New Uber CEO Hints at 2019 IPO as He Takes Over Troubled Startup – Bloomberg
Rewriting the company’s ethical code will be a symbolic way for the newly appointed chief executive officer to put his stamp on a company scarred by months of management turmoil, allegations of widespread sexual discrimination and mounting legal threats.
Uber is turning to the 48-year-old Expedia Inc. CEO to articulate what the transportation Goliath should stand for and inspire a workforce of more than 15,000. His reputation as a man of principle with little ego is a stark contrast to his predecessor, a brawler who became enmeshed in a wide array of scandals, according to people who have associated with both men.
Kalanick introduced the new CEO to employees at a staff meeting Wednesday morning. Khosrowshahi, who starts Sept. 5, cracked jokes and fielded inquiries. In response to a question about going public, he said it would probably happen in 18 to 36 months, according to two people who listened to the meeting. “It’s my opinion that the company should go public,” he said.
In addition to taking the CEO chair, Khosrowshahi will likely get a seat on the board opposite Kalanick. Meanwhile, the former chief has expressed interest in returning to a more active role at the company since he was ousted in June, creating a potentially awkward dynamic that Khosrowshahi will need to manage. Past colleagues, friends and family describe Khosrowshahi as an understated, measured negotiator, who will challenge anyone who stands in the way of what he believes in, including the U.S. president — someone he’s antagonized on multiple occasions.
“I saw him work with strong personalities and complex situations, and simplify to focus on what actually matters,” said Jeremy Liew, a venture capitalist who reported to Khosrowshahi at IAC/InterActiveCorp. “He has a strong moral compass.”
Khosrowshahi was shaped by his escape from Iran as a boy, just before the chaos of the 1979 revolution. He came with his family to the U.S. as a 9-year-old refugee. He grew up in Tarrytown, New York, with his mother and brothers. For most of his teenage years, his father was detained in Iran after returning to care for Khosrowshahi’s grandfather.
Even in re-telling the story in a letter to employees following Donald Trump’s ban on immigration from certain Muslim-majority countries, he deflected sympathy. Though a refugee, Khosrowshahi said, he didn’t feel like one as a child. “For the grown-ups, it was a difficult transition,” he told Bloomberg Businessweek this year. “The kids were able to party together, so it was fun.”
The family prospered and ascended America’s business ranks. After studying engineering at Brown University, Khosrowshahi took a job at investment bank Allen & Co., where his brother is a top dealmaker today. Their cousins are prominent venture capitalists and senior technology executives at Intel Corp. and Alphabet Inc.
Barry Diller, the billionaire media mogul, recruited Khosrowshahi into his inner circle during the dot-com frenzy in the late 1990s. Diller asked Khosrowshahi to scout acquisition targets and put together the sprawling internet empire known as IAC. He worked on the company’s purchase of Expedia in 2003 and then took over the online travel business.
Peers in the corporate world admire Khosrowshahi for his trustworthiness and strong values, traits that can be hard to find in the world of deal-making. “I just found him to be one of these solid, hopeful, humble leaders,” said Omid Kordestani, Twitter Inc.’s chairman and a fellow Iranian immigrant who makes a point of seeking out Khosrowshahi at the annual Allen & Co. conference in Sun Valley, Idaho.
Khosrowshahi has been a central figure in the travel industry for more than a decade. He oversaw the spinout of Expedia from IAC in 2005 and then led a corporate shopping spree with shareholders’ blessing. He spent the last few years orchestrating mega deals. He dropped nearly $5 billion in a single year on just two companies, Orbitz and HomeAway. While Expedia’s market value is dwarfed by Priceline Group Inc., Khosrowshahi’s company has outperformed its larger rival’s stock since the acquisition binge in 2015.
But Khosrowshahi’s track record isn’t spotless. He took a pass on buying Booking.com in the mid-2000s. Priceline purchased the site soon after for $135 million, turning it into one of the most successful acquisitions of its time. It now contributes about 80 percent of Priceline’s $12 billion annual revenue. This year, Expedia needlessly invited Uber-like controversy. It was one of the last remaining advertisers with Fox News’ “The O’Reilly Factor” after dozens of brands dropped the show amid sexual harassment allegations about its host.
In contrast to the unscripted persona of Kalanick, a 41-year-old paper billionaire who coined the phrase “Boob-er” to describe his company’s ability to attract women, Khosrowshahi carefully curates his image. He has four children from two marriages. He fills his Twitter feed with pictures of family, thanks to his mother and wife for their support, and grainy concert photos of dad-rock bands like the Shins and U2.