July 31, 2017
“Hayashi got a close look at the city’s taxi system, which had a fifteen-year waiting list for medallions, caps on the number of cars allowed, and nonexistent service outside of downtown and the airport. Everyone knew the taxi rules needed to be changed but no one could agree on how to do it. In 2009, Mayor Gavin Newsom asked her to overhaul the medallion system for the first time in thirty-two years and to install a New York City–style auction process to raise capital for the city. Hayashi worried that an auction would make medallions unaffordable for most drivers and came up with a new set of rules that raised the price to $250,000, offered low-interest loans to drivers, and gave older drivers a way to cut back on their hours.”
July 31, 2017
“Hayashi wielded a fast wit and plenty of personal charm to deal with cranky cab-industry vets who were hostile to change. But the fighting took its toll; she says she was “badly battered” by the credit card and medallion fracases and started to see her work as thankless. “I always joked my job was safe because no one else wanted it,” she says. “The drivers hate you because their wife doesn’t love them and their children are ugly and it’s all your fault. The taxi-fleet managers don’t like you because they aren’t making any money. And any regulation is too much regulation.”
July 31, 2017
“n the summer of 2010, Hayashi’s phone started ringing off the hook, and it wouldn’t stop for four years. Taxi drivers were incensed; a new app called UberCab allowed rival limo drivers to act like taxis.”
July 31, 2017
“Every time Hayashi picked up the phone, another driver or fleet owner was screaming, This is illegal! Why are you allowing it? What are you doing about this? She knew many of these drivers and fleet owners personally and had done her best to balance their interests along with the public’s, but the result had been a system that didn’t serve passengers or the city particularly well. Then Uber had radically tilted the entire playing field. The enraged drivers “were right,” Hayashi says. “We are sitting here regulating the hell out of these poor guys and then we just ignore what was going on?”
July 31, 2017
“Hayashi says that she was strident, not screaming, and remembers the Uber execs as “obnoxious” and Kalanick in particular as “arrogant.” “You can’t do this!” she told them. “You can’t just open a restaurant and say you are going to ignore the health department!”
July 31, 2017
“Kalanick was still in his self-described “burnout phase” after his last full-time job.4 He was traveling around various countries in Europe and South America, wearing a dorky cowboy hat; when back at home, he applied his capacity for manic focus to mastering video games like Wii Tennis and Angry Birds. Chronically restless, he was also investing and advising various startups and giving occasional speeches about his past misadventures as an entrepreneur.”
July 31, 2017
“Talented with numbers, Kalanick got a perfect score on the math portion of the SAT and became a neighborhood tutor. ”
July 31, 2017
“Kalanick lived at home during college and pursued a computer science degree. But this was the late 1990s, and for those whose interests lay at the intersection of entrepreneurship and computers, the siren call of the internet was irresistible. Kalanick dropped out of school his senior year, 1998, to join six classmates developing one of the web’s first search engines, Scour.net. The site, which debuted around the same time as Google, let people search the computers of other students on university networks for multimedia files like movies, TV shows, and songs. Most of those files, of course, were being hosted and downloaded online for free, in violation of copyrights.”
July 31, 2017
“Kalanick and his colleagues believed they could work with rights holders to create a more efficient and economical way to distribute media over the internet. When the rogue file-sharing service Napster took Scour’s technology a step further, allowing people to not only search for files but pass them back and forth, Scour moved quickly to catch up. It introduced its own version of the technology, called Scour Exchange, which made it even easier to trade audio and video files without paying.
Then Hollywood woke up to the impact of peer-to-peer file sharing and moved swiftly to crush it.”
July 31, 2017
“Scour’s attorneys, like Napster’s, believed the company was protected by the “safe harbor” provisions of the Digital Millennium Copyright Act of 1998, which stipulated that internet companies could not be held liable for the activities of their users. Scour, they argued, wasn’t hosting the content, only pointing to it. But the startup couldn’t hope to fight the combined might of the entire media industry. It laid off most of its staff in the fall of 2000 and declared bankruptcy to escape the litigation.16 “That’s when we really learned how the world can work,” says Droege. “It’s not whether or not you are right or wrong.”
July 31, 2017
“Despite that setback, Kalanick was ready to dust himself off and try again.19 He started talking to one of his Scour co-founders, Michael Todd, about redeveloping the technology behind Scour and selling it to media companies as a tool to help them distribute their material online”
July 31, 2017
“Kalanick tried to raise money in 2001, right in the midst of the dot-com bust. Silicon Valley was a ghost town. At a local bar in Palo Alto, a venture capitalist told him that all innovation in software had been done and there was nothing left to invent.21 On September 11, he had a meeting scheduled in L.A. with Daniel Lewin, a co-founder of the Boston-based streaming-media company Akamai. Lewin was on American Airlines Flight 11 and died in the terrorist attacks.”
July 31, 2017
“Kalanick, twenty-seven, was now utterly alone. He had lived at his parents’ house for a year and had gone without regular paychecks while pursuing deals with companies like Microsoft and AOL, only to watch them invariably fall through.”
July 31, 2017
“At some point even your friends are like, ‘Dude, you need to do something else.’ To keep going in the face of that can be a lonely existence.”
July 31, 2017
“Kalanick may not have considered himself a serious candidate for governor but he stubbornly believed he could make Red Swoosh work. Internet mogul Mark Cuban saw promise in the idea and, despite the fact that Kalanick had no regular employees, invested a million dollars in the business in 2005. It was enough to keep going. “I like to call these my blood, sweat, and ramen years,” Kalanick said. “I always very much believed in what we were doing.”23”
August 1, 2017
“Kalanick had endured the most grueling experience of his life and emerged as battle-hardened and defiant as ever. Around this time, he went out to a nightclub in San Francisco with several friends, including Napster co-founder and Facebook investor Sean Parker. At the end of the night, inebriated, Kalanick was waiting for his friends outside the nightclub when an imperious bouncer told him to move away from the door. Kalanick moved only a few steps away. “Keep going,” the bouncer ordered. Kalanick inched over another step. “Keep going,” the bouncer said menacingly. “I’m not breaking the law. You tell me how I’m breaking the law,” Kalanick replied.
By the time a nearby police officer arrived, the bouncer was forcibly trying to move Kalanick while he defiantly gripped a parking meter with both hands. He was arrested for obstruction of the sidewalk and says he spent eight to ten hours in the city jail before Parker realized what had happened and put up two thousand dollars to bail him out.25
“Fear is the disease. Hustle is the antidote,” he said at a Chicago startup event a few years later.26 “You start a company in 2001, good[…]”
August 1, 2017
“Uber had the data to make those kinds of prescient decisions. In fact, it was slowly dawning on the founders and board members that Uber was going to have more data about how people moved around cities than just about any other company in history. “I’m an engineer at heart and math moves the needle on this,” Kalanick told me a few years later. “My happy place is right in the midst of all that complexity.”
August 1, 2017
“The California Public Utilities Commission wanted Uber to register itself as a limo company or, technically, as a “charter party carrier,” but Uber’s lawyers believed the company could make the case that it was merely an intermediary between drivers and riders, not an actual fleet operator. It was as much a limo company as Orbitz or Expedia were airlines, they argued.”
August 1, 2017
“After that first meeting with Hayashi, Kalanick spent weeks negotiating with Garrett Camp and angel investors Chris Sacca and Rob Hayes over his compensation as CEO. He somehow calculated that he needed a 23 percent ownership stake in Uber, up from his 12 percent stake as a founder and adviser, but declined to explain his logic. The other board members didn’t want to dilute their own holdings but ultimately acquiesced. “The best thing I ever did for Uber was completely roll over in negotiations with Travis,” says Rob Hayes.”
August 1, 2017
“The bottom line is that I’m all in on Uber,” he wrote.
The excitement and joy of being Uber is coming out my pores and I’ll stop at nothing to see Uber go to every major city in the U.S. and the world. So what’s next? Taxi frustration is going down. Reliability, Efficiency, Accountability, and Professionalism in urban transportation are going way up. Every city Uber rolls into is going to be a better place when we’re done with it and if you live in that city, your world of transportation is changing forever, and it will be oh so Uber when that change arrives.
”
August 1, 2017
“As 2011 began, Kalanick had another big move in mind. It was time for Uber to raise its first significant round of funding, the Series A. He wanted to work with one investor in particular: Benchmark’s Bill Gurley, who had previously expressed interest in the seed round.”
August 1, 2017
“Benchmark almost scuttled the deal with a practical joke. Kalanick was on Sand Hill Road in Menlo Park to visit rival Sequoia Capital before a scheduled meeting with Benchmark’s partnership. As they waited for Kalanick to arrive, Gurley and his partner Matt Cohler looked at the Uber app and saw a single Uber car in front of Sequoia’s office a mile away. Because Uber did not yet operate down in Silicon Valley, they guessed this oddly idle car was Kalanick’s ride. Cohler summoned the car with the Uber app on his phone, and when Kalanick came out of his meeting, it was gone. He had to run over to Benchmark in his dress shoes, and he arrived sweating and late. That night, the firm sent Kalanick a pair of running shoes. “I don’t know why we thought that was a good idea,” Gurley says of the prank”
Notes From: Brad Stone. “The Upstarts.” iBooks.
