Uber CEO Dara Khosrowshahi says he aims to launch the initial public offering of the car-sharing service by 2019, with the backing of co-founder Travis Kalanick and the board.
Speaking at the New York Times’ DealBook conference on Thursday, Khosrowshahi said the entire Uber board now wants an IPO, TechCrunch reports. “The number support it”.
Major investors from Saudi Arabia and Japan are not pushing Uber to go public, “but it is the right thing to do – and by 2019″, he told the conference.
“We have all of the disadvantages of being a public company, as far as the spotlight is on us, without any of the advantages,” Khosrowshahi was quoted as saying in his first high-profile appearance since he became CEO.
“So Travis [Kalanick] and the whole board now agree we should just go public,” he added.
Khosrowshahi, who took over as CEO after Kalanick stepped down in June under pressure from some of Uber’s top investors, has been saying that an IPO was part of his plans, and that it would happen in the next 18 to 36 months.
His latest statement marks a clear divergence of thinking from the perspective of Kalanick, who famously wanted to keep Uber private as long as possible and saw no need to list with any urgency, TechCrunch said.
Khosrowshahi also said the listing plans have no bearing on plans for SoftBank to invest in the company.
He confirmed that the deal is pending and expressed confidence it will happen soon. “It hasn’t happened yet, but it will,” he said, adding that SoftBank has no “particular interest in [pushing Uber] going public, they are the ultimate long-term investor”.
SoftBank is in the middle of negotiations with Uber for a multibillion-dollar investment that would give the Japanese tech titan a 14 to 20 percent stake in Uber, the Wall Street Journal previously reported.
According to CNN Tech’s report, Uber currently has a valuation of US$70 billion, which makes it the world’s most highly valued startup. The company has raised more than US$10 billion in capital since its founding in 2009.
Confident of Uber’s long-term profitability, Khosrowshahi said the “math is working” in certain regions, and the company is simply subsidizing rides in most areas to get a foothold in those markets, CNBC reported.
The US business won’t be profitable for the next six months or so, depending on how rival Lyft performs, he said.
Khosrowshahi took the helm at Uber in August, after the company was rocked by a series of scandals and missteps.
“The culture went wrong, and the governance of the company went wrong and the board went in a very bad direction,” he said.
But one of the biggest obstacles to Khosrowshahi’s turnaround effort at Uber may be Kalanick, who was sparring with top investors, dividing the board of directors.
“The board went in a very bad direction,” Khosrowshahi said. “We’re reconstituting the board. It’s going to be a big board… Our bringing in SoftBank as a strategic investor at the right price would be a good thing.”
Khosrowshahi said he pushed Kalanick, who is still a board member, to back off, and he took it “very well”.
“I think he understands the ‘why’, which is that early on I’ve got to have my space… he’s been very plain with me that he wants to be involved in the company, and I’ve told him I want him involved,” he said during the on-stage DealBookinterview.
He has also reformulated the company’s cultural code from the bottom up while preparing to go public.
He apologized when Uber’s license to operate in London was canceled. “I think we were generally immature about how we dealt with regulators,” he said.
Speaking at the conference, Khosrowshahi cited some the changes Uber has made under his tenure, such as allowing drivers to take tips.
“Part of the issue is the cost of insurance, and the biggest winner in this is the insurance companies,” he said. “Believe me, we’re not making a ton of money here in the US on the drivers.”
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