The Twenty Minute VCScott Gorlick: How Uber Acquired 1M Drivers & The Uber’s Expansion Playbook | E1196
EVERY SPOKEN WORD
80 min read · 16,307 words- 0:00 – 1:03
Intro
- SGScott Gorlick
When I got back to Atlanta to launch Uber, it was really about building the operation from scratch. You know, while most drivers hadn't heard of Uber and were a little bit skeptical, they were willing to give us a shot because it didn't cost them anything to join. And for the first two or three weeks of the city, dude, I was nervous. Zero out of 10 cars utilized, one out of 10, two out of 10. And then one Friday night, I was out. You know, I'm sitting next to some other guys that are in different cities and they're like, "It's gonna happen. It's gonna happen." And within, like, 10-minute span, we went from, like, two out of 10 cars utilized to, like, all 10 cars utilized and, like, 100 people opening the app. And it just totally flipped. And from that point forward, we just needed more cars.
- HSHarry Stebbings
Ready to go? (upbeat music plays) Scott, man, I am so excited for this. They- I said to you before, I'm a fanboy of your Twitter threads. I think they are fantastic. So first, thank you so much for joining me today, man.
- SGScott Gorlick
Thanks, Harry. Excited to be here.
- HSHarry Stebbings
Now, I would love to start just with a little bit of context before we dive into
- 1:03 – 3:56
Joining Uber & Launching in Atlanta
- HSHarry Stebbings
the incredible stories that are coming. Uh, tell me, how did you make your way into the world of growth to join Uber, I believe, as employee number 99?
- SGScott Gorlick
Harry, it's a crazy story. So I finished up school in 2011 and when I finished up school, there were really only two things that people did. They either went to investment banking or they went to consulting. I chose consulting. And very early on, I realized that it wasn't for me. Um, probably on like week three. But the silver lining of the experience was on the weekends, I could go out and fly to San Francisco, as long I was back- as long as I was back at the client site on Monday morning. So this was 2011, 2012 and, you know, I was going out and meeting companies like Airbnb and Square fairly early, along with like 50 other companies, but nothing really clicked, um, until I was in Chicago one night. I was trying to get to a work dinner and I was trying to find a taxi. It was raining. And I had heard about this app where if you press the button, you could get a ride. So I download the app and two minutes later, my first Uber showed up. It was an Escalade and I was immediately in love. Absolutely magical experience. So that night, uh, I was working on a deck pretty late at night, probably wrapped around midnight or 1:00 AM, and had this Jerry Maguire moment where I was like, "Huh, I need to be a part of this Uber thing. What's the most, like, simple thing to do?" So I decided to email travis@uber.com, not thinking that I would hear anything. And I got an email back and, you know, over the next few weeks, uh, I got to know the team. Eventually, uh, took an analytics test, took a creative test, and then flew out to meet the team probably a couple of weeks later. And because I was so young when I got in the room, I said, "Don't worry guys, I'm old enough." They seemed to think that was really funny. I was 23 and didn't know a- anything. But they sent me back to Atlanta to launch Uber's, uh, roughly 10th city as employee number 99.
- HSHarry Stebbings
So, I didn't know the context there when I asked that question. I did not know that it was like a direct cold email to Travis. That is, that is awesome. Um, that's also a lot of responsibility on the shoulders of a 23-year-old to open a city. How did you build in Atlanta then? You go back. Take me to that.
- SGScott Gorlick
Yeah, so it was an incredible experience. Uh, I was living in Atlanta at the same time, so I didn't really have to move. Um, but when I got back to Atlanta to launch Uber, it was really about building the operation from scratch. Um, when you're starting a marketplace, you really need to do two things. You need to get supply and you get- need to get demand. So for Uber, the hardest thing was the driver's side and we need to get a lot of drivers very quickly. So when we went into the initial market, we got a Yelp list of all the drivers, um, in the city and sort of like called through and tried to get them to sign up with Uber. And, you know, got our initial list of drivers that way and launched a few weeks later, um, with, uh, something we call a Rider 0.
- 3:56 – 16:28
Acquiring Drivers: Cold Calling, Referrals & Onboarding
- SGScott Gorlick
- HSHarry Stebbings
What did you say to them when you called them up? What did they say? What percent said yes? Just take me to that.
- SGScott Gorlick
Yeah. So I'd be like, "Hey, this is Scott. Um, I work at Uber in Atlanta. We're starting a new ride sharing service where, you know, you can pick up, uh, riders between your trips to the airport, um, and, you know, we help you fill your downtime. Um, is this something you might be interested in?" And, you know, while most drivers hadn't heard of Uber and were a little bit skeptical, they were willing to give us a shot because it didn't cost them anything to join, right? They would come to our office and, you know, we'd give them an iPhone, which is a story at some point. When we give them the iPhone, they'd be able to pick up a rider 20 minutes later, right? So we'd say, "Hey, if you don't like this, bring it back and no skin off our back."
- HSHarry Stebbings
Okay. So you call up, say, 100. What percent say yes?
- SGScott Gorlick
Probably like 75.
- HSHarry Stebbings
75% say yes?
- SGScott Gorlick
Yeah.
- HSHarry Stebbings
Okay, so we're onboarding our first 10, 20.
- SGScott Gorlick
Yeah.
- HSHarry Stebbings
Take me through the onboarding of the drivers. You fix supply and then demand just floods in the door? Just take me to that.
- SGScott Gorlick
Yeah, so we onboarded the drivers. They'd show up at the office. We do like a 60-minute onboarding. We check out their cars. We tell them a little bit about the company, and then we would kind of take them through the training on how to use the app. And then we put them out there, right? And for the first two or three weeks of the city, dude, I was nervous. Um, you know, it was zero out of 10 cars utilized, one out of 10, two out of 10. And then one Friday night I was out and I think I was actually out of town, um, at like an Uber-related summit and, you know, I'm sitting next to some other guys that are in different cities and they're like, "It's gonna happen. It's gonna happen." And within, like, 10-minute span, we went from, like, two out of 10 cars utilized to, like, all 10 cars utilized and, like, 100 people opening the app. And it just totally flipped. And from that point forward, we just needed more cars. It wasn't about the demand side. Yes, we had to do the partnerships. Yes, we had to do the BD and integrate ourselves in the community. But it was really about getting as many drivers on board as possible.
- HSHarry Stebbings
How did you retain the drivers when it was one out of 10, two out of 10? 'Cause the whole thing is like the symmetry of timing, making sure it's aligned.
- SGScott Gorlick
Yeah.
- HSHarry Stebbings
How did you keep them when there was nothing coming?
- SGScott Gorlick
What I guess people call the chicken and egg problem or the cold start problem in marketplace is by doing a couple things. In the early days, we wanted to make sure that drivers, when they were sitting around, were kind of like paid for that time. So in the early days, we paid a driver $20 or $30 an hour to sit there, right? And, you know, this lasted probably 60 or 90 days into a market launch. And then after, you know, it became-... clear that the driver's making 20- more than $20 or $30 an hour, we remove that guarantee and sort of let the marketplace float naturally. We also did things like we put drivers near places where we knew we'd have high demand in cities. Um, and then we made it really easy on the demand side to refer your friends. So if you were riding in a car with somebody and they hadn't used Uber yet, by the time you got out of the car, you would have referred them and you each would have gotten, like, $10 off your next ride.
- HSHarry Stebbings
You have this moment where you're like, "Holy shit, we have 100 people on the app. We're fully utilized." How do you ramp supply at scale then? And are you doing paid marketing at this point?
- SGScott Gorlick
No. (laughs) So, um, so in terms of scaling up drivers, um, it- I would say, like, it was- we did things that didn't scale for a lot longer, uh, than people would think. Um, and, you know, I think, you know, there were a couple of things that... Go ahead, Harry.
- HSHarry Stebbings
What did you do that didn't scale? I'm just intrigued.
- SGScott Gorlick
Yeah. So for probably the first million drivers that we onboarded, a lot of our processes were manual, right? So we weren't doing a lot of, like, paid spend on Facebook. We were doing a little bit on Craigslist. We weren't doing a ton on Google. But it was really the operational teams going out and finding drivers. It was that cold calling, right? It was getting drivers to show up at the office and batching onboardings first with, like, one driver at a time, then five, then 10. Then you would basically get, you know, a conference room at a hotel to onboard 25 drivers at a time or 100 drivers at a time. And it just kind of, like, scaled up. Other things that we did that I think were, like, super effective were we'd go where the drivers were, right? Like, we knew that we had a captive audience on Monday mornings and Thursday afternoons when drivers picked up and dropped off people from the airport. And we knew that if we went there with snacks, or coffee, or rented sort of a conference room where they could chill out between rides, we could pitch them on driving Uber. And, you know, we saw it as, like, very incremental to what they were building. So, you know, every city at Uber was kind of like running a playbook, but if we found something that worked in one city, we'd bring it everywhere else too.
- HSHarry Stebbings
What were the biggest things that worked in cities that you brought everywhere? So renting a hotel room, giving it to them for downtime and then pitching. What else?
- SGScott Gorlick
I think, honestly, people underestimate how effective cold calling was. Um, cold calling was an incredible mechanism to get people through the door. And then the other thing, Harry, that worked super well, um, is referrals, right? So when we started doing referrals, um, of drivers, we would, you know, pay like a $25 or $50 bonus for a driver to bring their friend. And then when they completed, like, their first 10 trips, we'd pay out the bonus on both sides. And, you know, obviously, as the business scaled up, the (laughs) referral bounties got quite a bit bigger. But we found that when we tapped into a specific driver community, um, they all kind of knew each other and were very happy to refer each other because Uber allowed them to buy more cars and expand their business. And it really just helped them grow, um, as sort of a business, uh, at large.
- HSHarry Stebbings
Can I ask, what didn't work? What were some early mistakes in driver acquisition, specifically actually, that were like, "Oh, that- that was a bad one"?
- SGScott Gorlick
Yeah. So we made a lot of mistakes, right? So I would say, like, the number one mistake we made in a lot of cities is we probably got kicked out of every office, um, that we joined early because, you know, we were renting, like, space in, like, coworking spaces, and a lot of these coworking spaces weren't too happy with drivers coming by, like, all hours of the day and sort of disrupting the flow. So I- I think that was sort of a major error that we made early on. Um, I think other things that we did that were kind of a little bit challenging, um, in markets is I think that, you know, where- where we messed up was it was a very, like, 24/7, 365 operation. There were people in cars every single hour of the day. And we probably understaffed a little in the early days, right? So, you know, for the first year in Atlanta, I was the only person handling the driver side. We had Keith, uh, overseeing the city as a general manager, and he was incredible, and we had a marketing manager. But, you know, I probably had like 1,000 or 1,500 drivers that were just me. And like, you know, we didn't have any of the AI tools that we did today. It was just like all on a Google Voice and sort of back and forth texting, Zendesk. We were- we let a lot of things slip through the cracks. But the business on the foundation was working.
- HSHarry Stebbings
Were you concerned at the time that the economics were upside down? Obviously, when you start a city, the economics are always gonna be pretty ugly in the early days. It takes a while for these new cities to mature. Were you concerned in the day-to-day that the economics did not look good?
- SGScott Gorlick
I think when we talk about unit economics, I think, like, at scale, we always kind of knew that, you know, the margins would correct themselves at scale, um, if we could kind of rationalize the competitive playing environment.
- HSHarry Stebbings
Can I ask, in terms of those kind of, uh, margin improvements, how did you see margins and economics change as the company progressed in new cities? Like, did the maturation rate become much quicker? What were some lessons from that? I'm just intrigued.
- SGScott Gorlick
Yeah. So I would say the biggest difference on the unit economics over time was we had to play the game on the field, right? Um, there were a lot of competitors in different markets. And at the same time as we were raising money, um, SoftBank was pouring money into all the different competitors, right? So even though we were in 2014 and the business was five years along, like, the unit economics, as we launched UberX and had more competitors, actually got worse over time because you started spending so much money to acquire drivers, to acquire riders. And until the competitive market, like, rationalized, right, and SoftBank sort of, like, pulled back a little bit or decided, or Uber decided exactly, like, where we wanted to play, it was very challenging to basically be like, "Hey, Harry, we're gonna cut all driver incentives tomorrow. We're gonna cut all rider incentives." Because we would have seen that market share reflected and that would've stunted our growth.
- HSHarry Stebbings
With the increasing competition and increase in cash to competition, did you actively see it become harder to acquire drivers?
- SGScott Gorlick
Yeah.Um, you know, I think there was a point in San Francisco, and don't quote me on this number, is over time, right, like we were paying $25 or $50 for referrals in Atlanta, and then we started paying like $250 to each side, the ri- the driver that referred and the driver that signed up. We, and then we escalated to 500, 500, and I think there was a point in time where in San Francisco and a couple of other very competitive cities, we were paying $1,000 to each side. So, $2,000 per driver acquisition, and, you know, we would put some sort of thresholds around that, right? The new driver would have to do X amount of trips and maintain this quality rating and do this sort of acceptance rate. But there was a period of time, probably like 2014, 2015, 2016, where things got very gnarly.
- HSHarry Stebbings
How did you define a retained user? You know, with Facebook they always said it's like after five friends, then you're a retained user. What was the metric to understand user satisfaction, retention as a core North star?
- 16:28 – 23:55
The Success of UberX: Free Week & Product-Market Fit
- SGScott Gorlick
- HSHarry Stebbings
Wow. That is impressive. How much money did that cost?
- SGScott Gorlick
A lot. (laughs) Um-
- HSHarry Stebbings
That is- But, but the idea is then you get a habit-
- SGScott Gorlick
Yeah.
- HSHarry Stebbings
... in the consumer. They build a habit of forming exercise with it and then retain.
- SGScott Gorlick
Yeah. The idea in terms of like ROI on free UberX week was previously Uber was just a black car product. Um, and by launching UberX we could do better, faster, cheaper than a taxi, and we kind of wanted to come out with a bang, right? And to be able to do that we were comfortable saying, "Hey, this free UberX week is gonna cost us X trips in a week times X dollars." And, you know, we, we were comfortable with that spend because if we looked forward six months, the business was going to be a lot bigger.
- HSHarry Stebbings
Would you say now with the benefit of hindsight free UberX week was incredibly, incredibly instrumental to the success of UberX?
- SGScott Gorlick
I think it would have worked no matter what. Um, I think like we had strong product market fit, but I think like what was particularly interesting about free UberX week, looking back on it 10 years later, uh, in hindsight was the competitive dynamics, right? So, in a lot of ways when we launched UberX, the main competitor was Lyft, and Lyft's flagship product was UberX. And what a lot of people don't know about Lyft is when we started launching UberX, we let Lyft go first and we had a policy that said, "Hey, if Lyft, uh, launches in a city, we are going to wait 30 days to see if the law enforcement, uh, comes after them, and then we're going to launch after that." So, as you probably know from Uber, that was a very abrupt, uh, t- sort of... It was a very different tack than we had taken on other launches and it didn't last very long, right? We probably did that for like three, or four, or five cities, and then we just started launching at the same time. So, when we launched UberX, it was about market share and it was about getting as many drivers as possible as quickly as possible so that we could win that market and carve out a position, uh, that we felt really confident in going forward.
- HSHarry Stebbings
Was it very clear when you were winning a market early on?
- SGScott Gorlick
Yeah. I mean, I think what was interesting about, like, the Uber/Lyft dynamic is when, when we went into a market, like Atlanta, we had been operating for 18 months before we launched UberX, or 12 or 18 months, and Lyft was kind of new on the scene, so they didn't necessarily have the brand that we did. So for us, it was a brand extension of saying, "Hey, now it's the same Uber, but better, faster, and cheaper." And Lyft had to kind of come in and sort of build that brand equity. So I think that was challenging in Atlanta for them and some of the markets where Uber was more established. But if you go to a place like the center of the country where both services are launching at the same time, like in Oklahoma City, it was more of a dogfight in the early days, and, you know, we certainly cranked up our spend to make sure that we were winning early market share, um, and sort of getting the drivers quicker. I think the big differentiation, um, in Uber versus Lyft is that we had on-the-ground teams in every market, um, and, you know, we had an Atlanta city team, we had a Philadelphia team, we had a Chicago team, and Lyft operated completely out of San Francisco. So while they would fly in launchers to a city who would stay for a couple weeks or a month or kind of like pop in and pop out, we were with the drivers every single day and sort of working closely with them. So I think our speed and proximity to them gave us the edge because, Harry, it wasn't really about like growth marketing in terms of like growing the rider side, it was just how many drivers can you get and that sort of drove the network effect and, and helped you get bigger.
- HSHarry Stebbings
Well, talking about the differentiator there, being like, being on the ground, being in person, when you launch a new city, can you just talk me through that city playbook rollout? Do you just pick random people and send them? How many do you pick? What's the organization? Can you just walk me through that?
- SGScott Gorlick
Yeah, so at Uber, we saw almost every city as its own startup, and that was an incredibly freeing thing for people that were young in their 20s and 30s to kind of go into a market and create it from scratch. And the playbook was probably 180 steps. We should probably open source it at some point. It's on an Asana checklist somewhere. But how we thought about it was we wanted the right team, and, you know, for us, the right team meant we were hiring for three roles. One was we'd send in a launcher, um, that would kind of pop around from city to city. We had launchers that started out in LA, then did Philadelphia, then did Atlanta, and sort of the profile of the launcher was, uh, MBA type, private equity, banking, and, you know, the launcher would be responsible for hiring a team. So in a general market, we would want a general manager who acted as like the CEO of the city, overseeing both driver and rider, and that person was, uh, very similar background to the launcher, banking, private equity, consulting, MBA. Stanford Class of 2012 was very good to us. And then the second role that we hired was an operations manager, and that was more like banker consultant types, like me, um, that would oversee sort of the driver, uh, area of the operation and be responsible for growing that. And then we'd also work on, uh, getting a marketing manager that would oversee the rider side, BD, uh, partnerships, uh, building out the early grassroots efforts in the community.
- HSHarry Stebbings
Okay, so they're sitting in an office day-to-day, and they have compre- complete free rein over the city. How does that control and decision-making look like from their perspective?
- SGScott Gorlick
Yeah, so everything was pretty autonomous, right? I- in the early days, uh, we all, I think, reported in... all the cities reported into Ryan Graves, uh, who was Uber's first CEO before Travis, incredible guy, and, uh, basically what happened, every city had like the freedom to experiment and try things, and I think we had a pretty flat org structure in the early days. Everybody reported into Graves, um, who was Uber's ce- first CEO and later became the COO, um, and is an incredible guy. Um, love Graves. And what's really interesting sort of about that is we, we all kept each other accountable, right? We were all doing really hard things, and every week, we would get on like a city call, um, where an all-hands call, and every city would go down a list and say, "How much gross bookings you did last week, how many trips you completed, how many drivers you onboarded," and sort of general highlights from the city. And we had everything in a dashboard. Everybody at the company could see exactly what city was doing what, who was growing fastest, and it became like a really competitive dynamic that all just kind of like pushed each other forward, um, which was a really interesting approach.
- HSHarry Stebbings
Were there cities that were clearly behind and struggling, and what were the reasons for those struggling cities?
- SGScott Gorlick
I think there were definitely cities that fell behind, um, but in a lot of cases, like the teams were just incredible. Um, it was more a function of the regs. So a lot of times, you know, if a city was struggling, it would be due to the regulations and the laws, so, you know, they would make it really difficult to operate. They would take drivers. They would try to shut us down. And over time, that regulatory situation cleared up where, you know, we were able to operate more freely or, you know, we ended up moving the teams to other cities or sort of working on other projects. But I, I would say like, it wasn't, it wasn't like certain markets were underperforming because of, you know, the sort of like underperformance. It was more like external factors that people
- 23:55 – 26:24
Navigating Regulatory Challenges
- SGScott Gorlick
couldn't control.
- HSHarry Stebbings
When you get a regulatory warning, when you get regulatory controls put on you, how does that feel? What does that look like? Can you take me to one?
- SGScott Gorlick
South by Southwest Austin 2014, um, the Mecca for all things tech. And in Austin, we were not allowed to operate because there were two rules in Austin that prevented us from doing so. If you ordered a black car in Austin, the minimum fare, whether you're going a block or a mile, was $55. And if you ordered a car and it showed up in one minute, you had to legally stare at it for another 29 minutes before being allowed to get in. So-It made absolutely no sense, Harry. So what we did in 2014 was we decided that we were going to do South by Southwest, like we'd done the previous years, and this year, we decided to do black cars, and we actually did the $55 minimum fare, um, which was a bonanza. A lot of drivers did very well, um, and we brought in drivers from Austin, from Dallas, from Houston, from San Antonio, and it was incredible. Um, the authorities weren't super concerned about like the pre-reservation, like get a car and then it shows up 29 minutes later, et cetera. But what we did on UberX really inflamed them. So what we decided to do was we decided to do free UberX for all of South by Southwest, but what ended up happening was that, you know, we paid the drivers a set dollar amount per hour, so the drivers were paid, and then we basically said, "Okay, cool. We're going to let the riders ride for free," right? So what ended up happening was the regulators ended up targeting some of the cars and requesting specific cars come to specific places, and on the way out of the car, the ride would proceed as normal, and on the way out of the car, the rider, that was their plan, actually left a $20 bill in the car, um, just in the back seat, and then after the driver let the rider out of the car, the cops would come up and cite the driver, right? So that was an incredibly frustrating experience with regulators, uh, among laws that just didn't make sense. But, you know, we scrambled our whole team back at the house, we worked with counsel, and, you know, we were able to make sure that like everything worked out okay. But, Harry, these laws are absolutely insane, and, you know, I'm- I'm a much bigger fan of smaller government.
- 26:24 – 27:02
Competition with Lyft
- SGScott Gorlick
- HSHarry Stebbings
Did the team view Lyft as a competitor?
- SGScott Gorlick
Yeah, I mean, I think Lyft was an incredible competitor. Um, I think that, you know, they did a lot of things right early on. I think they did a great job on the driver's side building like community, and, you know, probably did a better job leaning in there from us.
- HSHarry Stebbings
What do you think they did that you didn't do that you'd take?
- SGScott Gorlick
One of the things that we probably messed up, and, you know, the team has gotten a lot better about this, is like we were probably a little bit transactional at times with drivers in terms of scale. And, you know, if I could go back in time, that's something I would have, like, reinvested in. But I think that's something that Lyft got right early
- 27:02 – 27:54
Innovative Strategies & Mistakes
- SGScott Gorlick
on.
- HSHarry Stebbings
We mentioned kind of reckless versus necessary playing the game on the field. How much of an impact did promos have, discounts have? How much of an impact did that have in driving early demand?
- SGScott Gorlick
On early demand, not really much, right? We were in a market and we had wild product-market fit. Once competition came in, you could start to see market share swings based on the specific rider promo that Uber was offering in a city in a given week, and then we'd measure it and understand, or what Lyft was doing. Or like if we made a pricing move, they would make a pricing move. Like there was a lot of sort of, uh, back and forth, and we would see those effects in market share. And it wasn't because any particular, um, product, was... It wasn't anything to do with the product. It was just pure price.
- 27:54 – 34:33
Challenges & Lessons Learned
- SGScott Gorlick
- HSHarry Stebbings
There's some elements which at the time seems brilliant, and with hindsight you're like, "That was really stupid." What at the time seemed brilliant that you look back on and are like, "Oh, I can't believe we did that?"
- SGScott Gorlick
We tried to do too much, simply put. Specifically, you know, we were looking at, like, uh, doing like a vertical takeoff and landing type, like helicopter play. We were doing Uber Elevate. There were just a lot of things that became distractions from the core mission of moving people around cities and delivering food that, um, you know, were problematic and sort of like hindered, uh, Uber's growth. But at the time, we thought they were actually really smart and we wanted to go all in.
- HSHarry Stebbings
What did Uber get most wrong, do you think? When you look back now, what's the, "Oh, that was the mistake"?
- SGScott Gorlick
I think our aggressive stance with riders and politicians clearly worked because we were able to create a lot of fans of Uber over the years. But if I could go back or we could go back and do it all over again, I think we would have found a way to present our image in a way that was less combative, right? Especially with media. I wish that, you know, we could have built like a- a better story, um, because I think like when you come out and, you know, I think we had a lot of bravado, we had a lot of swagger, I think when you come out like that, everybody wants to build you up on the way up, and then they want to tear you down on the way down. You know, I probably would have been combative in the areas that we were with, uh, with like riders and- and politicians, but a little bit more humble and gentle with sort of media.
- HSHarry Stebbings
Do you think they did that over time? In the matu- maturation of Uber as a company, with the transition of TK out and Dara in, do you think they slowly ingratiiated that the regulators are- the regulator is our friend friendly face?
- SGScott Gorlick
If you look at where Uber got to, right, it never would have become what it was without Travis. Travis is such an incredible operator, one of the grass- best like CEOs of the generation. He's incredible and wonderful to work with. Um, and, you know, Uber would not have become the $150 billion company that it was, that it is today, um, without him. I think over time, um, what would have happened, um, is, you know, when a company goes public and when a company matures, the young upstart company that you are has to be a lot more mature. And I think a lot of that transition probably happened under, um, under Dara and over the last few years since COVID.
- HSHarry Stebbings
What's your favorite lesson from-... working with Travis. Uh, you saw him across different stages, across different expansion segments. When you look back, what was your biggest takeaway or lesson from seeing him operate?
- SGScott Gorlick
I think what Travis is really good at is speed, right? He has a quote that's, "Fear is the disease. Hustle is the antidote." And I think what he did better than anybody else and does better than anybody else, is he sees something and he moves quickly, right? It's, "Hey," like, "let's try this out. If it works, amazing, we're gonna pour more gasoline on it. And if it doesn't, we're gonna keep trying until we figure it out." And I think what's really unique about Travis as, as a CEO is he, his just level of understanding across, like, product and operations is very unmatched. Like, he could dive into the weeds with engineering, but then he could nerd out with you on, sort of like positioning cars in different cities and, like, talking to drivers, uh, like 30 seconds later. The context switching and just the, the ability to kind of create things at speed and empower his teams to think that they can run through walls was unmatched.
- HSHarry Stebbings
I- I- I love that (laughs) . Um, can I ask you, do you think it was the right thing for him to move on?
- SGScott Gorlick
I don't think so.
- HSHarry Stebbings
Why? Where, where would it be now if he was still there?
- SGScott Gorlick
I'm a big fan of founder led businesses, and I think Travis is an incredible founder who, you know, should have been given the opportunity to lead Uber into the next generation. It's really unfortunate how things happened and played out, and I think that, you know, while Dara's done, Dara and the team have done a good job kind of building the business, and it's $150 billion company today, I think that founder led businesses do better over the long term. And, you know, I'm really encouraged by what I've seen, um, from Dara and the team, but I do think, you know, you lose some of that founder's edge, um, without Travis and some of that magic, and I think the speed slows down.
- HSHarry Stebbings
How do you think it would've been different though? Do you think it would be more products? Do you think it would be more countries? Different bra- like, how do you think about a, a Travis versus a Dara in terms of how it would be different?
- SGScott Gorlick
So yeah, I think things probably would've been different had Travis stayed. I think specific things would've been on the M&A side. There were some deals we did in 2020, 2021 that didn't make a lot of sense. I know, um, Emil talked about Postmates. I think the Drizly acquisition probably didn't make much sense either, and some of the tie-ups that we did strategically in different regions probably weren't the right bet. Um, and then I think that, you know, on the Eats side of the business, things would've been different, right? In, when we launched Eats, it was growing really fast, but if you look at DoorDash versus Eats in the US, the market share is pretty pronounced. I think DoorDash has something in the sixties. Uber has something in the twenties. Um, while Uber Eats is still, like, the top food delivery brand, uh, worldwide, I think we missed a big opportunity and were distracted by everything that was going on, um, when Travis left, to really execute. And, like, I think the narrative is really around the DoorDash focused on the suburbs and, like, Uber focused on the cities, and I think part of that is true, but I also think we were probably going, we were going through a really hard time, and it was hard to grow that business at a har- at a fast rate when all this change around us was happening.
- HSHarry Stebbings
Did it feel leaderless at the time?
- SGScott Gorlick
A little bit. I think when a company loses its founder, it's a very different situation. We had a deep bench of people that had been at the company for a very long time, um, and, you know, we trusted them to kind of, like, run the business, but when you have a committee or, like, a team of 12 people sort of running a business that had gone through a really challenging year, it's going to feel the effects of that.
- 34:33 – 35:56
What Travis Did to Generate the Followership
- SGScott Gorlick
- HSHarry Stebbings
Can I just ask one final one on Travis-
- SGScott Gorlick
Yeah.
- HSHarry Stebbings
... then I do wanna move to kinda more broader startup advice where we do a quick fire? He inspired this, like, followership. I think the best founders inspire followership. You see it with the Collisons, Tobi Lütke at Shopify, Travis, where I know many early Uber employees and they just fucking love him, and they love each other, and it's like this intense familial sentiment, which is really special. What did Travis do to generate this followership?
- SGScott Gorlick
The best founders build cults and their cult leaders, and I think Travis, what he was really good at was inspiring the team. We would look left, we would look right, we would all have, like, a lot of, like, work on our plate, but we knew that if we put our heads down and did it, there would be an incredible journey on sort of the other side, and Travis was really good of explaining the what and the why behind everything. You know, during Zurb, a lot of founder CEOs got a little soft, um, and I think, like, Travis was always willing to roll up his sleeves, dive in, and figure out the answers to the messiest problems, and I think, like, the best idea always won with Travis, and as a, as a team, we had a lot of respect for each other, and we were, we had strong opinions, but they were loosely held and we were all kind of, like, going to war together every day, uh, on this, like, mission together, and that felt really good, and that's what built the lifelong bonds.
- 35:56 – 40:22
Quick-Fire Round
- SGScott Gorlick
- HSHarry Stebbings
Dude, I would love to do a quick fire with you. So I say a short statement, you give me your immediate thoughts. Does that sound okay?
- SGScott Gorlick
Let's do it.
- HSHarry Stebbings
Okay. So what's the most common, expensive, deadly mistake you see founders making?
- SGScott Gorlick
I think the biggest mistake that I see founders making day to day is not having a handle on their metrics, right? I think everybody measures metrics in, like, a different way, and I think we've kind of entered an era of death by a thousand dashboards, and I would love if everybody sort of said, "Hey, here are the three or four most important metrics for our business," and aligned around that.
- HSHarry Stebbings
What's the hardest part of the Uber business today?
- SGScott Gorlick
I think it's probably, for me as an investor now, um, on the outside, um, I think Dara and the team have done an exceptional job, um, but the question, the area I have the most questions about today is, um, on autonomous vehicles and sort of, like, what the strategy is there.
- HSHarry Stebbings
What should the strategy be there?
- SGScott Gorlick
I think the...... notion that, like, Uber was a hardware company, right? And building, like, cars is probably hard for, like, a software company. So I think the decision to partner with, you know, the leading AV players in the space, doing things with, like, the Waymos and the Cruises of the world and trying to bring their fleets onto Uber is the right long-term strategy. I guess, you know, my questions around, like, "Hey, like, how far out is AVs? What does it look like?" And, you know, "What does the business look like?"
- HSHarry Stebbings
What's the number one reason that Uber beat Lyft?
- SGScott Gorlick
I think it comes back to really being close and in the cities where we operated. When we could be with drivers one-on-one, 24 hours a day, seven days a week, versus being in San Francisco and flying in, like, a couple of times a month, I think just being close to your customers is just such a big edge.
- HSHarry Stebbings
Why did Uber Eats lose to DoorDash?
- SGScott Gorlick
Uber's the number one food delivery platform in the world, but I think we really fumbled the bag in the US, um, with DoorDash. I think we missed out on a huge opportunity. I think going back to, you know, 2016, 2017, there were a lot of distractions around the business. Um, and, you know, it's a great business in the US and, like, continues to make strides, but, you know, I, I think we missed out on a major opportunity to be the number one food delivery player in the US.
- HSHarry Stebbings
What element of the Uber business is amazing, but not discussed enough?
- SGScott Gorlick
I think the ads business is a monster. I think ads is really interesting, because it's, I think at a billion dollar run rate now. And what's really interesting is if you think about Uber as a platform, it's the app where you go from like point A to point B, it knows where you're going, it knows, like, what shops you're re- visiting, like, what restaurants you like, et cetera. And if you have that knowledge, you can then push ads to somebody, um, in the app. And whether it's, like, video or, um, or text or like a promotion for a movie or the US Open, like, there are a lot of things that you can do with that data. And I think, like, they're just barely starting to scratch the surface.
- HSHarry Stebbings
Uh, what would you most like to change about the world of growth?
- SGScott Gorlick
Just generally, alignment on metrics. I think across companies, we have very different definitions of what revenue means. Right? Is it annual run rate? Is it annual recurring revenue? Is it gross bookings? Is it net revenue? Is it total payment volume? And I think, like, if we all started speaking the same language, the world would be a lot better place and it would make it easier for growth investors.
- HSHarry Stebbings
I think, I think for me it's, like, input and output metrics. The amount of times it's like, "Hey, revenue's our metric," and I'm like, "No, number of rides per week is our metric. I don't care about the revenue, that is then output metric." Final one, what's the best growth strategy that you've seen in the last 12 months, um, and why have you been so impressed by that one?
- SGScott Gorlick
I'm a huge Perplexity user. I think it's an amazing product. Um, huge fanboy, to use your language. And, uh, you know, I think one of the things they've done recently that's really interesting is they're offering a free pro membership, um, to anybody with a LinkedIn premium account or an Uber One membership. So instead of spending $20 a month or $250 a year, you plug in your info and they'll give you the free usage. So they've basically kind of locked in people for a year and, you know, if you believe that Perplexity could be, like, the next Google Search, you know, you're happy to pay that CAC or sort of that free membership and sort of the GPUs over the year to acquire those users and generate stickiness when a lot of tools are facing high churn.
- HSHarry Stebbings
Dude, this has been so much fun. As I said at the beginning, for me, the best is when you have stories that then are very tied to lessons. Uh, I mean, the stories are incredible. I, I still can't get over the first email to travis@. Um, but thank you so much for joining me, and I've so enjoyed this.
- SGScott Gorlick
Harry, thanks so much. It was a pleasure.
Episode duration: 40:32
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