Dara Khosrowshahi: How I Became CEO of Uber; Uber Eats vs DoorDash; The Postmates Acquisition | E994

1. 0:00 – 3:29

   Dara’s Journey from Iran to America

   1. DKDara Khosrowshahi0:00

      If I didn't wanna make mistakes, I'd be a treasury bond manager. All right, like, my job is to make (laughs) mistakes and learn from them.

   2. HSHarry Stebbings0:08

      (instrumental music) Dara, I am so excited for this. I've heard so many good things. As I said, Ali, Hadi, there was Daniel Ek, Ovide. I know your whole family history now. But thank you so much for joining me, Dara.

   3. DKDara Khosrowshahi0:21

      Happy to do it, uh, with that introduction. I hope I don't disappoint.

   4. HSHarry Stebbings0:24

      Uh, I think it'll be fantastic. But I wanna start with something from Ali actually, 'cause Ali told me about your family in Iran losing everything way back. And I will believe that we're kind of functions of our past, and so I'm really diving in at the deep end. But what would you say you're running from when you think about that?

   5. DKDara Khosrowshahi0:40

      God, it's, um... Uh, I do think that the events of Iran and our family losing everything, and, and we had a huge family, big family business, et cetera. I don't know if it's something that we're running from, but I think the whole family, to some extent, is running to rebuild essentially what we lost in Iran. You've got a next generation that is incredibly passionate and ambitious if you look at, uh, my cousins, Ali and Hadi, et cetera. It's just an example, which is, I think, we just have this immigrant chip on our shoulder. And we very much look up to our parents who built this incredible business in Iran, and we all wa- we all want to do our parts to rebuild again. And I think that's definitely shaped the ambition that my family has. Uh, I will tell you that while we lost all of our money in the business, so to speak, the, the thing that we never lost was family. And so for me, personally, the having the family around us, having that sense of love and belonging and protection is something that I treasure. And building that collective and having that shared success, like for example, in business, for me, is something that really draws me. For me, like, you know, celebrating your, uh, success as an individual is not nearly as fun as celebrating as a family or a team. So for me, I think family has shaped how I look at success, and for me, success is, is joint success, is shared success.

   6. HSHarry Stebbings2:13

      My family actually lost everything too when I was young, and I always equate... Uh, I told you, forget the schedule, we don't really stick to it. Uh, we always... Uh, I, for me, when I lost everything, I equated rebuilding with worthiness. When I rebuilt it back, I would be worthy again. The trouble is, Dara, I've kind of rebuilt a little bit (laughs) of it back now, and I don't really feel that worthiness. How do you think about worthiness in that rebuilding and whether that's kind of part of it?

   7. DKDara Khosrowshahi2:39

      I think for us, there's always been this sense of pursuit of excellence. So, I don't think with my family it's about, you know, rebuilding, or worthiness, or money one way or the other, but it's about pursuit of profession. You know, my dad told me, "Hey, you can, you can be two things. You can either be a doctor or an engineer. Pick one." So there's always this drive that, uh, my parents instilled in us. But for us, being worthy is not about an end state. It's about going all in, putting in the effort, being diligent, working hard, uh, and, and doing the hard work, and that's what drives me. If I, if I feel like I put in the hard work, sometimes it's gonna work out, sometimes it doesn't. Uh, but if I put in the work, then I'm worthy that day, and then the next day, I gotta come back.

2. 3:29 – 6:36

   From Expedia’s CEO to Uber’s CEO

   1. DKDara Khosrowshahi3:29

   2. HSHarry Stebbings3:29

      I mean, speaking of putting in the work, Dara, you had an incredible run at Expedia. And I chatted to our mutual friend, Daniel Ek, before the show, and he said, "You know, Dara had this incredible run at Expedia, and then the Uber opportunity came up." And so I, I was wondering, can you take me to that decision? Um, how, what were you thinking, and what was that decision-making process for you?

   3. DKDara Khosrowshahi3:50

      Yeah, I actually have Daniel to, to thank or blame, depending on-

   4. HSHarry Stebbings3:54

      (laughs)

   5. DKDara Khosrowshahi3:55

      ... the day, uh, as it relates to introducing me to, to the opportunity. I had been reading about Uber's troubles in the news just as everyone else, and to some extent, had been watching in a- in amazement. And Daniel had, I think, pointed the company or headhunter to me. And we were having drinks, and he let me know. He said, "Dara, like, do they give you a call?" And they had given me a call, and, and my first answer was, "Hell, no." And I was telling Daniel, "Listen, I've been here for 13 years. I'm having a great time. I'm happy." And I still remember Daniel, like, staring into my eyes with his s- cold, scanning, ebbing eyes, and he said, "Dara, since when is life about happiness? It's about impact. It's about impact, and you can have an impact on Uber, and Uber's a truly important company in our society." And for me, hearing that really flipped a switch. Uh, and by the way, I do wanna be happy, and I think happiness is, is important, but everyone that I talk to, all of our employees who are here at Uber are here because we can have an impact because they believe, and we believe very much that Uber is a different technology company, that the tech that we build shows up in the real world. You know, we got five million earners earning on our platform. The impact that we can have as a company is enormous, and I was lucky enough as an individual to be in a position to come in and have a big impact on the company, uh, as well. I always tell people, "When you think about your career, think about three things. Whom are you gonna work with? Do you like them? Can you learn from them? Can you have an impact at the company that you're going to? And does the company itself have an impact on the world? If you can check all three, then don't hesitate." And after I thought about it, after that initial moment of, "Oh my God, why would I do this?" I was like, "Yeah, this is really cool. I can make a difference, and it's an important company." So, so I jumped at the opportunity.

   6. HSHarry Stebbings5:47

      I think when you have such a big transition, you learn about yourself in many ways. What did you learn about yourself as a leader, as a person when making the transition from Expedia to Uber?

   7. DKDara Khosrowshahi5:58

      You know, Hari, honestly, I haven't had time to think about that. I'm not-

   8. HSHarry Stebbings6:03

      (laughs)

   9. DKDara Khosrowshahi6:03

      ... particularly introspective, and it may be a strength and may be a weakness. Um-I'm here to do a job. Uh, I love it. A friend of mine was asking me, "Are you having fun?" I'm like, "No, I'm not having fun. It's too hard. But I love what I'm doing." But we're mid-path, you know? And, uh, maybe in another five years, I'll have time to think and learn and kinda be introspective about what I learned about myself. Right now, I'm just learning about the company, about the opportunity and, and just going, just going as hard and fast as I can.

   10. HSHarry Stebbings6:34

       Speaking of going as hard and fast

3. 6:36 – 10:45

   How do you define high performance in leadership?

   1. HSHarry Stebbings6:36

      as you can, how do you define high performance in leadership? You said about kind of leaving nothing on the field before.

   2. DKDara Khosrowshahi6:42

      Well, I think ultimately in leadership, high performance is about throughput and output. It's like, no excuses, what are the results? And for me, when I think about performance at a senior leadership level, for me, it's sustained results. Like, there's no glory that's short-term glory. If you think about the best CEOs in the world, Jeff Bezos, or you know, even Elon Musk or Jamie Dimon, their greatness has taken time. So for me, I'm not looking for that bullet high performance in a particular quarter any year, but to me, high performance is sustained excellence over a long period of time. One thing that really stuck with me is that the hallmark of a great CEO isn't necessarily how the company did while the CEO was there, but also how the company performed after the CEO left. And so for me, putting a great team together and then sustaining performance over multiple, multiple years in the end is what defines high performance.

   3. HSHarry Stebbings7:43

      Can I ask, uh, it's, it's almost a little bit like investing. Obviously, I'm an investor and, you know, it's sustained over long periods of time with portfolios and duration. A lot of that time people can think you're wrong or crazy in a lot of ways. What do you tell yourself... And I have this a lot, um, in the case of Pakistan, I was just crazy. Um, but (laughs) but what do you tell yourself when actually you have that criticism, but you believe that you're being patiently right?

   4. DKDara Khosrowshahi8:10

      I think you have to have the heart to stick it out as a leader, and you have to be willing to be misunderstood for long periods of time. Otherwise, it's difficult to lead. I still remember a discussion I had with my former mentor, Barry Diller, my former boss, and, and I was having trouble a little bit because I fundamentally disagreed with the decision that the team was making. And Barry said, "Listen, I didn't bring you here to be average." And so if you're agreeing with your team and you're doing what is obvious, then essentially you're going to perform in an average way. Your output will be average. As a leader, you have to be willing to kind of bust out of the obvious, do something non-obvious, different, surprising, and then stick to that decision; obviously live with the consequences of that decision. So I'm quite comfortable with going against the grain. Like, if I'm not going against the grain, then I don't think I'm doing my job and I, and I think I'm missing something. The minute that the whole market believes in one trend, that's when I think to myself, there's something wrong here. There's, there's group kind of thing going on. How can I either avoid group think or how can I take advantage of it? What's the opportunity here for me? So I'm just... I, actually, if I agree with everyone, it makes me distinctly uncomfortable.

   5. HSHarry Stebbings9:31

      Speaking of that kind of, uh, discomfort with going with the crowd, would you say that you're a wartime CEO? Would you say that's your natural preference?

   6. DKDara Khosrowshahi9:41

      I think, you know, Expedia was... It- it was, I was at Expedia 13 years, and it did feel like wartime. It was a big turnaround, and turnarounds in business are difficult. Turnarounds in technology are harder. And for example, with Expedia, we had to undergo a giant re-platforming of the whole technical platform. So you had to keep the business going and then rebuild the technical platform, which was pretty tough. Now, it was wartime, not in the public eye, uh, and then Uber definitely has, has been wartime. Like, it's, it's, it's, uh, wartime every day. Although, although I think we're, we're really getting a handle on the business, and I'd say we're winning, but I do feel comfortable in difficult situations. I don't take setbacks too seriously. I just keep pushing. So am I comfortable in wartime? Reasonably.

   7. HSHarry Stebbings10:34

      I had Tobi from Shopify on the show the other day, and in his brilliantly kind of Germanic and disciplined way, he said to me, "Hari, the best businesses, they have constraints." Uh,

4. 10:45 – 13:48

   What constraints does Uber have?

   1. HSHarry Stebbings10:45

      I'm clearly a impersonator for a second job.

   2. DKDara Khosrowshahi10:47

      (laughs) .

   3. HSHarry Stebbings10:47

      Um, uh, when you think about the constraints on Uber, what do you think are the natural constraints? And are there any artificial constraints you place on the business or the team?

   4. DKDara Khosrowshahi10:57

      Uh, tons of constraints, and, and I think it, it's what makes the business interesting. I think the first constraint that comes up is that we are a marketplace business. So our supply and demand is variable, but it is variable on a real-time basis, spatially time-based, et cetera. Uh, and that variability and, uh, predictability make it very challenging to kind of make the marketplace work, so to speak. So the natural constraint, we talk, for example, at Uber about being customer-obsessed. But the thing is, you know, we have multiple customers. So actually a value of the company is being trip obsessed. The magic happens when you match supply and demand, you bring that rider and driver together, or you bring that eater together with a restaurant with a courier and that magical match happens. And that magical match can happen only when it's on a basis that makes all two or three parties happy. That's a very interesting business challenge. And so for us, for example, our value is being trip obsessed. It's about what do you have to orchestrate to bring together that connection on a real-time basis? Now, in this last quarter, two billion times a quarter. That to me is a super interesting constraint.And then related to that is what I talked about earlier, which is the impact that Uber has on the real world. You know, we are an incredibly important entity in terms of transportation in cities, in terms of earning power for over five million earners. That's a responsibility that we have to take super seriously. It's a responsibility that, like, we've gotta really hold dear and act accordingly. It sometimes slows us down, it sometimes changes decision-making, but I think ultimately it helps us do the right thing and make the right long-term calls versus let's say short-term call that might be good for us, but not good for our ecosystem, so to speak.

   5. HSHarry Stebbings12:53

      And speaking of making the right short-term versus long-term call and, and how to balance it, often is, uh, the, the best CEOs are the best capital allocators. Do you agree with that statement?

   6. DKDara Khosrowshahi13:04

      I think from a long-term basis, yes. You know, from a short-term basis, you've got to earn the right to invest your capital. Uh, so if, if you insert capital with resource allocator, I absolutely agree with that, right? It's up to you to decide, uh, where to allocate your resources, where to make bets, where to pull back, et cetera. And then tactically, you've got to earn the right to then allocate capital over the long term. So, uh, over a 10, 15-year period, capital allocation becomes really important, but tactical resource allocation and finding the right team to actually execute on those plans, that, I think, short-term, is incredibly important, and you gotta take care of the short-term to earn your... to earn

5. 13:48 – 17:05

   Best and Worst Product Decisions

   1. DKDara Khosrowshahi13:48

      the long-term, so to speak.

   2. HSHarry Stebbings13:49

      When you think about capital allocation decisions today and what you've made today at Uber, where were you like, "Yes, we nailed it there and actually we were right," and where were you like, "In hindsight, maybe we shouldn't have done that"?

   3. DKDara Khosrowshahi14:01

      I think where we are very good at Uber and we spend a good amount of resources and capital, if you wanna call, all that, is in our marketplace tech. We have a very talented large marketplace team that is constantly training these ML algorithms to balance supply and demand on a temporal and, and geographic manner. That is a... I think we've got the biggest team there. I know we have the most capable team there, and that has been a bet that we've made that has really resulted in significant returns. You know, where we got it wrong was when we went outside of our core. So, for example, we had a very large self-driving business, ATG, trying to develop autonomous tech, and that wasn't what we were passionate about every day, and it was outside of the core, and ultimately, that was capital allocation that, you know, we should... that was capital that we shouldn't have been allocating. You know, another example might be, um, bikes and scooters. You know, hardware business, we have a investment now in Lime which is succeeding that, but it's the only thing that they are doing, they're passionate about every single day. We are, you know, a network company. We connect supply and demand. We're not particularly good in hardware, and I think our investment or the capital that we allocated in hardware in the past was a mistake.

   4. HSHarry Stebbings15:24

      How do you think, though, about focus and prioritization? 'Cause li- I totally understand that, but almost defending you, you can't just focus on the core and what's working today, and you have to have an eye for the future in alternative markets and products. So, how do you think about, as a leader, like, that decision between focus on the core today and then adjacent products and future innovation?

   5. DKDara Khosrowshahi15:44

      Well, I think that's... And, and by the way, you always want to be expanding the core, so to speak, right?

   6. HSHarry Stebbings15:50

      Yeah.

   7. DKDara Khosrowshahi15:51

      The, the investments of tomorrow then defines where the core is gonna be five years from now. And so for us, those future investments are in places where we believe we have a core skill set or an advantage or a right to win. We built our Uber Eats business essentially organically from our rides business. There are very few companies that have built up organically a second business just as large as, as the base business. And then the Uber Freight business as well, uh, the vast majority of growth there has been organic, and it's because it went to the core of our understanding how to match supply and demand in a real-time basis in a particular city. The extension of that was Uber Eats into a three-sided marketplace, which is eater, restaurant, courier. And then with freight, you know, just like in the olden days when you had to hail a taxi, you had to call a dispatcher, people are still doing that in freight, so we're digitizing that connection as well. Eats and freight are now core, but at the time, they were projects that were outside of core, but they utilized a skill set where, where it was a core skill set that we had, and as a, as a result, they succeeded.

6. 17:05 – 21:11

   Uber Eats vs DoorDash

   1. DKDara Khosrowshahi17:06

   2. HSHarry Stebbings17:06

      I wasn't sure whether to ask this, but it was from a friend of yours, and so I thought I could, but they did ask to remain anonymous, so, I mean, they clearly just terrified.

   3. DKDara Khosrowshahi17:16

      Uh-oh. This is gonna be good.

   4. HSHarry Stebbings17:16

      Um, so when you mentioned Uber Eats there, and, um, again, I'm not a journalist, and so this is very un-British of me and very unlike me, but your friend asked, "Uber Eats, why does Dara think you lost the lead to DoorDash, and what would you do differently?"

   5. DKDara Khosrowshahi17:31

      Well, I think the first thing that I would tell my anonymous friend, uh, is that we haven't lost the lead. Uber Eats is actually as big as DoorDash on a global basis. And so when we think about Uber, we think globally, right? And we are the global leader along with DoorDash, who are a very, very good company. Uh, and ultimately, I think we could be more profitable because of the platform that we have, because of the, of the breadth that we have in terms of rides and, and eats coming together. Now, that said, in the US, we made a bet on, on speed, and we made a bet in the urban centers, right? This is Uber. We grew up in the big cities, and so the natural extension of Uber Eats was in the big cities. And the magic of Uber was push a button and the car shows up in five minutes, and so we made a bet on...... the fastest delivery possible. As it turns out, DoorDash made a bet in the suburbs. They went to where the market was, and the suburban markets have proven to be much, much, uh, larger than I think people expected early on. Kudos to them. And they also made a bet on selection, which is the number of restaurants, right? Selection and speed are, to some extent, inversely correlated. If I reduce the radii and I get you a delivery in 15 minutes, I probably can't show you as many restaurants as if I allowed, let's say, 30 or 45 minutes. So, I think the biases that we had, which is coming from an urban rides business that was all about the five-minute ETA, made us early on bet on the wrong thing. We've since corrected, and we've got, you know, huge selection in the markets in which we operate, and where we learn our business, especially in those international markets. You know, DoorDash and some of the competitors are having a very, very tough time, and we are, you know, the number one player at the vast majority of th- of those markets. So, sometimes you win, sometimes you lose. The global game, I think we're winning, and we've learned our lessons locally in the US, and we're... and, and we're gonna operate accordingly.

   6. HSHarry Stebbings19:33

      So, just so I understand, so that means then you actually think about increasing selection and then increasing delivery time? Because you spoke about the inverse correlation there. Is that the lesson you take away?

   7. DKDara Khosrowshahi19:44

      Yeah. I thi- I think in addition to suburbs versus, versus urban, so we're going after the sub- suburban markets. But what we found is that as long as you're accurate in the prediction of the delivery time, as long as you let the person know, "Harry, that your delivery's gonna come in 35 minutes," if it gets to you in 35 or 40 minutes, most people are fine with that, because then they can plan accordingly. And so the trade-off of, hey, should I give you 100 restaurants in 25 minutes or 200 restaurants in 35 minutes with a predictable ETA? The latter wins. And that has definitely been a, uh, a lesson for us.

   8. HSHarry Stebbings20:26

      What's the best market for Uber Eats?

   9. DKDara Khosrowshahi20:30

      The be- well, the biggest market is still the US, but I'd say the best market is probably Australia or France. I'd say it's a toss-up between those two.

   10. HSHarry Stebbings20:39

       How-

   11. DKDara Khosrowshahi20:39

       Although I think Taiwan would, uh, uh, would object too. So call it Australia, France, and Taiwan are all terrific markets for us. Overall for Uber, I'd say Australia is, is the best market. We are very, very strong both on mobility and on delivery. We've introduced a membership program, Uber One, where you can get a discount on both. And those two services together, especially in Australia, uh, are doing very well. If the, if the world looked, looked like Australia, uh, it wou- it would be a real home run for us at, at Uber.

7. 21:11 – 25:03

   Uber Acquisitions: Careem, Postmates & More

   1. DKDara Khosrowshahi21:11

   2. HSHarry Stebbings21:11

      I do have to ask you, you mentioned kind of the globalization. Y- you acquired Careem. W- talk to me about the decision-making process there, and... And another anonymous friend. In hindsight, are you happy you made the acquisition?

   3. DKDara Khosrowshahi21:23

      Yeah, very happy. I mean, for, for me, it was a bet on, um, Mudassar and Magnus, who were the founders at Careem, and they're still with the company. They're incredibly talented entrepreneurs. And Careem, actually, early on, was looking to build a mobility business, delivery business, and a payments business in the Middle East. Uh, the Middle East, it's... The demographics in the Middle East are great demographics. It's a young demo coming online, and the bet that Careem was making in this platform, uh, building out a mobility, delivery, and payments business, was something that we can learn from. And the Middle Eastern business, for us, has been enormously successful, and Careem is absolutely part of that success.

   4. HSHarry Stebbings22:08

      Wow. That's awesome. Um, I... Mudassar is amazing. Um, tell me, Postmates, the other one. That was an odd one, Dara. (laughs)

   5. DKDara Khosrowshahi22:17

      (laughs)

   6. HSHarry Stebbings22:17

      I mean, I w- I wasn't expecting that. I was, I was quite envious of the venture investors who were in it, um, but I wasn't expecting it. Talk to me about that one.

   7. DKDara Khosrowshahi22:25

      That was really about consolidation of the delivery space in the US. Postmates had a very strong position on the West Coast, especially in LA.

   8. HSHarry Stebbings22:36

      Ah.

   9. DKDara Khosrowshahi22:36

      Super attractive market for us. So we wanted to scale faster in that market, and we did so, and then we went after very fast integration. So, while Postmates as an app is still in the App Store, they've got, uh, millions of loyal customers, all of the backend is essentially being served by our infrastructure, which allowed us to save pretty aggressively as it related to the cost side. So, it worked out in the end, but it wasn't about kind of new capability, as Careem was. It was really about the go-go days of delivery, ultimate market size, and our getting access and building out our West Coast selection especially.

   10. HSHarry Stebbings23:17

       If it's like end of term and we have report card in, you've got children, which one are you like, "A star, Dara nailed it, and this was my best acquisition"?

   11. DKDara Khosrowshahi23:28

       I would say probably Careem or there's a... we're pretty early on in terms of development, but a- an acquisition that we made in... with Uber Freight, Transplace-

   12. HSHarry Stebbings23:40

       Mm-hmm.

   13. DKDara Khosrowshahi23:41

       ... which really runs the logistics, outsource logistics function of, of a lot of companies out there. Both of those, I think, are either hits already or are gonna turn out to be big hits.

   14. HSHarry Stebbings23:53

       On the flip side, which ones are you like, "Oh, Dara, pass me the tequila"?

   15. DKDara Khosrowshahi23:59

       (laughs)

   16. HSHarry Stebbings23:59

       (laughs)

   17. DKDara Khosrowshahi24:00

       Um, you know, there was a company called Chump that we bought which was electric bikes, and it just didn't work out. We just sucked at hardware. And it was-

   18. HSHarry Stebbings24:10

       (laughs)

   19. DKDara Khosrowshahi24:10

       It's just not... You know, software people, you're iterating, you're building incredibly quickly, and then you're like, "We're gonna teach these hardware people how to move fast." And then, there's a reason why hardware is so difficult. There's a reason, you know, you screw up your firmware, you don't get your h- you know, just everything has to come together in terms of...... both the hardware and the software, you're dealing with shipping issues, manufacturing issues. It's just a whole lot more difficult than it looks. Uh, so we bit off more than we could chew on that one.

   20. HSHarry Stebbings24:41

       That is so fricking hard. Whenever I get harped by companies, I'm like, "Ah, peace out." Like, "I prefer consumer social than this." Um-

   21. DKDara Khosrowshahi24:48

       I- I have, I have developed a healthy respect for companies like Apple or even the, you know, Tesla. It, it's actually amazing building a scale software/hardware business from the ground up. It, it's an extraordinary accomplishment.

8. 25:03 – 29:03

   How to Encourage a Culture of Risk Taking

   1. DKDara Khosrowshahi25:03

   2. HSHarry Stebbings25:04

      Can I ask, how do you keep a plastic mind? And what I mean by that is, like, you know, in business or in investing, you make mistakes, and it's very easy to let that plague your future decision-making process. "Oh, well, never do anything in hardware again." Well, that might be wrong, and it might be a good thing for Uber to do something in five years, 10 years. Who knows? Um, how do you keep a plastic mind with each new decision?

   3. DKDara Khosrowshahi25:28

      Well, I think that if you're not making mistakes, then you're not doing your job, you're not taking risks. You know, like, if I didn't wanna make mistakes, I'd, I'd be a treasury bond manager, right? Like, my job is to make (laughs) mistakes and learn from them. So, like, I, uh, I don't mind when people make mistakes. What I, what I, what I mind is if they're not self-reflective. First of all, they don't recognize it, and they don't make excuses, right? The, the problem with... Excuses suck anyway, but the problem with excuses is you're not learning, right? So face up to the mistake, identify early, take responsibility, learn from it, and then help that shape who you are go- going forward, and that who you are, hopefully, is a little bit better. And the same applies to companies. Like, we absolutely should be making mistakes. If we're not making mistakes, we're playing it too safe. We're not... We're, you know, we're, we're not growing. Like, that, that's, that is part of being an organism. So I'd say, for me, I don't mind make- making mistakes. I just, I just wanna... It's you'll fail fast. Um, there are some decisions where you really have to take your time, right? So decisions that it's the old one-way door, two-way doors. The key is, uh, identifying two-way doors, moving fast through them, and then taking your time on the one-way doors to make that considered decision. And maybe it comes back to something that we started with, which is I don't like moving with the herd, so that, again, makes me a little bit willing to make mistakes. And, and actually, you're absolutely right, which is we failed in hardware, but, uh, I, I always wanna keep my mind open, eyes open, see what's going on, be curious, because there's probably a reason why we failed, and maybe the next time, we can do better. I will tell you right now, based on everything I see, we're gonna stay squarely in software 'cause we're really, really good at it.

   4. HSHarry Stebbings27:27

      Do you think Wall Street appreciates that willingness to make mistakes and learn? Wall Street is unforgiving, and it doesn't have that iterative mindset, generally speaking. Do you, do you think that's fair?

   5. DKDara Khosrowshahi27:39

      I think that's fair. Uh, the translation layer to that decision-making by Wall Street is the financials that you report on a quarterly basis. Does it make sense on a theoretical basis to have more volatility but, uh, but more growth? That does make sense on a theoretical basis. But capital allocators hate uncertainty, right? And so, the demand of Wall Street is predictable earnings, tell me what you're gonna do, and then do an inch better than, than what you were gonna do. And that's just the game that then you have to either be comfortable with or not comfortable with, but if you wanna play that game, you gotta play that game effectively. So I think as it relates to mistakes is we always go in with a cushion, and so we... That there's... I, I guess what you... The way I put it is there's a budget of mistakes that I can make, and I can't kinda overspend on my mistake budget. Uh, and as long as I'm staying within my mistake budget, I'm doing well. And by the way, if I'm not spending my mistake budget, then probably I'm not learning enough. I- I'm not going fast enough. It's that balance that you gotta figure out, and, and it's part of the art of being a public company. Some parts of it suck, but some parts of it are really fun.

   6. HSHarry Stebbings28:55

      So you're n- not gonna buy my hardware startup? Is that, is that what you're saying? I don't-

   7. DKDara Khosrowshahi28:59

      Not tomorrow, at least.

   8. HSHarry Stebbings29:00

      All right.

   9. DKDara Khosrowshahi29:00

      But, you know, send me the pitch, Harry. I'll take a look. I'll take

9. 29:03 – 34:40

   One Way vs Two Way Door Decisions

   1. DKDara Khosrowshahi29:03

      a look at anything.

   2. HSHarry Stebbings29:03

      (laughs) You, you, you mentioned the one-way door, two-way door there. My only pushback would be... Or not even pushback, but I had the, uh, amazing CMO from Facebook, Alex Schultz, on the show recently. He said, "Actually, there are so, so few decisions that are actually one-way door." Like, all acquisitions are kind of two-way doors. It's okay. What's a one-way door, do you think?

   3. DKDara Khosrowshahi29:25

      I think one-way doors e- either big mistakes, right? So if you make a big acquisition, then that can be fatal for you, right? So size matters (laughs) in this c- in this case. I think a second one is, what's the blast radius of the mistake? Does it affect third parties? And what's the appetite for those third parties to recover, let's say, from, from that mistake? An example that, that I'll give you is we've actually slowed down in terms of some of the velocity of features that we ship for our earners, right? So it's, we're iterating constantly as it relates to, to eaters, riders, et cetera, uh, trying X out or trying Y out. But as it relates to earners, this is how they're making a living. This is how they're earning, and we've gotta be more careful in terms of earner-facing innovation because of the possibility of making a mistake. And a mistake for an earner is, A, they didn't get the... They didn't get paid the way that they thought they were gonna get paid.... or you've, you've changed something about your pricing or routing algorithms, and many earners, you know, they're on the platform 20 hours a week, 40 hours a week. So, the blast radius, the consequences of those, uh, of the mistake, uh, is bigger, uh, and there are third parties that you really have to take care of. These earners are incredibly valuable, uh, to us. So, that, you know... Is it a two-way door? Sure it is. But there's a lot of friction in, in going back, which makes you more careful, uh, and caring in how you build in those circumstances.

   4. HSHarry Stebbings31:11

      Kass, when you have those one-way-door decisions, you know, you sit on your own as CEO, but very often there's a person that one calls. You know, I have, I have someone, (laughs) uh, when times are really hard, uh, and they know if I... When they get the call from me it's like, "Oh, fuck." Um, uh, (laughs) . Uh, who do you call when you have those one-way-door decisions?

   5. DKDara Khosrowshahi31:32

      You know, I'm lucky enough actually to have someone that I don't have to call, which is my wife. I just talked to her. Uh, she really helps me out in thinking about issues. I mean, definitely people issues. I've made it a rule if I hire someone, uh, I'm, I'm always gonna have her, uh, meet this person 'cause she's an incredible judge of people, and then actually on business issues.

   6. HSHarry Stebbings31:54

      What, what do you, what do you think, what do you, what do you think makes her an incredible judge of people? Is it something where I'd suck?

   7. DKDara Khosrowshahi31:59

      I love people in general, and I'm always going to look at your best side. She takes a much more judgmental (laughs) view of people, and she's got a very high bar for her, you know, people that she engages with. She just, like, is able to call bullshit in 0.1 seconds. And so, I think let, them, actually, uh, I like people. Like, I want to like you, I want to believe in you, I want us to do something really cool together. That's my natural bent, and so she really helps me. And she's, she can be critical. She's sometimes critical of me and herself as well. But we're, we're great partners, and, and even on business stuff. Like, I talk through business issues with her, and, and listen, if, if you can't explain simply, de- deep business issues or even deep tactical issues. Like, one of the things that I, that I always look for in terms of engineering and technical talent is, I'll ask them questions, and if there, th- there are some of them that try to use their technical talent for, like, to lord over you, as power, uh, over you. They, they, they demonstrate to you how much smarter they are than you, and then there's a different kind of person who explains things simply. They want you to understand. They wanna share their knowledge. That latter kind of technical talent is a kind of technical talent that I'm looking for, which is like, tell me why, tell me how this works. If they are able to simply explain, uh, a deep technical problem, then they've got clarity of thought and they're generous in terms of their information sharing, which is something that I'm looking for. So, most of the time I talk to Sid, she helps me out, uh, and, you know, I, I talk to my chairman, uh, Ron Sugar, Barry Diller, a couple of other folks as well. But I'd say my, my top advisor is, uh, is my wife.

   8. HSHarry Stebbings33:46

      At least you've got some brownie points for that one. Uh-

   9. DKDara Khosrowshahi33:48

      (laughs)

   10. HSHarry Stebbings33:49

       ... uh, can I ask... My question to you is, you mentioned there about kind of trust in the team, do you start with full trust and it's there to be lost, or do you start with no trust and it's there to be gained, and how would you advise on that?

   11. DKDara Khosrowshahi34:01

       I start with full trust, and hopefully you can deserve that trust. I mean, I, I give a good amount of autonomy to my team, and then I hold them accountable. And again, accountability doesn't mean don't make mistakes, but it means moving fast and taking responsibility for those mistakes, and then learning and iterating and getting better every single day.

   12. HSHarry Stebbings34:23

       Do you ever lose your shit, Dara? I do.

   13. DKDara Khosrowshahi34:26

       I don't lose my shit. Uh, I'm pretty calm, so I, uh... My, my wife calls me a robot. I'm, I'm pretty level-headed and it's helped me in life sometimes. Sometimes to fault. So, I don't lose my shit, but I'll get pissed off once

10. 34:40 – 39:56

    Secrets to Marriage and Parenting

    1. DKDara Khosrowshahi34:40

       in a while.

    2. HSHarry Stebbings34:41

       Uh, you, you mention your wife many times. Uh, I, I... This is something that I'm looking to learn over time. Um, what's the secret to a great marriage, do you think?

    3. DKDara Khosrowshahi34:50

       First of all, I'd say every marriage is different. But what really works for Sid and me is that we're in love, but we're in like. Like, we like each other a lot. We hang out together, we laugh, and I've found... I've seen lots of couples who are in love, but they don't, they don't like hanging out as much. You know, the husband will go play golf on the weekend. I'm like, "No, I wanna spend time with my family (laughs) on the weekend." So, I think the secret, for us at least, is that we like each other, we like each other a lot.

    4. HSHarry Stebbings35:21

       You mentioned family there. I also think bonding and parenting is one of the greatest joys in life. What does being a great father mean to you, Dar?

    5. DKDara Khosrowshahi35:29

       Oh, I'm still figuring that out. Um...

    6. HSHarry Stebbings35:31

       (laughs) The CEO shit's easy.

    7. DKDara Khosrowshahi35:33

       Yeah, exactly, exactly. Doesn't run much.

    8. NANarrator35:35

       (laughs)

    9. DKDara Khosrowshahi35:35

       These are tough questions that you can't iterate with kids 'cause, uh, it's a giant one-way door. Um...

    10. HSHarry Stebbings35:42

        (laughs)

    11. DKDara Khosrowshahi35:42

        Uh, I, I, I'd say for me, it is to be engaged. One, one of the things that is really important to me is, when I'm at work I'm all in at work. When I'm with my family, I'm all in with my family. And I think when you do things halfway, you do it really poorly, and that is true in business and, and it's true in your personal life. So, when I'm with my kids, I'm with them, and we have a great time, and I think that shows. That engagement with them shows. Uh, I push 'em hard. It's not like I'm, I am, I'm easy all the time. But when I'm with them, I, uh, I'm with them 100%.

    12. HSHarry Stebbings36:22

        Do you think we've all got a bit soft? We all kind of talk about the work/life balance. I'm with you on being all in and the importance of it, hence my very single status permanently. Um, like...Do you think we've got a bit soft? And i- is that a bit hard for you as a leader, to say where you actually can't really say very (laughs) much about that, even though you think it? (laughs)

    13. DKDara Khosrowshahi36:41

        Uh, uh, uh, I, I think... You mean generally, societally, have we become a bit softer, or have we become-

    14. HSHarry Stebbings36:45

        I'm saying the entitlement of a generation, which is like, "Oh, I w-" you know, "I wanna have kombucha, and I wanna have that offsite retreat, and I want the yoga in the mornings, but I also wanna be paid really well, and I want that big equity grant," and, you know-

    15. DKDara Khosrowshahi36:56

        (laughs)

    16. HSHarry Stebbings36:56

        ... blah, blah, blah. And you're like... And then, and then, you know, my favorite thing is they go, "And this is the first generation, we don't have as good a living standard as our parents." And you're like, "Are you fucking kidding me? Your parents didn't have Uber Eats delivered to their door every night." (laughs) Like, what? But sorry, no.

    17. DKDara Khosrowshahi37:11

        But Harry, tell me what you really think. Uh, no-

    18. HSHarry Stebbings37:14

        (laughs)

    19. DKDara Khosrowshahi37:14

        ... it, it's l- listen, I, I agree. I, I think that... I, I, I'll start with parenting, which is, I was actually much too soft with my kids as a, as a parent, and it wasn't doing them any favors. That is one thing that I learned fr- from Sid is like, if, if, if you're protecting your kids from adversity is not doing them any favors, because the real world, you know, is, can be really difficult. And I think the same applies with, with our generation, which is, have we gotten too soft? Yeah, of course we've gone too soft. I mean, it, it, it's about adversity, it's, it's about discomfort, uh, making mistakes. All of these things are gonna shape you going forward. Um, you know, I, I, I-

    20. HSHarry Stebbings37:59

        Usually when you complain out of the needed

    21. NANarrator37:59

        Yeah.

    22. DKDara Khosrowshahi37:59

        ... I think it's easy to generalize in terms of have we become too soft, but I like the people that we see at Uber, and, um, I think they're capable, they work hard, they rally to, to their occasions. But, you know, sometimes I do feel like the old crummy guy who's, uh, who's criticizing the, the new generation. Uh, I think they'll be fine.

    23. HSHarry Stebbings38:19

        I'm very comfortable being that guy. Don't worry. After that rant, trust me, I'm the one who looks back.

    24. DKDara Khosrowshahi38:23

        Harry, I have good news for you.

    25. HSHarry Stebbings38:25

        (laughs)

    26. DKDara Khosrowshahi38:25

        You are the new generation.

    27. HSHarry Stebbings38:27

        Oh, I'm not anymore, Dara. No, no, no. I'm, I'm, I'm 26 these days. There's, like, 21-year-old founders that, that, you know, thoroughly think I'm old. So I, I can embrace-

    28. DKDara Khosrowshahi38:35

        Harry, if you, if, if you think you're old then I'm dead.

    29. HSHarry Stebbings38:38

        (laughs) That's gotta be the title for the show. (laughs) Dara, if you think I'm old, then I'm dead. Uh, kidding, bleh.

    30. DKDara Khosrowshahi38:47

        Harry, if, if, if you think you're old-
11. 39:56 – 41:35

    Old Guard vs New Guard

    1. DKDara Khosrowshahi39:56

    2. HSHarry Stebbings39:56

       Final one before we do a quick fire. Was it hard in terms of, like... Naturally with any change of, you know, leadership, there are kind of the old guard-

    3. DKDara Khosrowshahi40:06

       Yeah.

    4. HSHarry Stebbings40:06

       ... and there is the newer team. Is that tough making that transition a- elegantly, but also, if you don't like it, you know, walk off?

    5. DKDara Khosrowshahi40:14

       Yeah, definitely. And, and, and the cool thing about Uber is, I think we're, we're now a combination of call it the old guard and the new team, and, and it's become kind of a new new team. There's, there's really no difference. But literally, there's, you know, a ton of my directs who were here way before me, and then some newer managers that, that we brought in. And I think actually, in hindsight, the pandemic, like, a shared giant crisis really brought us together, uh, as a team. But at the time, it was difficult because part of my job was to communicate and, and then act accordingly in a very clear way a delineation between what we call Uber 2.0 versus Uber 1.0. So, I had to very publicly talk about how, uh, we were different and how we were changing, we were changing our culture, it's about doing the right thing. Uh, and I do think that was difficult for some of the old guard, because not everything about old Uber was bad. Like, there were... It was incredibly c- entrepreneurial str- uh, uh, entrepreneurial company, innovative, very high bar for talent, et cetera. So, I think that that natural conflict was challenging. Ultimately now, I think we've come together as a company. And old guard, new guard,

12. 41:35 – 42:17

    Quick Fire Round

    1. DKDara Khosrowshahi41:35

       you know, who cares?

    2. HSHarry Stebbings41:36

       I wanna do a quick fire round, Dara.

    3. DKDara Khosrowshahi41:37

       Sure.

    4. HSHarry Stebbings41:37

       So, I say a short statement, you give me your immediate thoughts. So, uh, tell me, what's the favorite book and why?

    5. DKDara Khosrowshahi41:44

       Favorite book? God. Um, I'd probably say favorite book is Isaac Asimov's Foundations, just because it got me into sci-fi and my passion around science and engineering. It, it really had an impact on me. I was a kid just here from Iran, and it, it just captured my imagination. A more recent book that I read that w- that really was great was Splendid and Vile. It's about, um, Churchill during the Battle of Britain. Uh, one extraordinary person, and, and he, he really lifted that nation up on his back.

13. 42:17 – 46:18

    Travis Kalanick

    1. DKDara Khosrowshahi42:17

       Uh, it, it was absolutely delightful book.

    2. HSHarry Stebbings42:20

       (laughs) What was the best and the worst thing you inherited from Travis?

    3. DKDara Khosrowshahi42:26

       Best thing I'd say is, uh, is a bar for talent. Travis went after incredibly talented people, and, uh, and I got to keep some of them, which is great.Uh, worst thing I, I think, it was just the brand damage as it related to Uber the enterprise. You know, people still love the brand itself and the utility of the brand, but it, it's taken a while for us to rebuild, um, and, and rebuild public sentiment. Uh, and, and, you know, that was tough. But I'll take the trade. I'll, I'll, I'll take the, I'll take the talent, because the talent has helped us rebuild.

    4. HSHarry Stebbings43:03

       Do you guys hang out? Do you guys like do brewskis together? You know, a little high five?

    5. DKDara Khosrowshahi43:07

       No, we don't hang out. He's in, he's in, uh, LA now. But we talk every once in a while. He, he has a, he's built a dark kitchen company that we do work with.

    6. HSHarry Stebbings43:17

       Yeah.

    7. DKDara Khosrowshahi43:17

       And I think it's the biggest, uh, dark kitchen company out there. So if, if anyone succeeds in that, in that area, I think it'll be Travis.

    8. HSHarry Stebbings43:25

       How did Barry Diller influence you as a leader? What a hero.

    9. DKDara Khosrowshahi43:29

       Oh, uh, in every way. In every way. He's, he's been my... I, I worked for him for over 20 years. Uh, I think that I'm here because of him, because of the shots that he took, because he... the opportunities that he gave me. Uh, and, and, and I think what's extraordinary about Barry is despite all of his accomplishments, he is still unbelievably curious. He, he has a thirst for knowledge that I have not seen, you know, never seen. But also, as, as you get older, you kind of think you figure it out. I think if, if he asks Barry, he's like, "I haven't figured anything out. I'm still going." Uh, and that curiosity and that drive is, is pretty extraordinary, and it's definitely shaped me.

    10. HSHarry Stebbings44:17

        What's the most painful lesson that you've been through and you're actually quite pleased to have been through because of the lessons?

    11. DKDara Khosrowshahi44:23

        I think the biggest one professionally has been the pandemic. You know, we lost, uh, 85% of our volume overnight, and the business was already losing $2 billion. It was a incredibly important moment for us, and we took some really tough medicine in terms of, uh, selling certain businesses, in terms of significant layoffs for the company. But I think it allowed us to come out lean and mean and focused, uh, allowed the Uber Eats business to really expand in an extraordinary way, and I think we're coming out of the pandemic much, much stronger than we were going in. And I think now, especially with tech companies cutting back on spend, et cetera, we learned our lesson of the pandemic, so I think on a relative basis, uh, we've been performing pretty darn well, both top line and bottom line, and we, and we, we've got to keep that going. But it was a, it was an ugly, tough lesson, but it was a, it was one that I think we've, we've learned from.

    12. HSHarry Stebbings45:20

        You can call Dara the night before your first day as CEO of Uber and give him some advice. What advice do you give him?

    13. DKDara Khosrowshahi45:28

        Go faster. Go faster. You know, it's just, um, in hindsight, I, I didn't know what I was getting into. I needed to meet everyone, I needed to get input, but I think that my decision-making could've been, uh, faster right up front.

    14. HSHarry Stebbings45:50

        It's hard. What's on your tombstone in terms of one word? So like mine is persistence, clearly.

    15. DKDara Khosrowshahi45:56

        Oh, God.

    16. HSHarry Stebbings45:56

        Uh.

    17. DKDara Khosrowshahi45:56

        I, I don't want a tombstone. I want like a big ass oak tree that people can, you know, sunbathe beneath and read a book. No, I'm not interested in a tombstone.

    18. HSHarry Stebbings46:05

        W- What, what was gonna be carved? What's, what's carved into it?

    19. DKDara Khosrowshahi46:06

        It-

    20. HSHarry Stebbings46:06

        A word that describes you best.

    21. DKDara Khosrowshahi46:09

        Um, survived.

    22. HSHarry Stebbings46:14

        (laughs) The paradox of that statement.

14. 46:18 – 48:44

    Uber in Five Years

    1. HSHarry Stebbings46:18

    2. DKDara Khosrowshahi46:18

       (laughs)

    3. HSHarry Stebbings46:18

       Um, penultimate one, uh, is, uh, where do you think Uber could be more efficient?

    4. DKDara Khosrowshahi46:23

       I, I think it's actually on the decision-making side. We... Ours is a complex business in that we're building tech that shows up in the real world, right?

    5. HSHarry Stebbings46:33

       Right.

    6. DKDara Khosrowshahi46:33

       You push a button and car shows up in five minutes, a hamburger shows up in, in half an hour. There's a lot that needs to happen to orchestrate all of that in an artful way without any mistakes. So, as we build product, you have to have a lot of input from product folks, tech folks, ops folks, legal folks, et cetera. And the... as a result, the decision-making sometimes isn't as clear, like who... we, we call it who owns, who owns the decision. Uh, and, and I think that's something that we can continue to improve on.

    7. HSHarry Stebbings47:07

       Final one for you, Dara. Next five years, so it's 2028. Where will we be then, and where will you be then?

    8. DKDara Khosrowshahi47:14

       Oh, I, I have no idea. Um, I'm not a planner, Harry. Like, I just... I, I, I feel like if I have too clear a sense of what's gonna happen in the next five years, I'm gonna ignore any input that disagrees with that picture, and I'm gonna be like getting, holding onto input that agrees with that picture. So, I actually very specifically... like, I'm very open-minded in what's happening in, in, in the l- in the next five years. Think about five years ago. Could you have ever predicted where we are now? Right? And, and so, predictions that are valuable, the obvious stuff you can predict, but the most valuable input is actually quite unobvious and very difficult to predict. And so, as opposed to trying to predict, I wanna be open. Like, I, I'm very humble, and I don't know what's gonna happen five years from now. But I wanna see signal, I wanna talk to everyone, I wanna read anything and everything I can so that I can see that signal sooner than anyone else, and I don't wanna have a bias, 'cause it's... if you're human, if you see signal that goes against your bias, you're gonna tend to ignore it at least the first couple of times unless it... un- until it becomes un-ignorable s- so to speak.

    9. HSHarry Stebbings48:31

       Dara, as I said, I can't thank you enough for this. I, I, I stalk the shit out of you. I know far, far too much-

    10. DKDara Khosrowshahi48:36

        (laughs)

    11. HSHarry Stebbings48:37

        ... about your family history and everything between now. But it's been such a joy, so thank you so much for joining me.

    12. DKDara Khosrowshahi48:42

        Thank you. It was really fun. Appreciate it.

Episode duration: 48:44