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The story of Bradley Tusk is now well known. Tusk quickly turned the bonus of his powerful boss into an opportunity that most people can only dream of. He started his own business to help his clients navigate the troubled waters of regulation. One of his first calls came from Uber. What paid for it in stock.
Tusk has since used some of this wealth to create many other businesses, including venture capital firm Tusk Ventures, which has new, brighter stakes, such as stakes in the Bird electric scooter company, the company's Lemonade Insurance and the Eaze cannabis delivery start-up.
After returning from a New York Met match, Tusk today asked for his opinion on Uber's IPO, his expectations for tomorrow and the times when he best remembered his work with the company, who is now 10 years old.
TC: Your Uber shares have skyrocketed over the years. You said you were seeking to withdraw a large part of your stake when SoftBank acquired 15% of the company last year. Do you sell the rest tomorrow?
BT: I'm still stuck, but when it's over, I'll sell that makes sense.
TC: Uber would offer 180 million shares at $ 44 or $ 50 in its public debut, meaning its valuation could exceed $ 91.5 billion. What is the importance of pricing IPOs?
BT: On the one hand, that's all because you put a subjective number in some ways, and if it works, you work [as a banker] and if it is not, you do not do it. This is the moment of truth in some respects.
But if you decide, I would prefer [the offering] 10% less, as this will result in a 20% increase [right away]It's not an unreasonable strategy, and as a person who has to wait six months, it does not bother me at all.
TC: Regarding Uber's main platform and its "other bets", where do you expect to grow the most?
BT: I would say the other things for two reasons. First, Uber Freight could be reduced to a group of verticals other than logistics for trucking. I also think that Uber being Uber, they will come up with something we do not know yet, as they have already done three times. And when they do, it will represent a lot of growth.
TC: Uber last month transferred some of the autonomous car development costs to outside investors Toyota, Denso and SoftBank. Was it the right choice? At one point, it seemed that Dara Khosrowshahi was planning to sell the company in its own right.
BT: Yes, because I think that autonomy is no longer seen as a market where the first [mover] wins. People understand more segments and problems and the cost of development is higher than anyone would have expected. Autonomous vehicles will be developed in different ways by different people and [these players] will all add partners, spread risk and provide additional resources. . .
TC: And will they work closely with the cities? Can Uber gain traction with its self-driving technologies if it does not? Can one of these companies?
BT: On one side, Uber has more experience in dealing with municipal authorities than anyone working on autonomous vehicles and that counts for something. We saw what happened when Amazon tried to deal with local politics in New York.
Once you have evolved, I think you will have federal pre-emption. It's one thing for every city and state to set their own traffic rules, but if we're in a moment where some cars are self-sufficient, others are, and where we have arbitrary differences – let's say you realize that you are in New Jersey and so have your hands on the wheel – [it’ll be a mess]. If Congress was rational, functional, deliberate [governing body], it would be [start figuring this out].
TC: Assuming no, how much does it slow down these efforts?
BT: If this is not the case, this is where the concept of relations with cities and states comes in. The disadvantage is even if you had everyone [in local government] work with you, the chances that they adopt the same rules [across cities and states] seems unlikely, but these companies may have to succeed, at least as reinforcements.
TC: Have you kept in touch with Travis?
BT: Yes
TC: What do you think of his current plans to turn more empty or underutilized real estate into places offering on-demand services, such as fully equipped kitchens that restaurants can use to meet the demand for dishes to take away
BT: I think it's really interesting, especially in the food sector, where these two trends are evolving at the same time. First, people do not seem to want to cook as much as before, and I think it's a profound change in society, not a fad or a rap. In addition, the margins of the restaurants are very low and the cost of operating the restaurants is very high. So, I think what we'll see are more restaurants that see a physical restaurant as a branding exercise, a loss manager that helps them make a name for themselves – so they'll make money on delivery.
TC: Do you also invest in this type of business?
BAT: I do not think Travis collects money, as I understand it. [Laughs.] But I guess at some point we'll be working with Travis one way or another.
TC: Lyft and Uber use different methodologies to account for "active riders". Uber defines it as a single consumer who completes a ride, rents a scooter or has a Uber Eats meal delivered at least once a month, and then averages that number of monthly users for the quarter. Lyft, who of course still does not have a food delivery service, simply defines active runners as all runners who do at least one ride on his platform for a quarter. What better representation of the commitment, in your opinion?
BT: You could say that Lyft is now the place where you would expect a public company, where you say it's the [total addressable market]. Once a company is public, it's much more, it's our profit, so our performance has affected our turnover. You could argue that Lyft is where Uber might have to go [in terms of how it calculates this figure].
TC: The drivers use both applications, the drivers use them. Have you ever seen these companies merge? As you may remember, they spoke in 2014, confirmed Travis in an interview in 2016, but he said that the price discrepancies ultimately doomed the deal to failure.
BT: I do not even know if they could get FTC approval if you add up their collective share in the carpool market. And now that they are both publicly traded companies, the ability to challenge them will be more difficult unless Waymo or another Robo company takes away market share.
TC: Do you see Uber making money at any one time?
TC: Yeah. I think this can be the result of more and more carpool partnerships in different markets. I also think they will be able to use the Uber Eats and Uber Freight concepts and continue to take advantage of them. Eats enters for example in the delivery of parcels. If all these things materialize, Uber will be profitable.
TC: How many years have you advised Uber?
BT: I started in 2011 and finished in 2015.
TC: What are you most proud of?
BT: Even more than a particular market – we ended up winning everywhere in the United States – it's this idea that if you give people a very easy way to defend themselves, they'll get involved. The idea that everyone is apathetic is not really true, and we used it to fight taxis everywhere, including when Uber was not a valuable company and we were tackling the problem. [much-deeper-pocketed] taxi industry.
Our thesis was right and the whole performance worked, and that's really one of the ideas that drive the work I'm doing on mobile voting. I'm baduming that if you increase participation by making it easier and more practical to engage people in the process, politicians will change their behavior.
TC: Travis Kalanick is obviously a strong leader and apparently stubborn too. A suggestion that you made to him and that he has not made yet could have changed things for society in a potentially significant way.
BT: That was not his case, but I suggested a few years ago that Uber offers benefits to all drivers. At the time, there was not much optimism, but I think the world is moving in that direction anyway, and I think they could have saved money by having a churn less than they had, and in their optics and reputation.
TC: You have a lot of promising bets in your wallet right now. Do you think that one or the other of these companies is approaching the size of Uber or is it about a company of the same kind as a company? times per decade?
BT: I think something can. I hope something in my wallet at will. I think every VC will tell you that every day they see offers with [total addressable markets] in the low trillions. The number of companies that can convert this into a business figure [and reach an Uber-like valuation] is rare, but someone will succeed, in some areas.
TC: The company is coming soon to the market. What are you doing to celebrate?
BT: When I sold some of my shares to SoftBank – almost half – psychologically, this had an impact [that I would otherwise experience tomorrow]. You know, we were able to take advantage of this thing. Everything I wanted to do could then happen. So it's not that it's not a big deal. I just think it would be ten times more anguish than it does not happen.
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