On Tuesday, Travis Kalanick, co-founder of major transportation company Uber, announced that he would he be stepping down from his position as CEO.
Last week, Kalanick announced that he would be taking a leave of absence to grieve for his mother who died in a boating accident last month. However, some of the companies major investors believed that Uber was is in need of new leadership and so Kalanick’s absence should be permanent. According to the New York Times, the decision for Kalanick to resign was concluded by five of Uber’s top investors, including Bill Gurley from the venture capital firm Benchmark– one of the company’s biggest shareholders
The New York Times obtained a copy of the letter the investors sent to Kalanick; in the letter titled “Moving Uber Forward,” they requested him to resign immediately and that the company needed to change its leadership. “Talking to other shareholders, most of us don’t see how Travis can ever come back to Uber as CEO,” an Uber investor speaking on the condition of anonymity told The Washington Post.
The other shareholders who demanded Kalanick’s resignation include other venture capital firms who have invested in Uber during its beginning stage. Apart from Benchmark, First Round Capital, LowerCase Capital, Menlo Ventures, and Fidelity Investments, which together own more than a quarter of Uber’s stock, are the five top shareholders who demanded Kalanick’s resignation, the Times reported.
After agreeing to step down, Kalanick sent out an email to his 13,000 Uber employees informing them on the moves to come, the Post reported. The email said, “As you all know, I love Uber more than anything in the world, but at this difficult moment in my personal life, I have accepted a group of investors’ request to step aside, so that Uber can go back to building rather than be distracted with another fight. I will continue to serve on the board, and will be available in any and all ways to help Uber become everything we’ve dreamed it would be.”
For the past few months, controversy within the transportation company continuously made headlines, which could explain a reason why the investors came to their decision. One of the earlier scandals to break out this year was a complaint of sexism and sexual harassment by Susan Fowler, a former Uber engineer. In a detailed blog post, she highlighted what her experience was like while working for the company, and upon hearing this Kalanick announced that Fowler’s allegations would be investigated.
This month was also a hotbed of controversy for the company. In the first week of June, the company announced that it would terminate 20 employees, based on results found after an investigation into the reports of sexual harassment. Shortly after the 20 employees were fired, Uber fired Eric Alexander, the company’s president of business in Asia. Alexander was fired due to allegations that he had obtained and shared a woman’s medical records with Kalanick and another executive. The medical records belonged to a woman in India who sued the company for rape after a New Delhi Uber driver raped her in 2014. She filed a second lawsuit against the company this year for the mishandling of her medical records. Shortly after, Kalanick’s SVP of business and right-hand many Emil Michael left the company and is believed to be the other executive Alexander shared the woman’s medical records with.
Uber was a small start-up that was founded by Kalanick and his associate Garret Camp in 2009. The company officially launched in San Francisco in May 201o, and in December of that year, Kalanick became its full-time CEO. But now that he’s leaving, it means new leadership will be underway. According to the Times, the five shareholders have asked that Kalanick assist a board-led search committee for a new CEO and that Uber hire an experienced CFO.
“Over the next 180 days we are committed to making driving with Uber better than ever,” the company said in a statement. “We know there’s a long road ahead, but we won’t stop until we get there.”
