Uber’s pick for CEO, Dara Khosrowshahi, might be the anti–Travis Kalanick.

Uber’s Pick for Its New CEO Might Be the Anti–Travis Kalanick

Uber’s Pick for Its New CEO Might Be the Anti–Travis Kalanick

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Aug. 28 2017 1:08 AM

Uber’s Pick for Its New CEO Might Be the Anti–Travis Kalanick

He knows how to run a profitable company, employ a diverse, happy workforce, and stand up to Trump. Could Dara Khosrowshahi redeem Uber?

Annual-Allen-And-Co-Investors-Meeting-Draws-CEOs-And-Business-Leaders-To-Sun-Valley-Idaho
Dara Khosrowshahi attends the annual Allen & Company Sun Valley Conference in Sun Valley, Idaho, in 2016.

Drew Angerer/Getty Images

Dara Khosrowshahi, the current CEO of Expedia Inc., has been picked as the CEO of Uber following a turbulent search for a new leader for the ride-hailing giant, multiple outlets reported Sunday night. As the head of the Seattle-based Expedia, a company with more than 20,000 employees, the 48-year-old Khosrowshahi oversees what is practically a cottage industry of travel sites owned by the company, including Travelocity, Orbitz, Egencia, Hotwire, and Hotels.com. One other thing he has going for him? He just might be the anti–Travis Kalanick.

Facing pressure from board members, Kalanick stepped down as CEO this summer amid a series of controversies at Uber, including allegations of a culture of rampant sexual harassment, a lawsuit that accuses the company of stealing intellectual property from Google, a Department of Justice investigation into Uber’s aggressive business tactics, and allegations that Kalanick and other top executives attempted to discredit a woman who was raped in an Uber in 2014. The search for a new CEO has been roiled by board infighting and a contentious lawsuit from one of Uber’s early, most important investors, Benchmark Capital, which accuses Kalanick of fraud and, if successful, would force the ousted CEO off the board for good. The other final candidates for Uber’s CEO were reportedly Meg Whitman, the current CEO of Hewlett-Packard, who bowed out of the running last month but apparently remained in the race, and Jeff Immelt, the CEO of General Electric, who pulled his name from consideration Sunday. Unlike Khosrowshahi, neither of those candidates hails directly from the transportation industry.

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If Khosrowshahi accepts the job, he’ll take the helm of a company that seems to be in self-destruct mode. But looking at his history of building one of the most powerful online transportation empires in the world, he is clearly a compelling choice to take over the troubled Uber. Khosrowshahi, after all, was responsible for his previous employer InterActiveCorp’s acquisition of Expedia in 2003. The company spun out into a separate entity in 2005, and Khosrowshahi was named CEO. Expedia Inc. ended 2016 with $8.77 billion in revenue. Uber is currently valued at nearly $70 billion but is not profitable. In fact, Uber estimates it lost $708 million in the first three months of 2017 alone, though that’s less than the $991 million the company lost in its previous quarter; many investors see the regular loses as par for the course as the company continues its aggressive growth spurt. And, to Uber’s credit, despite an unending string of bad press, it managed to report an uptick in ridership this summer.

Uber’s incoming CEO immigrated to Terrytown, New York, in 1978 from Iran, right before the revolution, when he was 9 years old. In Iran, Khosrowshahi’s family owned a chain of manufacturing plants. When he was 13, Khosrowshahi’s father traveled back to Iran to take care of his father and was detained for six years before he returned to the United States. Given his own experience as a refugee, it wasn’t surprising earlier this year when Khosrowshahi was among the first in the tech industry to sign on to legal action challenging the Trump administration’s travel ban on individuals from seven majority-Muslim countries.

"Hopefully we will all be alive to see the end of next year,” Khosrowshahi lamented on an investor call in February, a comment that was widely interpreted to be a dig at President Trump. The day after Trump won the election, Khosrowshahi expressed on Twitter his dissatisfaction with his fellow leaders in the tech industry, charging that they “have to admit that we are hugely disconnected with our nation.”

Kalanick joined one of Trump’s business advisory councils but resigned from the role in February, following the administration’s travel ban—as well as a swell of public pressure that resulted from the massive #deleteUber campaign, which followed an (overblown) accusation that the company had engaged in union-busting and was helping to normalize the new Trump administration. Kalanick’s frequently ruthless approach to management seemed to reflect his fondness for libertarian favorite Ayn Rand, particularly her veneration of powerful, society-bucking makers. That brash attitude has certainly helped the company become one of the most valuable startups in the world. But it also helped incubate many of the problems that eventually led to Kalanick’s sidelining.

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Fortune named Expedia one of the best places to work in tech in 2017—a distinction unlikely to soon be applied to Uber, which has been accused of covering up numerous cases of sexual harassment at the company, not to mention a founder who nicknamed his company “Boober” and who once wrote an inappropriate letter to employees encouraging them to only have consensual sex with each other.

Uber, a company with about 12,000 employees, released its diversity numbers in March. Female employees account for 36 percent of its total workforce, and about 15 percent of Uber’s technical staff are women. Expedia Inc., on the other hand, employs a U.S. workforce that is 50 percent female, and 25 percent of its technical staff are women, which is high for the industry.

Khosrowshahi reportedly took in $94 million last year, the vast majority of which came in the form of stock options awards after Khosrowshahi entered into a long-term agreement to stay with the company until 2020. It now seems that won’t happen.

Could Khosrowshahi jump-start a new era for Uber—and put an end to its monthslong soap opera and nest-of-vipers work culture? Uber has ambitions to transform the global transportation industry, with on-demand contract workers, self-driving cars, and even plans to bring vertical take-off flying cars into its fleet by 2020. For his part, Khosrowshahi helped transform how Americans buy plane tickets and book hotels; he’s also shown himself to be a leader for whom questions of morality ride on a lot more than his company’s bottom line.

The biggest challenge Khosrowshahi might face, of course is the man he’ll replace, who retains a seat on Uber’s board and who has shown an eagerness to continue meddling with the company he founded—one he clearly hopes to eventually lead again.