[inaudible conversations] i think we are going to go ahead and get started if you would like to take your seat. Welcome, everybody. Thank you for joining us here today. We are excited to spend the next 55 minutes with you. Im the cofounder and ceo of a start up im honored to be the moderator today. As many of you may have guessed, then theres rick is not here today. He got sick this morning and absolutely couldnt make it. We will talk a little bit about his book just for those of you that are wondering [inaudible] [laughter] [applause] we are going to leave time at the end forng audience qanda s well so please be thinking of your questions. We would love to have an interactive conversation with you. Im going to start by saying a couple of words about the book before we gos through a to mme and his book. For any of you that havent checked it outut yet it is billionaires and its the story of the claims from the facebook story. They were the two brothers at harvard who actually hired mark to help them build out their social Network Platform at harvard. Mark helped them build their platform but then he actually ended up kind of spinning away from them and creating his own platform so they made a claim they were entitled to some ownership from facebook because of the role they played and he said that they stole their idea and so they were kind of the vilified in the social network. They were made to look kind of snooty and arrogant and kind of a pain in the buck but in this s book the book starts with them getting getting their settlement from facebook from Mark Zuckerberg and how they used the money to invest. The end result is they become the first billionaires from bitcoin and a sort of narrowly escaped getting involved in some of the underworld with the silk road and its a really exciting and preque pretty cool adventurm the story of genius, betrayal and redemption. Theres a few layers of betrayal in the book but then they end up having the last laugh. Its a quick read and it will completely change your view of the winklevoss twins a few salsa social network. Andal he talked about that in te foreword how he felt he had something to do because the social network was based on his previous book so he said he wanted to show them in a new light. If you havent picked it up i highly recommend it. Its a great read and we are sorry you are not here. Hopefully you are watching on tv. Now we will do a deep dive into the battle for uber. Before that i want to share a little bit about mike with you. Hes a Technology Reporter for the New York Times and is based in San Francisco where he covers facebook, twitter, uber and a lot of the Silicon Valley giants. His coverage won him an award for business reporting, so rockstar Business Reporter here with us. We are excited to have you. Please join me in welcoming mike with this. [applause] my plan for the conversation is to kind of get an overview of the book for how awesome and interesting it is and then the implications for what he found for the story for the rest of the world so maybe if we could just start off if you could some people may not even really know what the story of uber is and then we can be dive into the pieces of it. How did you even get involved in writing this book lacks i think by now 2019 everybody has to have some knowledge of uber or how it operates in the world. Back when i started covering the company it was 2014, the New York Times and it was a moment ridesharing was becoming a thing but there were no laws or framework around it for people to know what to do with it so an entrepreneur was in some ways probably in archetype for i like to call him Mark Zuckerberg meets a can of ax body spray. [laughter] she found a loophole in the way people got around or didnt get around. In San Francisco in 2010, 2011 i was working at wired magazine and had to leave like 45 minutes early because i didnt know if a taxi would even come to get me and the Public Infrastructure was crumbling so if you can remember back when pushing a button onou your phone to ge gee car didnt exist this was pretty revolutionary at the time. When i decided to write this, it was kind of wanting to sketch out how entrepreneurs go about ideas and maybe the limits of t nhiping founders that break the rules and norms and how that can be a positive for change but also how it can go bad. Uber launched and everything was going awesome and then what happens . There were periods when most people i think they kind of know uber went through a hard time some people are like i know its bad but i dont know why and i enjoy using it. The arc of the company was in the iphone was just coming out and smart phones are becoming something everyone could use and applications that were like singlepurpose ab is to do all sorts of stuff were becoming populared and it resonated becae it was so easy to call a car to come and get to you. So the idea for travis was put as m much money into this idea s possible because we need to scale it back. We need to be in every city not just in the United States but around the w world because there is no barrier to entry like other people can replicate this and to do the same thing. They dont have the ability to protect their business so thats what they did is they raised billions of dollars and started pushing into every city as quickly as they could. Normal folks for the most part were charmed you could call him a car easily they were pushing completely passed regulators and probably breaking the law with regulators. Its the story of the rise and epic fall. The story ends with travis basically being ousted as the ceo. Its pretty dramatic. Its not like a Mark Zuckerberg tale where hes still the ceo. It has a a dark side. It is a uber book but its kind of where we are with Technology Coverage and where we view the impact on the world. From the late 90s through up until a few years ago tech coverage and reporting l this largely like revering coders eating a bowl of ramen noodles in a college dorm room. I think its changed. You can tell me but i think that narrative has changed and we are starting to see some of the dark side of how tech can operate whether its people getting assaulted and murdered in vehicles or manipulation of information on facebook and better and social networks and i think it is worth exploring the secondary effects that are not positive to understand them at least. I want to dive a little bit deeper into the conversation and have you startrt by painting moe of a picture on thisut for everyone to add to the conversation in the book of mike writes even when the founders were bending the rules and the law they were treated as platonic philosopher kings. Many believed they were remaking the world to get smarter, delivering a new and much improved version, and upgrade on life. Elsewhere in the few talk about travis and say that in the view entrepreneurs were worthy of the praise that they received. Can you start the story for everybody kind of who is this guy and what was his worldview and how did he see himself. Who was the person that predictecreatedthe culture of t . Right now there is what i would say i its an aggressively libertarian view of just sort of in the pure meritocracy people can build themselves up by their bootstraps and create the next Great Company. He had a similar path as other entrepreneurs, dropped out of ucla doing coding early on, was a serial entrepreneur of other startups that failed. A one of them is a Prototype Version of like napster and he got sued for record of a billion dollars or something and that didnt end well and then he did another company but he only made like a Million Dollars on that which made him like middleclass in Silicon Valley i guess. So by the time he got to uber, hshe had a little bit of a chip on his shoulder. Hed been betrayed by some of his investors at earlier startups but still wanted to prove that he could build the next great thing. Also post financial crisis right around that time so Interest Rates were dropping, capital was flowing into the money a lot more and archives were becoming somewhat more easy to build itself a lot of things have to happen at once to make uber have been limited. The access to the web services that make the need for startups to kind of get up and go on theirto own and then just insane amounts of money given out to the founders. We will talk about that. You portray him as someone that has a lot of ambition and a competitive side that what you havent really touched on is the kind of immaturity she exemplified as a 40 plus year old woman reading this book i am like this is like a man away. The parties and inappropriate behavior. One of the things that exemplify that in the book is where you y contrasted amazons leadership principle with Company Values that travis created. Can you tell everybody a little bit about that . Amazon like most companies have principles or guiding leprinciple philosophies. Amazon is something that uber, travis was obsessed with, he wanted to sort of creeps b12 in amazons image. Image. They have 14 corporate values like customer obsession, fairly benign [inaudible] traviss version of that was to avfrun it through a speak translation engines pick something out. Some of them were always be hustlin. Be an owner, not a renter. Champion mindset, winning which was a Charlie Sheen thing that he opted for himself, but my favorite one was super pumped. As a company value. [laughter] something they use use to evaluate employees on and higher employee. Hr people would sort of markup your level of how pumped you are to see if you are doing a good job which i dont know how you measure about but tha that that, he was just kind of a grown man child given billions of dollars to build a company in his image and i try to be fair there was value and he did create this enormous company that changed transportation works entirelyha but also there were no boundaries on how he did that or what his behavior was like because everyone attached would heres another quote from the book. Iit would take an extra of thoms hobbes, animal house and wolf of wall street. This toxic startup culture was the result of a young leader surrounded by yes men being given unlimited Financial Resources operating without serious ethical or legal oversight they struggled for power and is a primacy over a multibillionr dollar empire. Concepts like breaking the law were not applicable he be believed when the walls were bs in the first place. Can you give a couple of examples like i was really shocked by the things they were doing with the policehe and pubc servants they were messing with apps in their phones so that Law Enforcement officials couldnt catch then drivers. One of the interesting parts of the book does anyone here know what the word gray ball means . If you remember in 2014, like uberub now is a given, people cn get off the plane and look for one. 2014 when they were expanding cities there was no Legal Framework for any of this and they didnt know what to do. In austin there is a battle people were put off by the way they came in an aggressively and put up billboards that was kind of fostering that they knew better and they should be here. They had battles wit have battll transportation officials and Law Enforcement that were trying to stop them from coming in. Import when i open a book with a scene in portland where the transportation folks are like if you come y in here we are goingo arstart calling your drivers ovr and giving your tickets too sort of stop this like we are not messing around. The response to that was they hired a corporate espionage force csa contractors to follow transportation officials around him to sort of figure out in some cases where they lived or what their credit card numbers were were different ways to attach them to their apps and what they did they code named its gray ball anklets think you were a transportation official trying to call uber you hit the button into the car might say that its on the way and immediately canceled. Fullstom working or maybe it shows the service is too busy and no one can come. So they are not able to catch any of them and the plan worked so well because the city had no idea this was happening to uber decided to create a playbook and improve internal website to teach the rest of their employees how to do this and spread it across the world. When we reported on this in 2017, and a glut of engineers in the valley would like this is a creative solution to the problem. And a lot of lawyers i talked to her like thats probably obstruction of justice. But thats the sort of thing they believe that the walls were written unjustly or mobilized to benefit so they were acting out of the value number six which was principled competition. There were principles behind it even if you didnt quite agree with what they were. By the end of the day they were spearheading the revolution in transportation in the industry eathat was dominated and it woud sort of be brushed under the r rug. There is a legitimate argument to people in the industry that this is kind of here now. Theres a lot of people in Silicon Valley who will say about this is sometimes you have to push through even at the cost of whatever ticket to a better hplace. I dont know if i agree with all that. One of the questions for all of us anytime you have a Major Business innovation that could be in a gray zone thats the Financial Service crisis. They turned out to be harmful so there is another level and another layer thats how women were treated and it wasnt just the employees, it was actually the entire company culture. A lot of the parties that you write about in the book feature when then brought in as actually in one party as auction items. Can you talk a little bit and then the interesting thing is the turning point when things start going down is an open letter written by a former female engineer about her experience. Can you talk a little bit aboutl the role of the letter and the Tipping Point when they started to freefall. They were on the bleeding edge of the movements that are going toto materialize. They raised 3. 5 billion from the Saudi Public Investment Fund and continue raising because mutual funds were ready to give them as much as they can answer that resulted in 2015 they spent 25 million sliding everyone else to have a huge party and must take us in the desert where they hired beyonce to perform privately for 6 million in equity i think it made it into song lyrics and album if you look at one of the last songs on the last album theres something about equity and thats hreferencing that uber deal. We want you to pick the numbers and grow your division and office anin theoffice and then f turn a blind eye to the on the first day on the Engineering Team by the manager and it was just a real culture because it didnt matter what you did as long as you make your numbers. They had a lot of internal struggles. The whole philosophy is we are not going to build a department that works or some things that make it a little too corporate and maybe that was positive in some ways but also played out in a lot of negative ways. The phrase meant Sexual Harassment policies from the misconduct of the reporting procedures and reviews and all things that are hard charging young man rolled his eyes. It would be the board and the investors that had billions of dollars into this company and ended up being a very significant player. They are the oness that ousted him that for a long time they let this stuff go on. Maybe we can just start by talking about what that was in Silicon Valley where they would tolerate this and turnha a blind eye. So, ideally in a non dysfunctional company you have Board Members who support the ceo and challenge the ceos like the board is supposed to maximize the value and not violated their fiduciary dutiess about things like oversight of the company. The way that travis designed guber was essentially to have a service for his pleasure and he was unable to be removed from the ceo seat through slow changes to how he raised money for the terms of his financing and how the structure of the company worked. I think for a long time people didnt want to look too hard at how things wereus going. In 2012 or 201 2013 and was vald at 3 billion had been just like two to three years later it was valued at 40 billion then by 2017 and end of 201 2016 it wast almost 70 billion which was the most in same. Aninsane. And nonprofitable. Burning billions of recorder. If anyone here is interested enough another train wreck business study you should look up what is happening right now because it is the most insane anstory that ive ever seen. This book is like a precursor to all of that. But i think their incentive was im going to make you rich so just dont Pay Attention to all of that. And hes from benchmark capital and there is an interesting profile of him in the buck and he is trying to make his mark so from the venture capitalist perspective, they want to be the one that finds the next unicorn come in the next facebook, so hes kind of egging him on edit in the beginning and then later on its like no, what have i created and also for fear of his own reputation hes the one that starts leaving the syndicate ouster because hes afraid this is going to blow up and its all going to look down on me. Thats right. And i think that in dc culture and trying to pick the winners of the whole thing about being a venture capitalist is not defined Small Companies that will grow into huge things and you dont just want to double your investment, you want to like ten or 20 x. That is how they work it is high risk and high reward and so once you do that and it seems to be for a very long time like a very sureu bet and enormously lucrative for a lot of people it is hard to suddenly come in and interv