The ride-hailing wars hold a lesson for today’s political parties.
In 2015, my wife, Annie Lowrey, profiled the ride-hailing company Lyft. I remember being surprised by the debate she outlined in her story. The activist investor Carl Icahn had just invested $100 million with Lyft, and he was being forced to defend the proposition that investing in the second-biggest player in a massive new market made business sense. “There’s room for two, maybe three competitors in the area,” he said.
This was not, to say the least, a consensus view. “If you really look at this thing, it’s not gonna be a two-horse race. Lyft doesn’t survive. And Travis is never gonna buy it,” Chris Sacca, an early Uber investor, had said. “This is a winner-take-all game. And Travis will take all.”
At 1:30 am Wednesday, news broke that Travis Kalanick, the CEO of Uber, was resigning amid mounting scandal. “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,” he said in an email to the company. Icahn’s investment looks pretty good now. It turns out Kalanick will not, in fact, take all.
Uber is the most valuable private company in the world, and Kalanick’s bullheaded aggression is a big part of the reason. Both the ride-hailing giant’s extraordinary successes and its deep cultural failures reflect Kalanick’s personality and influence. It is very difficult to imagine the company in his absence. “This is shocking,” wrotetechnology journalist Dan Primack. “It’s this generation’s version of Steve Jobs being kicked out of Apple.”
The commentary today will focus on Uber, and properly so. But I’ve been thinking a lot about Lyft lately. Like many others, I’ve switched from Uber to Lyft over the past year. The decision was driven by discomfort with Uber’s obviously toxic culture. In the New York Times, Farhad Manjoo put it well:
Ride-sharing, as an industry and a civic utility, is too big an idea to be left to a company like the one Uber is now. The company that wins this industry is bound to become one of the world’s most powerful corporations. Its executives and culture will indirectly shape how we build cities, how we use energy, how we employ and pay people. We will entrust it with the safety and the security of our families, our streets, our private data and even, conceivably, the national infrastructure.
There was nothing inevitable about discomfort with Uber’s scandals driving a rush to Lyft. But Lyft, consciously or not, had correctly identified Uber’s weakness years ago. Uber was unfriendly, so Lyft would be friendly. Uber’s logo was sleek and silver and black, and so Lyft’s would be a bright pink mustache. Uber’s vision of driverless cars sounded like Skynet. Lyft painted a picture of a world with wider sidewalks and more parks.