Now, suppose I were not the founder, but some other member of management in a company, and the company was making a mistake. I would want the investors and board members to talk to the CEO (and other people, perhaps even me, depending on my role). I would want the CEO to listen (just as I would). But if the CEO were NOT listening, if the CEO were part of the problem... well, then I would want the investors and board members to use other channels (even public letters if that's what it took) to rescue the company before it was destroyed.
Errr, they literally describe this as the case?
(IE they tried all of the channels you suggest first)
Yes, that's why mcherm is saying that he agrees with the open letter having been written and published.
Right now, they're probably walking a fine line between doing the right thing and maintaining some sort of ROI. I didn't know about the Kapors until today, but considering Mitch's background as an EFF cofounder, the companies Kapor Capital has invested in, and their two other articles on Medium posted a year ago, their actions show they care about more than just profits.
If all the Kapors' effort happens to be for "burnishing SJW credentials" then so be it, at least they're making a difference in the real world.
Do you agree at least in theory that there is some amount of time of attempting to influence a company in private without success after which it is appropriate to go public? If not why not, and if so why are you so certain that that time requirement has not been met yet in this case?
As a thought experiment, what if Travis Kalanick personally committed a serious violent crime, and Uber the company was covering it up? I think you would agree that it would be ethical and commendable in that hypothetical case for Mitch Kapor to go public like this with his criticism.
So if you accept that, then really it's just a measure of what offense is bad enough that it's ethical for an investor to criticize an investment like this. Maybe to you this sort of offense is not so bad, it's on the "okay" side of the line, and to Mitch Kapor this offense is pretty bad, it's on the "not okay" side of the line.
I don't think either you or Mitch Kapor is a bad person here. But, maybe all this public outcry indicates it is worth you thinking for a bit if perhaps you are underestimating how bad it is to allow this sort of environment at your company. Maybe you have been thinking "hmm this sort of problem is X amount badness" and the reality is it's 3X units of badness.
Personally, this makes me more likely to want a Mitch Kapor investment. If I am founding a company then I really do not want the culture to be Uber-like in its treatment of women. In fact I'd like everyone working at the company to know that up front. After he called out Uber publicly, anyone taking money from Mitch Kapor in the future is making a statement that they care about their culture not ending up like Uber culture.
Anyway I can't see inside your head so I don't know if your real nuanced stance on this is right or wrong but I wrote this comment in the hope that you would reflect a bit and consider retuning your instincts on "how bad is this sort of behavior" to be more critical of it.
Totally agree with you about not wanting Uber-like culture. People should take affirmative steps to not develop that kind of culture. Investors should contribute to that. But, I don't see investors going public with their concerns about portfolio companies as contributing to solving that.
I would possibly feel differently if it were a situation where the investor had special knowledge of the incident, but otherwise, why should this one of ~1-100 people comment, when there are ~7b other people who could?
In addition to severity, we need to consider:
- the "impact" made by joining the conversation publicly
- other available means to exert the same level of influence
Given the size of the organization and the fact that it was already in crisis mode, I'd argue this won't really change much. And, if that's the case, then the breach of trust isn't really warranted.
As outsiders, it's impossible for us to truly determine how impactful this letter will be, or whether there were alternative means to achieve the same change.
Given imperfect information, where does that leave us?
Well, making business decisions always involves incomplete information. If there's uncertainty around whether said investor's actions were justified, and I have a choice to take money from another investor on equal terms, I'll take the alternative (all else equal).
This is a practical decision driven by caution - not a judgement of character on said investor (I have a lot more respect for Mitch as a person because he certainly considered the consequences of this letter).
I started a company while sharing office space with them--great people. I'm sure they've been working behind the scenes on this for a long time.
Being in the Kapor office I got a much more visceral experience of "diversity and inclusion" as a raise the bar strategy. Tons of smart people who were also happy and kind and productive.
Two things can be true: This can be a breach of trust, and the situation within Uber is so dire, with so many people being just terrible human beings, that this breach was necessary.
I wouldn't consider one of the (100?) investors Uber has to be responsible for Uber's actions, particularly since they're famous for ignoring their investors. Investors are most responsible for the investment decision itself; if they knowingly invested in Uber today, that's a different statement IMO than investing in Uber 4 years ago.
I would still prioritize fiduciary duty and privileged information/position as an advisor over anything else, unless there were criminal activity, in which case I'd bring it to the attention of the board and correct authorities.
I think you can criticize Travis and management a lot in private, and ultimately push for changes in management (although I don't think anyone would benefit from removing Travis!). Doing things in public is not helpful, though.
The other really helpful thing is probably a good reporting pipeline for employees if they think something criminal or illegal or unethical is happening. Less of an issue in a company the size of Uber (there SHOULD have been a way to report to someone...HR was weak, but legal/CFO?). In a smaller company, I'd consider an investor a good proxy for that.
It sounds like that's what they've been doing ("We are speaking up now because we are disappointed and frustrated; we feel we have hit a dead end in trying to influence the company quietly from the inside."). If the private approach doesn't work, what should one do?
(Doesn't apply to public companies, since you're appealing to potential co-investors. Doesn't apply in cases of criminal/etc. behavior when a founder or manager is replaced.)
I have two reasons for asking this. First, criminality seems a really low bar to set before you can speak up about an ethical issue, and second, not speaking up about questionable ethical behavior often enables criminality to continue - Bernie Madoff springs to mind as a simplistic example.
There are ~7b other people who can call out Uber's behavior who are NOT Uber investors. I don't think any particular value was added in this coming from Kapor vs., say, EKP. There are a lot of people who are not Uber employees or investors who have even more moral credibility here, too.
I don't see how people outside the team are supposed to call out bad behavior if they have no information about what's going on within the team because confidentiality is contractually enforced.
Not fully responsible, but still responsible. IMHO we are accountable for the consequences of our actions. As an extreme example, I shouldn't fund someone who uses slave labor. If I knowingly funded someone's violent, criminal act, I would go to jail.
Criminal activity is clearly a line which can't be crossed even for existing portfolio, but I don't think an investor is the one in a position to deal with that -- it's more for regulators.
Exiting the investment is probably the course I'd take before publicly calling out a portfolio company, for "non-criminal but terminally bad-for-brand" reasons.
Internal corporate governance (board/shareholder actions) would be before that, and extreme internal pressure before that. I'm absolutely not calling for investors to just let stupid stuff pass; I just don't blame investors for not taking action when not required, and I think there's a defined escalation path which doesn't include an open letter to a portfolio company which isn't public.
How so? Senior leaders at Uber seeking "advice on a variety of issues, mostly pertaining to diversity and inclusion" isn't a bad thing.
Clarifying that Travis Kalanick, the CEO, wasn't one of those senior leaders, doesn't breach anyone's trust.
Communication always has two sides. And if one side is not willing you can't just blame the other side.
And in this case, if the investor is pissed at Travis for not getting in touch (a different breech of the relationship), this is pretty good way of getting their attention (well, possibly).
Edit: disclaimer, I should declare my bias: #deleteuber
In early rounds, founders are looking for investors who will trust management to make decisions in the best interest of the company. EVEN if they don't agree with those decisions, it's expected that they'll be a team player and provide support in whatever way possible.
I'm sure Mitch thinks what he's doing is in the best interest of the company (and it probabily is!). But, he surely doesn't have perfect information on what's going on (only management has a full picture).
They also indicate they have been a "team player" during prior incidents:
"As early investors in Uber, starting in 2010, we have tried for years to work behind the scenes to exert a constructive influence on company culture. When Uber has come under public criticism, we have been available to make suggestions, and have been publicly supportive, in the hope that the leadership would take the necessary steps to make the changes needed to bring about real change."
So it's hard for me to fault them here.
For the sake of more thought provocation, what do you think about YC's "Founder Ethics" rules, and how would you want YC to respond if Uber were a YC company?
It's a particularly principled stance.
I don't think being a founder should mean that once the check clears your free to do whatever you want and answer to nobody. I don't think that's a very common arrangement.
These investors are looking for actionable steps that Uber is taking to improve. Not a one-size fits all band-aid PR statement or middle-management meeting.
Not only that, Uber wouldn't even give investors their revenue numbers:
I agree with you here, but I'm drawing a different conclusion. I think investors publicly taking their company to task should be an absolute last resort, but that it's justified in this case, because Uber's behavior is just that egregious.
Up to certain limits, and respecting certain ethical norms. Apparently the Kapors came to the conclusion that those limits had been reached, and that Uber's behavior ultimately failed to meet those norms. Or in their own words: "We are speaking up now because we are disappointed and frustrated; we feel we have hit a dead end in trying to influence the company quietly from the inside."
And so they felt it was time to act by other means.
Founders don't get unconditional support from investors. They aren't therapists or doctors or lawyers. When you take money from someone, you're giving them a promise in return. Yes financial gains are part of that promise, but so is conducting yourself ethically and ensuring that the "business" is just as successful as the "product". Treating your people right is part of the contract.
We're hardly in early rounds for Uber at this point. July 2016 was round 15 and Kapor's been invested in Uber since 2010 as angel investors (essentially round 1).
> who will trust management to make decisions in the best interest of the company.
And how is letting a culture like this go rampant "in the best interest of the company"?
> EVEN if they don't agree with those decisions, it's expected that they'll be a team player and provide support in whatever way possible.
I don't agree with you there either. It's not the investors responsibility or job to blindly follow the CEO. It's their job to advise them, to be asked for advise and to help correct course. But that also means you need to listen to them and when that's not happening investors need to ensure they're heard.
Therefore, I would hope that people with way bigger wallets than me would be held to the same standard.
From the sounds of things, management has anything but "a full picture". Which is apparently part of the problem.
It's just that the full picture turns out to be a giant dumpster fire, and they don't want to admit that publicly.
Because at this point there's a good chance principals are going to be telling a jury what did they know, and when did they know it.
Uber is facing a catastrophic crisis. This could kill the company, or at least cause massive attrition. If Uber isn't willing to take advice on how to get out of this terrible situation that it has created, it may well die.
And in situations like this, I find it a general rule to never give management the "benefit of the doubt".
Of course, I'm not trying to give you money, but I'd hope other founders don't learn from your behavior.
Blind app is anonymous, so obviously this is yet to be substantiated. If this attrition is actually taking place, we'll know very shortly.
They might have been safer if they were a snowflake. But the ride-hailing market has competition. Both from Lyft and just regular cab companies that are (slowly) starting to up their game.
I'm curious about the breach of trust you feel -- surely investors in a company don't relinquish their values or place unconditional trust in the company? The Kapors are not a PE firm, and their ethical stands have been known for decades.
You can't on the one hand benefit from the brand value of investors like Mitch & Freida and not also expect such stakeholders to also expect a certain caliber of behavior by the company.
I think investors in a startup are forgiving of early missteps. Uber is way, way past that stage.
And by "early rounds" you mean $2B, correct?
The way I read it, it sounds like they tried that and found the approach didn't work. So they moved on to "tough love" and are trying an intervention.
To turn that around, is there any situation in which you believe early-round investors can ethically discuss problems in public?
We've likely read Susan Fowler's blog post. If true, it's awful behavior on the part of HR and management at Uber, and action should be taken.
But that's the thing: a blog post does not establish truth. We've heard from only one side of the story. No one ever asks about the other side, or about whether we are being misled. We only talk about the bravery of the author and condemn the other side.
I think the saddest part of our collective behavior is how quickly we come with pitchforks to a witch trial. We must remember that justice is not decided on Twitter, or on blogs. Justice is not decided by the voice of the accuser.
Did you see evidence besides Susan Flower's putting phrases in quotation marks? She mentions screenshots of improper behavior but provides none. What if tomorrow new evidence comes out that this whole thing was exaggerated or flat out wrong. How would it feel, to being so easily manipulated into drawing a conclusion, into retweeting a fiction, into writing an open letter?
She didn't say opinions like "they were meanies to me" or "they gave a promotion to a man when I was the better performer." In that case, people would likely decide who to believe based on their priors.
Instead, she made specific accusations that, if false, Uber could easily show as false. Note that Uber has not even done that. Likely because she can prove the claims are true, in court if necessary.
That's just not true. There are numerous comments on HN that reflect exactly this sentiment, as well as every other point in your comment.
At this point, the accused (or Uber, for that matter) is perfectly free to make some announcement if they so choose. I wouldn't expect them to—nor fault them—as it wouldn't make any sense, politically or legally, to do so at this point, at least until the conclusion of any investigation.
2 years after a jury found that Ellen Pao was full of it, TechCrunch and other media still portrays her as a victim. Most likely they will do the same for Susan Fowler, even if (purely hypothetically) a court finds her to be full of it.
In such a media climate, you need to genuflect in the direction of all that the masses find holy regardless of the facts. At least if you are good at politics, which Uber is.
... found that Ellen Pao could not prove her case on the balance of probabilities. That's not the same thing as you just said.
As for Ms. Fowler, I don't expect her to be a neutral figure, and if you read her tweets, who called for boycott of her ex-employer based on false information, she clearly is not.
Why do you feel the need to make a throwaway account to state your views?
Lot of people have suggest these problems stem from the culture. Culture of companies and people is similar to the culture of, say, bread. The starter really matters and sets the tone. I'd be interested in hearing from people who have seen a drastic change in culture at a big place or better yet, have been behind that change.
The other idea is it could just be a few rotten apples giving everyone a bad name. I don't know the answer.
There's no such thing as this.
Honestly, is everyone these days completely ignorant of what happens when you leave a few rotten apples in a big bunch of apples? In case you don't know, the correct answer is that very soon, ALL the apples become rotten. That's why we have the old saying about "bad apples": "one bad apple ruins the whole bunch". Somehow, these days, everyone seems to have forgotten the "ruins the whole bunch" part of the phrase which is so important to its meaning.
It applies outside of apples too: it applies to police, corporations, any human organization really. There's no such thing as "only a few bad apples". An organization that tolerates rotten people very quickly becomes thoroughly rotten.
Next, deputise an ombudsman to whom every employee has a confidential and direct line. This ombudsman reports directly to the CEO and the Board. They should have a large amount of authority surrounding recommending dismissal of any employee to the CEO; whenever a recommendation is made, it should be copied to the Board. In return, the ombudsman should carry a significant amount of personal liability in connection with sexual harassment at the company.
This is how compliance works at many financial firms, and it's very effective. Compliance officers are deputized by the U.S. Treasury for anti-money laundering purposes. This makes them personally responsible if something goes wrong. It shows.
How about firing sexual harassers? And any HR staff that systematically lied to cover it up. And the people who gave them those orders. And not taking forever to do it.
Usually these are handled with a shake-up at the top, and other involved people being let go.