Uber’s $100b IPO


Published April 12th, 2019 - 04.12.1981


David Streitfeld has a great story in the NYT this morning about life as an Uber driver and the vast distance between what drivers earn and what investors will reap from the firm’s public offering. Drivers: $40,000 in a good year of full time work. Investors: numbers that end in “million” and “billion.”

Travis Kalanick himself made $1.4 billion when he sold about 1/3 of his Uber shares to private investors two years ago. The Wall Street Journal estimates that Kalanick’s remaining share will be worth $6 billion. Uber co-founder Garrett Camp is looking at $4.5 billion. Logan Green, the CEO of Lyft, has a $623 million stake in that company.

These numbers are so big that it’s actually quite difficult to understand them. Here’s one way to think about it: It would take a driver more than 15,000 years – driving full time – to earn what Green did. It would take 150,000 years to get to Kalanick’s take.

These numbers and the story Streitfeld shares tell us a lot about the injustice of the gig economy.  They should also serve as a permanent backdrop to any discussion of whether Uber (and Lyft) can afford to treat drivers as employees. Can a firm, whose CEO takes away $623 million dollars, really not afford to provide unemployment insurance or workers compensation to its drivers? These arguments have always seemed implausible. Now they are downright absurd.

 

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