Uber CEO Dara Khosrowshahi will be the first person to tell you why his company sucks.
In fact, he once hosted an all-hands presentation for Uber staff titled “Why We Suck,” in which he detailed a “lack of quality” in the product.
“It wasn’t a pleasant all-hands with the company,” Khosrowshahi recalled at an event on Wednesday. “But it set a tone.”
In a conversation with Ford CEO Jim Farley at GE’s The Lean Mindset event in New York, Khosrowshahi explained that he had the “luxury of coming on board when Uber had a huge crisis moment” back in 2017, and that the company was in dire need of a culture change. Khosrowshahi joined the ride-hailing giant, once the world’s most valuable startup, at a tumultuous period defined by executive resignations, a $4.5 billion annual loss, an investor revolt, and even a #DeleteUber movement.
The catalyst for some of those changes at Uber came in the form of the COVID-19 pandemic, a period that also inspired Khosrowshahi to moonlight as a driver for the app.
“I was going, pardon my French, frickin’ crazy at home during COVID, and I wanted to get the hell out of the house,” Khosrowshahi explained. “I wanted to find some way of being constructive out of the house, so I got an e-bike and started delivering food for Uber.”
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While he previously told the New York Times he “nearly got killed” trying to deliver food on San Francisco’s busy streets in 2021, Khosrowshahi later expanded his experiment, known as Project Boomerang, to also include trips as an Uber driver.
“For me, once I saw what I believe was a lack of quality with the product as it related to delivering, then I bought a Tesla, and I started driving as well,” Khosrowshahi said.
Behind the wheel of a used Model Y, Khosrowshahi began transporting riders around San Francisco under the alias Dave K. He described the experience as “great,” but also “tiring” with a product that was difficult to understand.
“It showed me literally that we as a company culturally were very much focused on the rider and the eater product because we used it ourselves,” Khosrowshahi said. “But we didn’t take pride in the driver product because very few of us drove.”
But what started as an effort to better understand the experiences of drivers quickly became a pivotal moment for the company’s structure. Khosrowshahi sent notes to his engineers on ways to improve and became more “public” with the company about his thoughts on the product.
Khosrowshahi presented his findings to the wider Uber team during his infamous “Why We Suck” presentation.
“We set that expectation—we started celebrating employees going out there delivering, employees driving,” he said.
Now the driver experience is a “point of pride” for Uber employees, according to Khosrowshahi, and results in a badge on staff’s corporate profile.
Flying cars, e-bikes, and autonomous vehicles
The lessons learned during the pandemic are not something Khosrowshahi will let himself forget, since he replays the “unbelievably unpleasant” experience every year.
“Speed bumps for Uber are like a Thursday—we expect them,” he said. “The biggest speed bump we had–and I felt like an anvil hitting us on the side of the head—was COVID.”
Before the pandemic, Uber was experimenting with autonomous technology, manufacturing bikes and scooters, and even making plans for flying cars. These aspirations “just weren’t core to what Uber does, and frankly, we sucked at [them],” Khosrowshahi said.
Coupled with the economic strain from the pandemic, including losing 85% of its passenger-trip volume, according to Khosrowshahi, the ride-sharing company needed to refocus its efforts on what it excelled at: software and building marketplaces.
“In hindsight, it shouldn’t have been COVID that caused us as a company to really focus on what we were great at,” Khosrowshahi admitted.
“That event caused the company to come together, that event caused the company to have a growth mindset,” he said. “It was a huge shift in how we operated.”