Uber CEO Does Undercover Boss Routine After Churning Through World’s Rideshare Drivers (2024)

The most telling sentence in the Wall Street Journal’s feature story on Uber’s CEO Dara Khosrowshahi occasionally driving for his own company is the first one. It says that, “After five years running Uber, Dara Khosrowshahi in September got behind the wheel himself.”

The context of the story is that Uber has battled a driver and delivery worker shortage for years. It has struggled to square the circle on how to provide these services at a low enough price that people will be willing to pay for it but also pay its workers well enough so they keep doing it, all while financing a very expensive corporate operation that, for most of the company’s history, involved billions of dollars in losses trying to develop self-driving cars and other moonshots that went nowhere.

Simultaneously, Uber has had to balance what the WSJ calls “legal risks,” a euphemism for the high-profile and expensive fight over whether drivers should be classified as Uber employees or independent contractors. Uber led the fight by gig economy companies which spent in total more than $224 million to win Prop 22 in California, nullifying a state law that would have classified Uber’s drivers as employees because they have little control over their pay or work, which is guided by company algorithms. Prop 22 passed, ensuring drivers would continue to remain classified as independent contractors and Uber’s business model to remain viable. Uber won this fight in California and a subsequent court ruling in March mostly upheld its principles.

In order to make this legal argument that drivers are independent contractors, Uber and other gig economy companies have had to make a very strange argument: Their actual customers are not the riders who hail rides or the hungry people who order food through the app, but the drivers themselves. Uber said so in its own filing with the Securities and Exchange Commission for its initial public offering in 2019: “Because end-users access our platform for free and we have no performance obligation to end-users, end-users are not our customers.”

Which brings us back to the WSJ story. It is presented as a kind of Undercover Boss narrative. Khosrowshahi drove under the name “Dave K.” Khosrowshahi drove someone to the airport. Khosrowshahi drove someone to Oakland and got stuck in traffic. Khosrowshahi curates a Spotify playlist for his riders. Khosrowshahi forgot someone’s drink then blamed it on the app design (unlike a regular Uber driver, who merely gets slammed with a bad rating and zero tip, Khosrowshahi pinged an executive to change the app design). Khosrowshahi realized it actually sucks to not know how much you’re going to be paid before you accept a ride or where the ride will go, something Uber drivers have been complaining about since the app’s inception more than a decade ago, devising intricate theories for how to game the app to their favor, none of which are actually valid but provide an illusion of control the company only encourages.

Nothing about this is new. Back in 2015, then-Uber CEO Travis Kalanick told Stephen Colbert he drove an Uber and had a perfect five-star rating (for the record, Khosrowshahi claims to have one too). Lyft CEO John Zimmer also drove for the company on occasion. This phenomenon of CEOs getting down and dirty with the workers is nothing new or even interesting, a well-worn PR routine—if you have trouble spotting them, a good tell is when the publication sends a dedicated photographer along—dating back at least as long as Undercover Boss but never going out of style. A few weeks ago, Starbucks’ new CEO said he would pull some levers and push buttons to serve drinks amidst a national controversy over the company’s blatantly anti-union practices that saw former founder, CEO, and short-lived presidential candidate Howard Schultz hauled before Congress.

Nor are any of the issues, frustrations, or annoyances Khosrowshahi identified about being a driver new, particularly around the important stuff like driver pay. In 2019, I, along with my colleague Dhruv Mehrotra, investigated how much Uber and Lyft drivers were actually paid for each ride, data neither company publicly discloses. Using a dataset of more than 14,000 fares, we found Uber kept 35 percent of the revenue. Lyft kept 38 percent. Other studies found similar results. As with many other media stories over the years voicing the same frustrations Khosrowshahi found for himself, the company’s public relations team denied the veracity of our findings and quibbled with our methodology. But when we talked to drivers for the story, we heard many of the same complaints Khosrowshahi voiced to the WSJ.

Which is why the first sentence of the WSJ story is so telling. Khosrowshahi has been leading Uber for more than five years. The company’s public position has been, up to this point, that the drivers are its customers. But he never actually bothered to find out what the customer experience was like until now. What kind of CEO waits five years to find out what his own customers’ experience is like? A CEO who knows a legal fiction when he sees one and can finally drop the pretenses once it is cemented into law.

There is one other telling line from Khosrowshahi in the WSJ that bears mentioning. Back when Kalanick was on Colbert in 2015, he said the future of the company was robotaxis. “Google is doing driverless, Tesla is doing driverless, Apple is doing driverless,” Kalanick said. “This is going to be the world. Do you want to be part of the future or do you want to resist the future?” Lyft’s co-founder John Zimmer echoed that in 2016, predicting a “majority” of Lyft rides would be driverless in 2021—actual percentage: zero—and, by 2025, “private car ownership will all-but end in major U.S. cities.”

This was the big bet, that the whole driver classification/customer issue would solve itself by getting rid of the driver. It reminds me of the summer of “production hell” Tesla underwent in 2018 trying to get the Model 3 off the assembly line because Elon Musk had tried to automate the entire factory only to find it didn’t work. Musk’s conclusion: “Humans are underrated.”

Or, as Khosrowshahi told the WSJ, “I think that the industry as a whole, to some extent, has taken drivers for granted.”

Uber CEO Does Undercover Boss Routine After Churning Through World’s Rideshare Drivers (2024)

FAQs

Uber CEO Does Undercover Boss Routine After Churning Through World’s Rideshare Drivers? ›

Uber CEO Does Undercover Boss Routine After Churning Through World's Rideshare Drivers. After five years in charge and amidst a mass driver shortage, Dara Khosrowshahi

Dara Khosrowshahi
Dara Khosrowshahi (Persian: دارا خسروشاهی, Persian pronunciation: [dɑː'ɾɑːxosɾo'ʃɑːhiː]; born May 28, 1969) is an Iranian-American business executive who is the chief executive officer of Uber. He was previously CEO of Expedia Group, a company that owns several travel fare aggregators.
https://en.wikipedia.org › wiki › Dara_Khosrowshahi
finally figures out who Uber's customers are. Moveable explores the future of transportation, infrastructure, energy, and cities.

Did Uber's CEO became an undercover boss? ›

Uber's CEO says he got 'tip-baited' when he became an undercover boss in a used Tesla. Uber's CEO moonlighted as a driver last September to better understand why recruitment was an issue. Dara Khosrowshahi told The Wall Street Journal he encountered problems that discouraged drivers.

How much does Dara Khosrowshahi make? ›

Uber Technologies Inc reported in 2023 that Khosrowshahi's total compensation last year rose 22% to $24.3 million. Khosrowshahi is on the list of "Prominent Iranian-Americans" published by the U.S. Virtual Embassy Iran. Khosrowshahi's net worth is estimated to be at least $170 million as of June 2023.

What is Uber CEO doing now? ›

He is now CEO of CloudKitchens, a global virtual restaurant company that raised money from Microsoft and the Saudi sovereign wealth fund. Kalanick cofounded two tech startups before Uber: online file-exchange service Scour and file-sharing company RedSwoosh.

How did Dara Khosrowshahi change Uber? ›

Creating New Company Cultural Values

CEO Khosrowshahi reduced Kalanick's 14-point aggressive company culture value statements to just eight, based on employee input. These new statements were embraced and validated by some 22,000 Uber employees to guide the company forward.

What happened with the CEO of Uber? ›

Kalanick was CEO of Uber from 2010 to 2017. He resigned from Uber in 2017, after growing pressure resulting from public reports of the company's unethical corporate culture, including allegations that he ignored reports of sexual harassment at the company.

What happens when Uber CEO started driving for Uber? ›

It was the latest experiment in the CEO's yearslong journey to reinvent driving on Uber. Along the way, he struggled to sign up as a driver, saw firsthand something called tip baiting and was punished by the app for rejecting trips. Surprisingly hard to take was the rudeness of some Uber riders.

Who is the most over paid CEO? ›

The most overpaid, in their analysis, was Warner Brothers Discovery (WBD) chief David M. Zaslav, who was paid nearly a quarter billion dollars in 2022 only to deliver a five-year annualized total shareholder return of -11.6%. The chart below shows how the top 10 most overpaid CEOs performed relative to the S&P 500.

Who is the highest paid DoorDash CEO? ›

DoorDash's CEO Tony Xu earns the distinction of being the biggest earner in the pandemic year, nabbing $413 million in compensation last year — nearly all of which were in the form of stock awards.

Who is the ex girlfriend of Uber CEO? ›

Gabi Holzwarth, the ex-girlfriend of Uber CEO Travis Kalanick, has revealed even more details on the ride-sharing company's workplace culture.

Who now owns Uber? ›

The ownership structure of Uber Technologies (UBER) stock is a mix of institutional, retail and individual investors. Approximately 46.81% of the company's stock is owned by Institutional Investors, 18.44% is owned by Insiders and 34.75% is owned by Public Companies and Individual Investors.

What does Uber stand for? ›

Experiencing the common urban woe of not getting a cab in a storm, Travis Kalanick and Garrett Camp soon brainstormed an idea for a new company called UberCab. The name Uber is derived from the German word meaning "above all the rest," a bedrock principle Kalanick and Camp wanted for their fledgling company.

What is Uber CEO salary? ›

Uber CEO's 2022 base salary was $1 million

Chief Executive Dara Khosrowshahi's total compensation last year rose 22% to $24.3 million, the company disclosed Tuesday.

Is Dara a good CEO? ›

Uber's CEO, Dara Khosrowshahi, has 745 employee ratings and a score of 90/100, placing them in the Top 5% of similar size companies on Comparably with 10,000+ Employees and Top 5% of other companies in San Francisco.

How many shares of Uber does Dara Khosrowshahi own? ›

The company's market cap was in excess of $161 billion at the end of 2023. Dara Khosrowshahi was Uber's top individual shareholder as of November 2023 with 1,016,240 shares. The Vanguard Group was Uber's top shareholder as of December 2023 with 167.63 million shares.

Who gave away the most on Undercover Boss? ›

Modell's Sporting Goods - $334,000+

Most notable from the episode of Undercover Boss about Modell's featuring CEO Mitchell Modell was when he had one employee in complete shock after revealing that he was giving her $250,000, according to New York Daily News.

Did people know they were on Undercover Boss? ›

Additionally, the employees' backstories are real, which is why the producers carefully chose them beforehand, choosing only those with stories that would work well on television. Given the popularity of the show, the majority of employees have already realized they are on Undercover Boss.

Does Undercover Boss still exist? ›

EMMY AWARD-WINNING SERIES “UNDERCOVER BOSS” RETURNS FOR ITS 11TH SEASON, FRIDAY, JAN. 7, 2022 ON CBS!

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