Life is like an Uber ride - you have to decide what your destination is.
So declared Salesforce CEO Marc Benioff philosophically today at a ‘fireside chat’ with Uber co-founder Travis Kalanick.
Given the the gridlock and shortage of licensed taxis in San Francisco during Dreamforce week, some might be tempted to add that it’s less about the destination and more about what you’re going to be charged when your Uber turns up.
It’s a point that Kalanick accepted with some candour, describing this as the week in which:
Our people don’t sleep.
That said, it could be worse, he adds - it might be raining:
When it rains, the problem is that demand outstrips supply. We do as much as we can to get as many cars. The price goes up because we want to be reliable. We don’t want the price to go up. We want the price to be low and reliable. When it’s rain and Dreamforce…
Kalanick’s chat with Benioff drilled down into the philosophy and mission statement at the firm, with a particular emphasis on the technology undermining the operating model. He said:
We will do whatever we have to on algorithms, on technology side to make sure customers have quick, low cost reliable ride. When you think about where we come from, it was hard to get around this city. There weren’t enough taxis. You had to drive.
If you take reliability at meta-level, it’s that consistency in you getting a pick up in a short time and having safe, efficient ride. On the operations side that means we need thousands of partners on our system. We onboard thousands of people in San Francisco every week. We have to predict demand so that we can provide supply. There’s a filtering process to make sure they’re qualified.
Once they’re on the system, we need to make sure that routes are good and they get people from A to B. There’s customer feedback. You rate the driver and that comes back into ops so that over time we make sure that only the highest rated drivers stay on the system.
Demand predictability
An area demanding particular attention is that of demand prediction, which takes two forms, explained Kalanick:
There’s long form prediction and there’s real time prediction. Do we think that in the next 15 minutes there will be a lot of demand in an area? You have a heat map of demand and then you have cars on the map that are anti-heat. So then the drivers can go to the area where they likely to get demand.
Uber has become a by-word - almost to the point of cliche - for digital disruption of an established industry, but Kalanack insists this is only part of the story behind the firm:
The reason we started was because the taxi industry was broken. For drivers and riders. It was about drivers filling in the gaps from the start. We didn't know this would work. I'd go to Google and check out limousine services in San Francisco and put results into Excel. I’d ring them all up and make the pitch and say we could make them 50% more in a week.
A third of calls I got hung up on before I got to core pitch, a third I got a minute and a half until hung up, and a third said this was interesting. We didn’t even have the app yet. I knew the driver side was good. If you have a third saying yes please, you’re in a good spot.
Since then, the firm has expanded at a remarkable rate, delivering thousands of rides every minute in countries all around the world:
We’re about transportation as reliable as running water, everywhere for everyone. We are in 50,000 person towns in California. But everywhere also means we’re in Bangalore. Everyone means that it’s cheaper and everyone can get around. And transportation can mean for people or for things.
But the likes of UPS and Fedex don’t need to worry too much just yet on that last point, at least not on a city-to-city or country-to-country basis.
That said, if there’s something that needs delivering inside an Uber city, then:
We’re delivering cars in five minutes. That means there's a lot of things you can deliver in five minutes. If you’re a local merchant and want to send something, then Uber’s going to be there. If something moving from one place to another in a city, that’s our jam.
There are other innovations that have been introduced, such as Uber Pool, whereby a rider ends up sharing a car with others and getting a discounted price as a result. This is a logical development, argued Kalanick:
If you boil down product strategy, it’s about convenience, affordable and a certain amount of magic. Uber Pool tries to hold convenience at same level. You have two people taking similar route at same time. Both in car at same time, so the price goes way down.
We’re already doing 100k people in each city around the world every week. That’s exciting - that’s two cars becoming one. Our whole thing is about making Uber cheaper than owning a car. if we can make Uber cheaper than owning car, you don’t have parking problems, no more congestion, less pollution.
No more traffic?
This leads inevitably to a bold vision which Kalanick pitches as:
every car Uber-ized. The world would be a better place.
It’s a startling idea, albeit one rather undermined by a confusing claim that:
If every car in San Francisco was Uber, there would be no traffic.
Well, no traffic except for all the Uber cars presumably.
Of course, having disrupted the taxi industry and brought employment and revenues to thousands of drivers, Uber itself faces the prospect of being disrupted by the advent of driverless and autonomic vehicles. There would still be potential need for a service such as Uber, but not so much for the people. Kalanick is philosophical about this:
There’s a lot of promise in it. 30k people die in car accidents in the US. Driverless cars safer. Imagine if the price goes all the way down. Think about areas that don’t have public transit. Think of the good that comes out of this.
As a technology company you have to say am I going to be part of the future or resist it? We embrace the future. Is Uber in a place where we can help through that transition? It’s not going to happen any time soon, but there will need to be leadership within cities and within the type of companies who deliver this.
I don’t look at this as dark or light.
As the world goes robotic - everything in our world going robotic over next 20 years - I keep coming back to same theme - what’s the transition? What are the new things that we need to do?
In the meantime, there are still things to learn as a company. Uber’s had some bad press (some very bad press) about things ranging from sexual harassment, homophobic drivers and Uber execs threatening journalists. Kalanick’s argument here is that the firm needs to own more of its own messaging and not let others fill in the blanks:
As an engineer you make stuff. You let the work speak for itself. For most of Uber’s five year history, most of it we were doing that.
You have to learn how to tell your story. Let me tell you how this awesome.
Another area for attention is the need to create a particular culture at the company, one where work is something that is enjoyed and where staff give back to the wider community:
We’re in process of creating a philosophy of work. You spend half your day. You should want to do this. Celebrate your city - that’s a value for us. You have to have some heart. This is half of your life. The heart is about your purpose. It can’t just be about going to work.
Ultimately Kalanick didn’t actually buy into Benioff’s ‘Forest Gump’ moment of philosophy, but rather argued:
Life is not necessarily about choosing a destination. Life is more like a tour app. You press a button, then you’re up for going where it’s going.
We’re on the road, we’re driving, it’s a bit foggy, we don’t know where we’re going, but we’re psyched to be on the journey.
