by Isaac, Mike
The most memorable parts were the tennis tournaments. Kalanick was a driven tennis player—on the Nintendo Wii. He soon bested all of his friends and most of the global players who scored themselves online. Whipping the white plastic handheld Wii controller back and forth while bouncing around his spartan living room—mostly empty of furniture—he looked like a tech-world McEnroe or Agassi, power serving against hapless competitors.
The JamPad served two primary purposes: a place for Travis Kalanick to crash, and a place for Travis Kalanick and his techie friends to riff on ideas. “Jamming,” in Kalanick parlance, was like playing in a jazz quartet or a psychedelic rock band. Kalanick’s enthusiasm and support for risk-takers bred around him a small following of devoted friends. It all started, he would say, with a jam sesh.
“It’s ad hoc, but eventually it sort of comes together into beautiful music,” Kalanick said.
Garrett Camp still couldn’t get the idea out of his head.
The cabs in his city were shit. Worse, since he’d been blackballed from most of the services, he had begun resorting to black car services, and had collected a laundry list of the best private drivers in San Francisco, repeatedly pinging them whenever he needed a ride for a night out.
But even that was imperfect. The money, the complexity of arranging pickups, the confusion of sharing rides with friends. It was too messy. He needed the best kind of cab—one he or any of his friends could hail directly from their iPhones. He needed an ÜberCab.
That became the working title—along with a few other options like “BestCab”—for the imaginary app he had designed in his head. Eventually, he’d drop the umlaut; it was too confusing for American audiences. But Camp wouldn’t let the idea go, and brought it up with nearly all of his friends, including one budding entrepreneur and angel investor, fresh off a recent company sale: Travis Kalanick.
Camp joined Kalanick at the JamPad along with a host of other young entrepreneurs, most of whom came from companies Kalanick cared about or had a financial stake in. David Barrett and Lukas Biewald, two of Kalanick’s portfolio company CEOs, made regular appearances. Kalanick funded another JamPad friend, Melody McCloskey, who would later go on to found the startup StyleSeat.
And then there was Camp, who wouldn’t stop talking about his idea for UberCab. He chattered incessantly to Kalanick about its possibilities. “Did you know taxi medallions can cost, like, a half a million dollars a year?” he’d ask friends. “Have you ever looked into how base stations operate?” he’d go on. And the tech was inefficient, he’d pointed out; yellow, busted old Crown Victorias that barely made sixteen miles to the gallon were reliant on little more than two-way radios and their watchful eyes in order to find fares. There had to be a better way to give people rides.
Camp couldn’t leave out the best part. They’d market UberCab to professionals in dense cities—people like themselves—and try to make it feel exclusive, almost like a club. You’ve got to be a member to use it, guaranteeing a “respectable clientele,” and they’d only accept top-of-the-line luxury vehicles. The kind you’d want to be seen in riding around town: Mercedes, BMW, Lincoln. Best-case scenario, Camp believed, is that he created a market leader in private transportation, with the possibility of hundreds of millions in annual revenue. At worst, he’d create a small black car service for executives in San Francisco; basically, an upscale transportation service for himself and all of his friends. Even if he lost, he would win.
He wasn’t subtle about pushing the idea. “Uber” replaced “great” in his vocabulary, a way to call things great. Things were “uber” this and “uber” that. That car? Uber cool. Tasty pizza for dinner? Uber slice. He wanted Uber to become something more than a German preposition, a noun synonymous with cool.
Both Camp and Kalanick loved the idea. The problem was, neither Camp nor Kalanick wanted to run it. The thirty-two-year-old Kalanick was still trying to embrace his role as The Wolf, a “funding shepherd,” after years of nonstop work at Red Swoosh. And when Kalanick wasn’t doling out advice to young CEOs, he was hopping planes to Europe, South America, Southeast Asia, fulfilling a wanderlust he wasn’t able to satisfy while hunkered down in the startup cave. Camp also wanted to own the cars and garages used by drivers, something Kalanick was completely uninterested in overseeing. It was a small detail, but one that turned Kalanick off.
But Camp wouldn’t drop the idea. And eventually, after letting go of owning the cars and garages, he wore Kalanick down. The two lived together during a trip to Paris for a tech conference. After a series of drunken nights spent doing math over candlelit dinner tables, arguing over how much they could make per car, or whether they should own the vehicles, Kalanick and Camp returned home inspired. It would take Kalanick a few more months to sign on full-time, but Camp had finally convinced him.
Uber needed a fighter to lead it, one who could take on the cutthroat world of venture-funded competitors while battling the entrenched taxi cartels. They both knew that Kalanick was the right man for the job.
Chapter 5 notes
¶ In this modern era, a venture capitalist couldn’t just fade into the background, as was historically the case. Now, VCs had to work overtime to become desirable in the eyes of young founders, and took every chance to market themselves.
PART Ⅱ
Chapter 6
"LET BUILDERS BUILD"
Being the right man for the job doesn’t make the job any easier.
Building a startup is very, very hard. To create actual software, a founder must first convince engineers to take a pay cut in exchange for company stock, then do the same with marketers, salespeople, and the rest of a lean staff. A founder needs to figure out payroll, finances, and taxes—and perhaps rent an office, if the founder doesn’t own a garage.
A founder needs to be able to wear any number of hats, from human resources one day to conference speaker and PR manager the next. As optimist, cheerleader, therapist, and problem solver, the founder must balance the needs of a growing company with those of each individual on staff, without neglecting their own spouse or children. And when the bank accounts start getting low, a founder needs to get back down to Silicon Valley and start hustling for more dollars. With money in the bank, a founder must then juggle the demands of the backers, who expect nonstop growth.
Even if a founder masters all of these things, there’s no guarantee the company is going to work. The timing may be wrong. The company might run out of money before the idea can flourish. Or maybe the idea and cash flow are both solid, but the product itself isn’t resonating. Having a good idea is important. Executing on that idea is paramount. Silicon Valley is teeming with people with big ideas and empty bank accounts. It is a town where being first to an idea doesn’t always mean you’ll end up the winner.
Neither Camp nor Kalanick wanted to take on the founder’s challenge for their on-demand, app-based fleet of luxury black cars. So they tweeted out a call to arms.
On January 5, 2010, Kalanick posted: “Looking 4 entrepreneurial product mgr/biz-dev killer 4 a location based service. . pre-launch, BIG equity, big peeps involved--ANY TIPS??” he tweeted.
Just then, a twenty-six-year-old intern named Ryan Graves happened to be looking at Twitter, and spotted Kalanick’s request. He was interested, but didn’t want to come off as too desperate. Three minutes later, he tweeted back at Kalanick with a cheeky response: “heres a tip. email me. :) graves.ryan[at]gmail.com.”
Though Graves didn’t know it at the time, that tweet would eventually net him more than a billion dollars. It proved to be the luckiest decision he’d make in his life.
But at the beginning of 2010, Graves was still an aimless twentysomething, one of many trying to hit it big in the startup world. Taking a chance on a gig at UberCab seemed like a cool thing to do.
Graves looked like the captain of the football team. He was 6'3" with dirty blond hair, a strong jaw and a toned, athletic
build. “Surfer bro” might have been another apt nickname. Graves grew up in San Diego near the beach, paddling through the Pacific swells. On any given Saturday, you’d probably have found him near Ocean Beach or Tourmaline Surfing Park. When Graves left home to go to college in Ohio, he traded surfing for water polo and pledged Beta Theta Pi. His warm demeanor put people at ease, rare in the tech world. Friends loved to say Graves had a high “EQ,” or emotional intelligence, atypical of many engineers and analytical types who inhabit positions of power in the Valley. Friends and co-workers invariably described him the same way; Ryan Graves was “a good dude.”
Graves caught the entrepreneurial bug early. He worshiped entrepreneurs like Steve Jobs, Larry Page, and Sergey Brin, idolizing the way they built something enormously successful out of nothing but an idea and a computer. Graves’s Tumblr was filled with photos of Jeff Bezos, quotes from Albert Einstein, articles about Elon Musk. One personal favorite was an iconic quote from Shawn Carter, better known by hip-hop fans as Jay-Z: “I’m not a businessman. I’m a business, man.”
In 2009, he was bored of his job as a database admin at GE’s health care unit in Chicago. He wanted a cool job, perhaps at one of the startups whose apps populated his iPhone home screen. One of those was Foursquare, a buzzy, location-based mobile check-in startup that had cache among the Valley elite. He tried applying through the front door, but was quickly turned down; Foursquare was inundated with offers from eager would-be tech workers. Instead of giving up, Graves had a better idea. On nights and weekends, he started calling around bars and restaurants in Chicago, pitching owners and managers to sign their businesses up for the Foursquare app. By pretending that he actually worked for the company, Graves managed to sign up thirty new customers in the Chicago area. So Graves tried again, sending that list of new customers to Foursquare and some of its investors.
Managers at Foursquare were immediately impressed. Self-starters like Graves tended to excel in startup-land. They kept Graves on as an intern doing business development work for the company, based in Chicago.
During his time at Foursquare, Graves posted a picture of a small, metallic statue of an ape-man wearing a backwards baseball cap, waving a bone over its head while perched atop a pile of broken electronics. (The image was plucked from 2001: A Space Odyssey, a film more than twice as old as most Foursquare interns.) The hideous trophy was a Crunchie award, a prize given to Foursquare for having the best mobile app in Silicon Valley that year. It was the Oscar statuette of the tech industry, and Graves wanted one of his own.
Graves went to startup networking events and happy hours. He read TechCrunch, VentureBeat, the Times, the Journal, Techmeme—feeling the pulse of all things tech. His eyes were glued to his Twitter feed, where he followed all the venture capitalists, tech CEOs, and founders. One day, Graves hoped, he would star in an article by Michael Arrington, the Valley-famous lawyer turned TechCrunch founder whose stories could make or break a startup. All he needed was a shot. So when Graves saw Kalanick’s tweet, Graves seized the opportunity and replied.
The two took to one another almost immediately. Graves liked Kalanick’s worldliness and “funding shepherd” machismo. Kalanick appreciated Graves’s audacity, hustle, and energy. Graves was game for anything. Shortly thereafter, the twenty-six-year-old Ryan Graves became UberCab’s first full-time hire.
“I’ll be at the ground floor of a startup that has the opportunity to change the world,” Graves posted to his Facebook as he prepared to leave the Midwest. “The world of no health insurance, jamming late nights, endless responsibility, and some of the most fun I’ve ever had are ahead of me and I’m so stoked.”
Graves and his new bride, Molly, packed their truck, pulled away from their Chicago apartment and headed west to San Francisco.
Since neither of them wanted to do the job, Camp and Kalanick decided that Graves, young and full of hustle, should be the company’s first chief executive. Graves was ecstatic; he finally had his chance to prove he could make it at a startup.
It didn’t last long. Graves’s friends have always considered him an “A-plus guy,” but he turned out to be a B-minus chief executive. During the company’s early fundraising days, he’d walk into important meetings with venture capitalists and fumble stats or other talking points. Despite his confidence, he could never deliver a convincing enough pitch to seal the deal. Graves didn’t have company-building experience, like Camp, or the ability to rapidly crunch numbers, like Kalanick. Graves was a charmer and a hard worker, but those qualities only went so far. Investors were interested in the idea, but didn’t think Graves had what it took to make it big.
There’s a familiar line of thinking among the technorati: Good ideas are important, but venture capital is all about making the right bet on the right person at the right time. When sizing up a founder, a venture capitalist asks: Will this guy—and in the sexist tech industry, it was almost always a guy—be the one to take a startup from a handful of hard-working kids to a Fortune 500 company someday? Will this guy stick around when the shit hits the fan? Is this a guy I’m willing to bet millions of dollars on? People liked Graves. But for most of the VCs who met him, the answer to those questions was no.
During the early days under Graves’s CEO tenure, co-founder Camp began tweeting cryptically about UberCab. They hadn’t announced anything about their new venture yet, but the three men teased their “stealth startup,” a commonly used phrase to build allure (whether a project deserved it or not).
Rob Hayes, a partner at First Round Capital, saw Camp’s Twitter schtick and was intrigued. He sent an email, met the company, and quickly cut a check for nearly half a million dollars in the company’s first “seed” round of funding. Chris Sacca, a friend from Kalanick’s “JamPad” days, also threw in a chunk of capital, along with a handful of other close acquaintances who became “advisors”—a glorified title for early supporters. Of the early group of seed investors, though, Hayes and Sacca were the most hands-on, offering advice and strategy. Hayes and Sacca’s seed investments would one day be worth hundreds of millions of dollars.
That first seed round gave UberCab enough runway to build the essentials of a real startup. After working out of Hayes’s office at First Round Capital for months, the UberCab team rented desks in a shared workspace and started bringing on early team members.
Hayes, Sacca and others agreed: Graves was a great guy, but he was no CEO. He had to go. In an early meeting with Kalanick, Camp, and Hayes, they tried to break the news to Graves as gently as possible. Graves’s pride was hurt, but he took it well enough and accepted a position as general manager and vice president of business operations.
Kalanick took the opportunity to seize control. Upon agreeing to the CEO role, he insisted on being given a larger ownership stake in the company. It was important, Kalanick believed, that the leader of UberCab have complete say over his company’s path forward, which meant he should hold majority control. Kalanick didn’t care about his salary; he already had a taste of wealth after selling Red Swoosh. What he wanted was power.
He got it. Camp and Graves signed a chunk of their shares over to Kalanick as compensation for his new position, a move that would tie Kalanick permanently to the company’s outcome whether it emerged as a success or, more likely, an embarrassing failure.
During the reorganization, Graves achieved his long-simmering wish. On December 22, 2010, Uber’s first full-time employee was the subject of a TechCrunch article. It just wasn’t the one he had hoped. “Uber CEO ‘Super Pumped’ About Being Replaced By Founder,” the headline read, an emasculating take on Graves being punted downstairs. (Behind the scenes, he was decidedly less “pumped.”)
Kalanick didn’t have to pretend. His enthusiasm was real: “I’m frickin’ pumped to be on board full-time with Uber!” Kalanick said to the journalist Michael Arrington. Though Arrington saw the startup’s potential early on, he couldn’t keep a s
traight face.
“People are seriously pumped about this change,” Arrington wrote.
The first version of UberCab was not an app. Users logged in to a desktop computer browser, navigated to UberCab.com, requested a black car and, in theory, would receive a ride within ten minutes or less for only one and a half times the price of a yellow cab. It was more expensive, yes, but the idea was people would pay more for the reliability and convenience of on-demand service. Soon enough, the company farmed out development, and contract programmers hacked together a rudimentary version of an UberCab iPhone app. It was buggy and slow, but it worked.
Camp, a sucker for luxury, focused on branding. He was fixated on maintaining a fleet of high-end black cars like Lincolns, Suburbans, and Escalades. Even the initial launch motto—“Everyone’s Private Driver”—was supposed to convey a sense of exclusivity, an upscale way to get around town. Camp believed everything about the brand should exude coolness.
In the early days, that meant cold-calling hundreds of limo drivers around San Francisco and convincing them they should drive for the new service. That grunt work largely fell to Graves, who would Google black car services across San Francisco, show up to their garages, and pitch the bemused fleet staff on driving for UberCab.
The company struck an early deal with AT&T, wherein they bought thousands of iPhones in bulk at a discounted price. These they would hand out for free to drivers, pre-programmed to run UberCab’s software. The AT&T deal brought Luddite drivers onto the network as quickly as possible. Tens of thousands of dollars in iPhones lined the walls of UberCab’s offices, stacked like white bricks. They piled atop one another faster than staff could give them away. Matt Sweeney, an early employee, posed for an Instagram snapshot of himself splayed across a pallet of iPhone 4s with his eyes closed, a bed of shrink-wrapped handsets in pristine, minimalist Apple packaging.
