Editor’s Note: Peter Sims is a former venture capital investor. He is an entrepreneur and the author of “Little Bets” and co-author of “True North.” The views expressed in this commentary are solely those of the author.
Peter Sims: The question is: How can a company like Uber get away with such egregious behavior over and over again?
Until companies like Uber move toward stronger corporate governance, bad behavior is unlikely to change, he writes
It’s a sad statement about Silicon Valley today that virtually no one there is surprised about the latest developments at Uber, including allegations of sexual harassment, or a video of the co-founder and CEO berating an Uber driver.
These are only the most recent in a long line of incidents from a company that has celebrated disruption above community, and prized money, power and control above morality.
The natural question is: How can a company like Uber get away with such egregious behavior over and over again? Uber is a poster child of this Silicon Valley era: As long as the business is growing, companies can be amoral at best, immoral at worst. Until companies like Uber move in the direction of a stronger corporate governance, that is unlikely to change.
First, some context.
I have some personal experience with the company. Like many, I once loved Uber’s service. Then, one night in 2011, I was in an Uber in New York when I started getting text messages from a woman I had only met once telling me my exact location, street by street. Dismayed, I looked around to see if she was in an adjacent car. It turned out she was at the launch event for Uber’s Chicago operation, and my identity was displayed on a screen, along with other “tech notables,” as the woman described it.
Furious for the violation of my privacy, I immediately stopped using Uber. Later, after seeing Uber do a range of unethical things such as create and cancel 5,550 Lyft rides, I wrote about my experience, asking whether Uber could be trusted. When that blog post went viral, an editor suggested I get in touch with Uber co-founder and CEO Travis Kalanick, and give him a chance to respond. I did just that, but he never replied to my emails.
It’s no secret that Kalanick, who actively shapes Uber’s culture, is known for treating people as a means to an end.
I have heard the company’s culture described to me routinely by Kalanick’s colleagues as “toxic.”
One can only imagine what it would be like to be a woman inside Uber. Lawsuits will pile up soon enough, and that may be the only thing that will change Uber.
The real story about Uber’s egregious behavior starts with weak corporate governance, especially in an era in which some Silicon Valley founders take nearly total control of their companies. Google founders Larry Page and Sergey Brin popularized a “three-class share structure” whereby their shares hold 10 times as much voting power as common shares, while giving no voting rights to employee shares. Facebook founder Mark Zuckerberg followed suit, allowing him to maintain control as well, as did Snap in preparing for its IPO.
These structures take power away from everyone but the founders.