I like the ride sharing business and use both Lyft and Uber, probably more Uber. It is very convenient when I have to go downtown for a meeting. It is cheaper than the cost of parking and less stressful.
I am concerned about the prospect of Uber ever — EVER — becoming profitable. You have to ask yourself how a company can come public at a huge value when they are neither profitable nor are they likely to be in the near term.
Hail, Uber! Uber went public last week with great fanfare befitting the third largest Initial Public Offering in US history. Hoorah, Uber! All hail Uber!
Then, they ran into reality and reality drowned them with surge pricing.
Uber came public at the low end of the proposed range (already a huge disappointment when compared to the investment bank courtship days) and promptly fell, making it the largest first day IPO loser in US history. Hello, America.
In fairness to Uber, the markets have been reeling with the US-China trade treaty negotiation news and the imposition of tariffs and retaliatory tariffs. [Trump’s fault?]
Lyft — a competitor — was also tanking adding to the cloud over the market and the IPO world.
First quarter of 2019 was a bust for tech Initial Public Offerings. Some blame it on the government shutdown and the inability to get the United States Securities and Exchange Commission to respond to preliminary S-1s (registration document). Fair play to that sentiment.
A company files an S-1, the US SEC reviews it, the SEC provides comments, and the issuer makes revisions in response to the SEC’s comments. Now, your preliminary S-1 has become a final S-1 and you are registered. In two weeks, you can begin banging your drum. If the government is shut down, this process doesn’t happen.
If you just take a Mulligan for Q1-2019 and focus on the rest of the year, you may see a deep lineup of tech companies, familiar names amongst them, getting ready to make the leap.
Here is my favorite recent public offering, demonstrating her flexible approach to the world. Can you reach down and grab your foot while in a seated position? Her name is Tempe and she is a Southern girl from Savannah. But, I digress.
The hype has begun on the Uber 2019 IPO – initial public offering of stock.
A Wall Street Journal article suggests that underwriters are whispering that the number is $120B – $120,000,000,000.
Of course, this is what’s called the “courtship” proposal — guys (the usual suspects Morgan Stanley, Goldman Sachs) looking for the assignment telling the prospective client what they want to hear to get the job; still it is a huge number.
New CEO, Dara Khosrowshahi, likes the big number and says, “Bring it.”
Why does this trouble you, Big Red Car, you ask? Let me tell you.
Big Red Car, which is not involved with Uber as a car or a driver, here on a slightly cloudy day with a warmer afternoon promised. Hey, it’s June and it’s Texas.
So, Uber is having a tough time. The entire leadership is melting down. Huh?
As we chat, dear reader, Uber has just dismissed its #2. [Note, the Big Red Car is not going to name names even if you already recognize the plight of Emil Michael, the bonehead who famously wanted to use the Uber travels of journalists to their disadvantage.]
So, as we write Uber has vacancies at COO, CFO, CMO, general counsel, and now at #2. There is talk of the CEO, Travis Kalanick taking a “leave of absence” to deal with a personal tragedy — the death and critical injury of his mother and father respectively in a boating accident. Condolences.
Big Red Car here on a slightly cloudy Texas day. It is a good day because The Boss’s North Carolina Tarheels prevailed while the wicked Dukies were defeated by the valiant South Carolina Gamecocks. Go to Hell, Duke. [The Heels didn’t exactly cover themselves in glory, but they won and they advance.]
Duke’s Grayson “Tripper” Allen catches a glimpse of the scoreboard which says: “Y’all are losers, Dukies.” OMG, is that sweet or what? [Full disclosure, the second the Tarheels are out of the Dance, the Big Red Car is all, “Go Duke!”]
So, “Uber Uber Uber alles, Uber alles in der Welt” is having a few cultural issues. Recognize them for what they are — cultural challenges which start at the top.
Cultures are defined by the VALUES of the top dog. Lots of folks want to believe that culture comes mythically from the Culture Fairy, but, alas, that is not so. The CEO (founder) defines the culture when he unpacks his values in his fancy new office.
Therein lies the problem at Uber. The top dog, one Travis Cordell Kalanick has some very questionable values. No, let’s not say that. Let’s explore what’s happening over there at Uber and let you decide. So, no judgmental nonsense from the Big Red Car. You decide.