Uber CEO Dara Khosrowshahi: ‘Demand’s increased — we’re trying to meet it’

Every few weeks, Dara Khosrowshahi, chief executive of Uber, a company valued at $85 billion (£63 billion), changes out of his office suit and into “a vest and sweats”, clips on a helmet, swings himself onto an e-bike and goes out delivering UberEats in San Francisco. I assume this is for a photo opp, or a chance to spy on staff, but no. “It’s nice to get fresh air after a full day of Zoom meetings,” he insists. The first time he tried it, he wanted to know what it “felt like” to deliver food. Yes there was “huge demand”, it was “tough work” and embarrassing in the restaurant when he didn’t know where to pick up the food. But “it was a great experience for me”, he says. He even set himself targets, in terms of speed and service and tips, targets that he met.

I am not sure “great experience” would be how most UberEats guys standing in the pouring rain on a London doorstep would describe their job, but there’s something of the enthusiast about Khosrowshahi. I’m briefed that he’s in London promoting Uber’s billionth ride bonanza: one random rider will get into their Uber this month and discover they are the lucky recipient of free rides for a decade. Really, he’s here to meet Mayor Sadiq Khan for the first time. This is a significant development in the thawing relationship between Uber and City Hall, much improved since the dark days of 2017 when Khan revoked the company’s licence.

Of course, much of Khosrowshahi’s role in his four years as head has been mopping up after his predecessor. He was installed in an ousting of bad boy founder Travis Kalanick, who built the business on breaking rules, nicknaming it Boober because of the success it brought him “getting laid”. Back then, Uber seemed the worst example of rapacious start-ups. It ignored regulations, flouted passenger safety, ran on driver exploitation. Globally, it faced bans and fines. Among Travis’s litany of outrages was being filmed in the back of an Uber with two women while haranguing the driver when he complained about pay. “Some people don’t take responsibility for their own shit,” Kalanick told him, before being globally shamed into taking responsibility for his.

Khosrowshahi and Khan were joined by Gary Smith, general secretary of the GMB Union, which represents the capital’s 70,000 Uber drivers, and afterwards released a statement commending Uber’s commitment to pay drivers’ pensions, holiday pay and the national minimum wage (Khosrowshahi calculates they earn on average £24.50ph). Khan even cited it as a model for “other employers in the gig economy”. Once the enfant terrible, now the class goody-goody.

So, what about the cabbies for whom Uber was the enemy? “I think we’ve all learned that the world isn’t a zero-sum game,” Khosrowshahi says. “Uber can thrive; black cabs can thrive.” Also, Uber has bought Autocab, a company that puts black cabs on their app. He puts it thus: “We are hoping that we can become a friend of taxi operators and drivers by providing demand.”

Last week, Uber announced it had became profitable (on its own adjusted measure) for the first time in its 10-year history. But this profit — $8 million (£6 million) for three months to the end of September — was tiny compared with its stock market value. So what of Uber’s future? The New York Times ran an op-ed entitled “The Rideshare Bubble Bursts” last month. Was it right?

Khosrowshahi says not, but that “the constant at Uber has been change. And we have to be responsive to where the world is going”. He gives an example: since he arrived at Uber, their delivery business has jumped from being five to 10 per cent of the company, to being “bigger than the mobility business we started with”. Their aim is to build this “go-and-get” side of the business, “expanding the definition of UberEats from delivery of just food, to groceries, alcohol, convenience, and ultimately everything”.

So if you want a book from, say, Waterstones, they will go and get it — not like Amazon from a sprawling warehouse, but from a local shop. “We don’t want to build stores and warehouses,” he says. “Our magic is moving people and things in an on-demand way” while at the same time “using our technology to improve the competitive position of the local merchant”. In this way, they hope to “out-Amazon Amazon by getting you the goods, not next day, but next hour”.

The biggest challenge is pollution, he says. “But we are committed to being fully electric in London by 2025.” This is Khan’s target, he reminds me, adding that they are committing an additional $5 million (£4 million) “to improving charging infrastructure” across the UK, which doesn’t sound like much given the scale of the task.

So, Uber is going to change the way we live, while simultaneously saving the planet and the high street. Marvellous. But I feel I am speaking for everyone when I ask the following: How come Ubers keep cancelling on us? Why do they take so long? And why are they suddenly so expensive? Khosrowshahi smiles as if he’s been asked this by every Londoner he’s met since landing at Heathrow. He knows it’s been a nightmare “but we know how to execute behind this” (by which he means fix it).

The problem is demand. Not Brexit, or Covid. Demand has increased but driver numbers haven’t, which pushes up prices and lengthens wait time. And then there’s “multi-apping”, which is when your driver switches platforms to maximise earnings and you are cancelled for a more lucrative ride on, say, Bolt.

Certainly, Khosrowshahi’s nothing like Mr Boober. The New York Times described him as “weirdly normal for Silicon Valley”. He’s not entirely sure what this means, “I guess, no facial tics?” Trawling through his interviews online I find only two racy details. The first, his response to the question: would you smoke a blunt [cannabis] on the Joe Rogan show? He replied: “Depends on the hour.” The other: an admission that his second wife Sydney Shapiro told him to go date “a flock of models” to get divorce out of his system. Did he? “Yes. A very small flock. I concluded that [Sydney] was far better. And I came back begging.” Now they have twin boys.

I’d like to say Khosrowshahi is most animated talking about family, but then we get back to UberEats. “The sushi orders bring in the biggest tips,” he confides. “Way more than fast food. Whenever I get an order for sushi, I’m like: yeh!” He does a little air punch. Yup, “weirdly normal for Silicon Valley”.