Uber’s strive-talking chief executive Travis Kalanick made headlines again this week when he hired political heavyweight David Plouffe to be the ride-sharing app’s “field general” — to push the San Francisco company’s political and regulatory turf battles back at, and over, its more completely entrenched medallion taxi opponents.
Or, as Kalanick put it, against the “big taxi cartel.”
The CEO has always talked tough, and with Plouffe’s hiring, he is putting some muscle behind his rhetoric.
Plouffe ran Pres. Obama’s 2008 campaign and helped the inexperienced junior senator from Illinois steamroll over Hillary Clinton and then Sen. John McCain. He is, certainly, one of the most well-connected political animals in the country, and the Uber inference is that the well-financed taxi medallion crowd better watch out.
But don’t look for any political-type campaign victories here. Despite Kalanick’s bluster and Plouffe’s résumé, the taxi industry is no pantsuit-wearing opponent. For this campaign, Plouffe will have to be more Henry Kissinger than George Patton.
Look for a compromise. There’s too much money at stake for either side to fight to the death.
Five-year-old Uber raised $1.2 billion in June, putting its valuation at $18.2 billion. Its product is beloved by its users and its drivers average more than $90,000 a year. That’s a lot of value and a lot of good-paying jobs.
On the other side, thousands of immigrants for many generations have climbed into the middle class driving a hack. The value of each of the 5,569 individual medallions allotted in New York is just over $1 million, and while the value of the medallion has dipped slightly in recent months, it has still outperformed the S&P 500, giving middle-class drivers a nest egg.
Does Plouffe wanna mess with that?
Even the regulators need a deal, as they don’t want to rule-book thousands of jobs out of existence.
How successful Plouffe will be in threading this needle remains to be seen. But Kalanick showed some maturity and smarts in bringing in a professional to manage this fight.
There’s an expected Uber IPO on the horizon and way too much money to be made to leave this important battle to amateurs.