Powerful and deep read by Hubert Horan – really made me think differently about Uber!
Some of the best snippets:
“Most public criticisms of Uber have focused on narrow behavioral and cultural issues, including deceptive advertising and pricing, algorithmic manipulation, driver exploitation, deep-seated misogyny among executives, and disregard of laws and business norms. Such criticisms are valid, but these problems are not fixable aberrations. They were the inevitable result of pursuing “growth at all costs” without having any ability to fund that growth out of positive cash flow. And while Uber has taken steps to reduce negative publicity, it has not done—and cannot do—anything that could suddenly produce a sustainable, profitable business model.
“Uber’s longer-term goal was to eliminate all meaningful competition and then profit from this quasi-monopoly power. While it has already begun using some of this artificial power to suppress driver wages, it has not achieved the Facebook- or Amazon-type “platform” power it hoped to exploit. Given that both sustainable profits and true industry dominance seemed unachievable, Uber’s investors decided to take the company public, based on the hope that enough gullible investors still believe that the company’s rapid growth and popularity are the result of powerfully efficient innovations and do not care about its inability to generate profits.”
“From the outset, the investors’ strategy was to use massive subsidies to achieve extremely rapid growth. Their goal was to attract a massive valuation based on this growth and capital markets’ willingness to ignore the lack of profits because of the expectation that Uber would achieve the same type of growth economics as other prominent tech start-ups”
“In pursuit of high equity valuations and eventual industry dominance, former CEO Travis Kalanick established a ruthless, monomaniacal, “growth at any cost” corporate culture”
Read more via Uber’s Path of Destruction – American Affairs Journal
From magic to manic to toxic?