We have been here before. A decade ago, wall street was riding high and producing dazzling booms and scandals. How do we make sense of what is going on in the tech world . Is the tech bubble about to burst . Joining me is max chafkin who is a writer for Bloomberg Businessweek who has been covering uber. President of a Global Communications firm, and william cohan, a contributor to vanity fair and author of why wall street matters. I am very pleased to have them all at the table. Max, i would like to start with you. One of the things that put uber in the spotlight is this extraordinarily video of released of travis in a cab arguing with an uber driver. This comes on top of the scandal when a female employee wrote a blog saying it is a sexist place to work. It is a combination of a pr nightmare for the company. Max it has been an extraordinary month for uber. You did not mention the delete uber campaign. That started in january. This video came to our beat reporter, eric newcomer, it was passed to him by a driver. It is clearly a dash cam video of Travis Kalanick, the c. E. O. Of uber, getting into a spirited debate with a driver. It kind of reminds me of the joe the plumber video where you have a lot of uber drivers who have long felt the company does not always have their best interests in mind and you have a driver suddenly voicing those concerns and being treated in a dismissive way. Gillian one of the reasons this story is so fascinating is all these ridehailing apps is embedded in almost all of our lives these days. I could not survive without these apps. And yet as you say, there is so much controversy about the way the company is being run. What do you think this shows about the Company Culture and in particular about the personality of travis . Max i would argue it is all tied up. One reason uber has been very successful as they have been able to overcome opposition from taxi industry lobbyists and unions. In a lot of cities, the taxi industry is heavily regulated and they have adopted an aggressive approach. Unbelievably focused on growth at all costs. When you look at the Sexual Harassment thing, you have a company and i dont know exactly what is going on inside the company. But when you talk to people there, you have a company singularly focused on growth to the point i do not think they cared about anything other than hiring a lot of people very quickly. The whole function of h. R. At a place like uber is hiring. It is not making sure bosses are behaving appropriately. It is not policing these things. Unfortunately, that comes from the top. Some of that is on the c. E. O. And from the senior managers and board of directors. Gillian you have this crazy hubris. You have a lot of money swirling around. You people so busy doing their jobs they get disconnected from the real world. It sounds a bit familiar to me. Bill, you have spent the last few years looking at crazy behavior on wall street. What do you make of this . William this is a classic narrative arc to me. One thing we like to do, the Business Press loves to find these darlings like travis or mr. Snapchat and sort of build them up, make them seem almost mythological. Make them seem largerthanlife. We like to build them up and build them up. Part of the reason the uber story has gone viral is because it has a 70 billion valuation. It is a private company. I would argue, and we had this discussion last year talking about the new establishment list and everyone was saying how great travis is and we have to put him at number one. I said this is a taxi company. We are valuing a taxi company at 70 million. Gillian it is something we all use. William it is still just a taxi company. Everyone was saying it is much more than a taxi company. You dont understand it is the , way we will have everything delivered. I think we have priced for the jetsons. I think when you begin to say travis is a regular guy, it is kind of like a taxi company. And here he is in the back of a taxi abusing a driver. The Sexual Harassment blog was stunning. As soon as i read it, i knew. Gillian one of the former uber employees who was a Software Engineer talks in detail about how she was 3 of the employees were women and they were subjected to extraordinary treatment. Max she would report it to h. R. And h. R. Did nothing. Gillian this sounds so reminiscent of the Banking Center a deacde ago. Is tech the new Banking Sector . William it certainly has become a darling like the Banking Sector was in terms of people coming out of graduate schools wanting to go in the tech sector. They do not want to work Investment Banking anymore. Even reporters do not want to cover Investment Banking. They want to cover the tech sector. Gillian you are in the hot seat, congratulations. Richard, your job is to go around firefighting and deal with companies that have messed up spectacularly. You dont represent uber. If you were advising travis right now, what would you recommend he does . He came out with this extraordinary statement which was in my mind in some ways encouraging. He said he needed leadership lessons. He said he needed to grow up. Like the rest of the tech sector. Do you think that is the right approach for a c. E. O. To take right now . Richard i think he was really smart in trying to staunch the bleeding and apologize wholeheartedly without reservation. He was very clear that he had messed up and that he had a lot of work to do. I think there is much more to play out here. I think max is correct. The Sexual Harassment initiative Arianna Huffington and the former attorney general are leading is deeply important for the company to get done. Theres a special investigation by these two outsiders brought into basically fix the culture. She is helping to lead it with holder as an outside counsel. I think it will be a fundamental look at, do we have a problem . If so, what are we going to do about it . Further, i think travis has to establish himself as a person who accepts he is running a big company and he is not just an entrepreneur anymore. This arc has been followed by many in a successful way. I look at a person who actually started steve jobs and others matured over time in the c. E. O. Job and made significant strides. Hopefully, travis can do that. Gillian you have a survey that comes out once a year which looks at the level of trust amongst people in 18 Different Countries in different business sectors. The reason i first noticed that is because i used to write about the Banking Sector. Unsurprisingly, trust in banking completely collapsed after the financial crisis. What was amazing to my mind is trust amongst consumers in the Technology Sector has stayed skyhigh. These guys have been like gods. Do you think that is dangerous . Do you think we will see a cracking of that skyhigh trust as a result of these scandals . The Tech Industry has benefited from cellphones and other sorts of products people use every day that continue to somehow be affordable and the sense that somehow they are good employers. The idea somehow that they are not good employers gets around, that is really corrosive. The idea somehow that c. E. O. s are entitled, really problematic. You will remember from the data, a huge drop in trust in c. E. O. s this year across every one of the 28 countries we did the work in. C. E. O. s are down there with government officials. A great place to be. Gillian i think journalists are even lower. Richard in fact, the opportunity for technology is substantial. You have people interested in health care or sustainable cities. I think the arc is different to technology. I wanted to disagree with bill slightly. I think there is a record here. Ebay have made substantial philanthropic bill gates also and have been activists in the foundation world. Gillian they can try to buy their way into a halo. Having seen wall street go from god to devil, to becoming everyones favorite pinata if you are a politician, do you think that could happen with tech . If you were running your own massive p. R. Company, what would you be advising Technology Companies do . I think there is a chance it happens with tech. It is because of this arc of the narrative. I think we, regardless of the industry, i think we like to build up these titans of industry. When they stumble, we like to tear them down. Once it is not a great place to work anymore, everybody is flocking to tech because they perceive it to be like google plex. Free food all day long. You can take your skateboard with your computer and go to your little nook. If you want to take a nap, you can take a nap. It seems fabulous. It seems fabulist. I think a lot of people on wall street who were forced to work really long hours, and i have written stories about people on wall street who committed suicide because of the long hours, wall street between the financial crisis and long hours has gotten a very Bad Reputation which they have not been able to dig themselves out of. If that arc begins to change for tech, i think you are going to see it is interesting. Mbas, graduates of our leading universities vote with their feet very quickly. They are like traders in that regard. They will go into a hot industry when it is sexy and exciting. When stacy once they see a crack or it is not giving them the image they want for themselves, they immediately go to something else. Gillian max, im curious because you cover the tech sector and not just uber. All of this is happening as we have had ipos with crazy valuations. It sounds like 2000 all over again. The amazing thing about the snap ipo today is we have come out with a price of 50 on the first day. Snaps business is not growing that fast. It is threatened by other rivals and is not giving its shareholders any voice. Max i think it is important we are comparing tech today to tech in 2000 or banking to look at are these Companies Creating value for consumers. That is one thing getting lost here. You brought it up. People really like uber. Their numbers are increasing every week. Branding problems aside, a business like that has value. Snapchat, yes, we can make fun of it. It is sort of silly, but teenagers and people in their 20s are spending enormous amounts of time with this app. It is one we may not totally understand as older folks, but it is getting a lot of attention at a time when Mainstream Media companies are struggling. You look at what espn is going through, what some of the News Networks are going through, they are struggling to find younger users. Not just younger users who will click on a link but sit in front of it for hours at a time. When people are paying skyhigh valuations for snapchat stock, that is what they are banking on. They think this is television and snapchat owns television. Gillian that is a great point. As a parent, i do not feel like value to the much world. You make a good point because clearly these businesses are thriving now. Back to uber, one thing interesting about the video that caused this scandal or todays or yesterdays scandal is a conversation travis had with the driver. He said we are not dropping the price on black. Then the taxi driver says yes. He goes on and says we have competitors. If we did not drop prices, we would be out of business. In my mind, that is an interesting wrinkle. It suggests maybe this uber miracle is not so miraculous after all and is more fragile than we realize. Max i think he is right. I think he realizes it is fragile. I think a lot of people who see the skyhigh valuations do not understand it is easy for consumers to move from uber to one of these other startups trying to build companies on top of ubers driver network. The thing that is even scarier if you are sitting where travis is sitting, it is easy for drivers to move. If you get into an uber today, you will notice they have two or three smartphones for different apps. Because ubers model is attractive to investors because these drivers are not employees, they are contractors, uber cannot tell them went to work or not. But that is a double edged sword because they can leave at any time. They can twotime uber as much as they want. Because so many investors have poured money into ubers competitors, those companies are able to subsidize payments to drivers. Uber is in a box even though it has enormous valuation. I have found uber drivers will badmouth uber and tell you youre better off if you use get or lyft. Gillian you have actually had people say dont use uber . An uber driver said you this is not the reservist. You should use get or lyft. To your point, these companies, snap inc. , uber, they are like networks. They have a lot of eyeballs now. They have a lot of people engaging with them. I think there is a lot of value to that. I dont understand the valuations. 70 billion for uber. To me, is just a taxi company. Gillian one of the interesting angles about this whole thing is the question of Sexual Harassment and the climate for women in Silicon Valley. By the way, i think it is fabulous we have three men talking about this because i think most of the time it is women talking about womens issues and it needs to be a joint conversation. But if you believe companies have to work hard to hang onto employees, one of the most interesting things right now is we are about half a Million People short of employees in america now, stem employees. At the same time, there are only 70 or 80 women in Computer Sciences in america. One question is, is there any way to make these cultures in Silicon Valley less macho . People talk about the bro grammers culture. How do you get women into Silicon Valley. Richard you dont do it if you with susan. Gillian the employee of uber. Richard happy to be an engineer, assigned to a group at uber she was happy about, and then basically mistreated miserably. Unfortunately, wall street does that same thing or has a history of doing that same thing. Gillian they come out with this p. R. Glossing that we love women. And then dont do anything about it. Richard how many women are on wall street . It is an infinitesimally small number. Gillian is it generally worse in Silicon Valley, do you think . Richard i think it is probably better in Silicon Valley. It seems like culturally it is a more forgiving you can have more flexible hours. You can work from home. You can do those things more helpful to women if they choose to be that way. On wall street, i remember when we got the first woman. Why do we have to have a woman . There was one woman who was a banker. Somebody suggested another woman. The edict came from down on high saying, why do we need a second woman . We have one already. [laughter] gillian i have been there. What do you think, max . You cover these companies. You do get some women at the top like sheryl sandberg. You do get people joining the company at the bottom. What happens in the middle in terms of the lack of women . Max it is interesting. To bills point, if you pull the average Silicon Valley worker aside and poll them about gender, they believe in equality of pay and basically are horrified by the allegations in the blog post. But as a whole, because these companies are not super sophisticated in hiring, you end up with a culture overwhelmingly male. There are all sorts of interesting ways Silicon Valley investors talk. One is that they talk about pattern matching, where you try to squint at a company like, you like like facebook. , and you look at another company like snapchat and see if they are similar. That pattern matching thing is basically discrimination. That is what that is. I think that is the cultural thing that is more insidious than the general broeyness of Silicon Valley. If you have a 70 billion market cap, and you are proclaiming your h. R. Department is only in the business of hiring and not providing help to women in rooting out this bad behavior, i just dont get that. Max i think uber especially, but a lot of Silicon ValleyCompanies Value description. That gets thrown around a lot, but uber is a big company that was not acting like a big company. It was acting like a startup. In a startup, you do not care about the possibility of getting sued for Sexual Harassment. If youre thinking very hard headedly. All you care about the survivint the next six months or 12 months. That is insidious no matter what. It is superinsidious when we are talking about a company that employs thousands of people. They, for what ever reason, because their investors did not demand it or was not able to get to the top were not able to get , there. Gillian when travis says i need to grow up, he needs to grow not just as a human being, his Company Needs to grow up. He needs to recognize he is managing a big company. The tech sector as a whole needs to grow up if you like. Im curious, richard. You are in the business of dealing with nightmare problems. What do you do about the women in Silicon Valley . Richard i think the women in Silicon Valley are part of a bigger exercise for the Tech Industry. This is the industry that in my mind is going to get at the greatest risk from President Trump. It has the biggest challenge on supply chain, immigration, lgbt. Gillian in what way . Richard in a certain way, the workforce is deeply diverse, deeply global. The supply chains are deeply global. They do not base their business on a made in america kind of label. They have to sell in china, mexico, and make sure their data is secure in tho