By Parag Deulgaonkar and Michael Jabri-Pickett
In an exclusive interview with Arabian Business, the CEO reveals how he gave 40,000 Saudis jobs, and what makes Dubai the perfect blueprint for the GCC
Travis Kalanick has it all worked out. Just ask him. He sees the future, and what it looks like is pretty different from what most people experience every day. Not surprisingly, it all starts with Uber.
With a ride-sharing system, says the 40-year-old bachelor and CEO of the transportation company that has gained global notoriety, one car can be shared by 30 people.
“The cost of that kind of service can get so low that it’s cheaper than owning a car, and when it’s cheaper, more reliable and higher quality than owning a car then people don’t own cars anymore, and when people don’t own cars anymore then you rid the streets of traffic, you rid the air of pollution, you make the roads safer and you create tens of thousands of jobs in each city where you do it,” he says.
In one run-on sentence, Kalanick moves from customers using an app to less congestion, cleaner air and more jobs. But this is exactly how the native Californian operates. Much like his drivers, he is always on the go and refuses to slow down.
In an 18-minute exclusive interview that has been rescheduled three times and finally starts a little after 4pm, Arabian Business sits down with Kalanick on the eve of Valentine’s Day in the lobby of his hotel, the Jumeirah Al Naseem, 600 metres from the Burj Al Arab.
With an incredibly full head of hair that will – no doubt – stay with him long after it has gone white, Kalanick touches upon a range of subjects while remaining irritated by the frequently opening and closing door a few metres from where he sits drinking his bottled water.
Kalanick has flown in from San Francisco, landing in Dubai early in the morning and flying out that night, spending less than 24 hours in the UAE. He is in town for the World Government Summit. Not surprisingly, he took an Uber from the airport to his hotel in Dubai (standard operating procedure, his accompanying public relations representative says).
Kalanick is happy to discuss with Arabian Business local rival Careem, as well as passenger safety, jobs in Saudi Arabia and what’s next for the eight-year-old company with revenues of $1.5bn and 6,700 employees.
He claims Uber is number one in the Middle East, but he knows the company and its drivers cannot afford to rest on its reputation.
“There is a huge amount of opportunity in the Middle East and if you look at the cities here, they are big cities and often dense cities that have a lot of people. From Saudi Arabia to Egypt we feel pretty good about our relationships with city governments across the region as well as, in some cases, national governments,” he says.
Steering the conversation to Dubai, Kalanick says Uber plans to roll out an economy service called UberX in the emirate.
The service is part of a cooperation agreement that Uber signed in January 2017 with Dubai’s Roads and Transport Authority to study potential new products to support Dubai Vision 2021.
Uber, estimated to be valued at over $60bn, and Careem, valued at $1bn, had been barred from offering economical services in Dubai as regulations required their fares to be 30 percent higher than traditional taxis.
“We are making sure that [residents] have an affordable way to get around in the city,” Kalanick says.
“The lower cost of service actually becomes more luxurious because when you have more people who can afford it, more people use it, and [when] more people use it, you have more cars on the system. Then you have better pick up time, more reliability and accessibility across the larger part of the city.”
But UAE capital Abu Dhabi will not be one of the more than 500 cities in which Uber operates. Company officials told Arabian Business last week it will not restart services until the “current licensing regulations in the emirate are eased”.
Uber and Careem both suspended their operations in August 2016, although Careem resumed its Limo operations this month.
Regardless, the key target for Uber appears to be Dubai. It’s a smart move given the emirate wants 25 percent of all transportation trips to be smart and driverless by 2030, projecting economic revenues and savings of up to $6bn a year.
Kalanick says Dubai is embracing progress and mobility, and is the template upon which other cities can be based.
“We are obviously very much excited about that. What we are doing in Dubai is a model for other cities in the region, and we hope that can be instructive for other regulators and other political leaders that are looking to bring innovation into their cities,” he says.
Kalanick says he sees Uber’s success being as simple as water, which – on the surface – does not seem to be a natural analogy.
“I think our mission is [making] transportation as reliable as running water everywhere, and for everyone. So making sure that this service and transportation service – where you can push a button and a car magically appears – takes you where you want to go. And when you say everyone that means it must be affordable. Everyone should be able to afford it.”
Which means the company’s philosophy is the opposite of the two lines oft-quoted from Samuel Taylor Coleridge’s The Rime of the Ancient Mariner: “Water, water, everywhere, Nor any drop to drink”. If Uber drivers are water everywhere, then the public will be able to drink as often as it wants, and wherever it wants.
A service that is so comprehensive can only support the local economy, and what Uber is rolling out in Dubai is the blueprint for the GCC and the broader Middle East.
Examining Uber in more general terms, Kalanick speaks about cars, cities and drivers with the sensibilities of a computer programmer, which, of course, he is.
In a city, he says, there are a limited number of cars that participate in some kind of ride-sharing service, and that limits the opportunity for people to get around town.
“Usually it forces people to own cars, which get used 4 percent of the day, which means 96 percent of the time they sit idle in a parking lot or on the side of the road. Also, 20 percent of the land in the city is used to store these cars that are not being used. So the city just opens up when you use cars more efficiently,” he says.
“I like to say the city can breathe and it is not just because you have more space or more green area – it also means cleaner air, too.”
Kalanick does not see Uber as just a service with great potential in the UAE, he also recognises the opportunities to help grow the economies of the six oil-dependent GCC countries.
At the end of November, Prince Alwaleed bin Talal used Twitter to say it was time for Saudi Arabia to look at the economic costs of women not driving, and of so many expats chauffeuring women around the country. Kalanick does not speak in such specific terms, but he does see his company as helping to employ Saudis and, therefore, eliminating the need for so many foreign drivers in the kingdom.
“I think job opportunities can make the entire economy better, and those job opportunities can be had by folks … who are citizens, and we feel great about that,” Kalanick says.
“So like in Riyadh, for instance, or Saudi Arabia in general, 70 percent of the drivers that we have … are citizens or Saudi nationals, and that is over 40,000 drivers. It’s actually 40,000 jobs that we have created for Saudi locals.
“So we are all about making a mobility service that works for citizens for riding, but also one that creates economic liberty for people who are looking for ways of making a living.”
But the challenges might still be daunting for someone less focused and less – pardon the pun – driven. Kalanick sees the advantages of Uber as a service for the everyman.
“Uber is about serving the many and not just a few.”
Just like any successful venture operating globally in a hyper-connected 2017, Uber and Kalanick are not without stiff competition. Aside from the sea of taxis in Dubai, Uber also must deal with Careem and its local knowledge.
“Careem and us are both working hard to serve riders and drivers. But I think it is pretty clear that Uber is … the gold standard out here in the Middle East. But we have to earn that every day,” Kalanick says.
No shrinking violet, he points out a much-bypassed fact about the five-year-old, Dubai-based start-up.
“Our teams that run Uber in the Middle East are the sons and daughters of the cities that they serve, and you know that one of the founders of Careem is a Swede, so I am not sure if he is more local than our guys, to be honest. But look, I think at the end of the day it’s about serving the customer.”
While his critics have charged the service is not as safe as it could be (there have been reports in the US, India and the UK in the past few years of women passengers being attacked by Uber drivers, for instance), Kalanick talks about what his company has done to ensure customers are safe.
“The technology that Uber brings to mobility is inherently safer than what came before it. Drivers are screened before they get onto the system, we have GPS tracking of trips, riders can share live tracking of their trips with their friends and family. If there are any issues with your experience for whatever reason, you can let us know and we use that feedback, whether it be star ratings about that driver or comments about the experience.”
Kalanick says drivers who are not safe are taken out of the system.
“Our ultimate goal … is to make Uber the safest place. To make Uber the safest place in the city.”
The company, Kalanick says, now runs an app with every driver.
“The sensors in the phone can tell how that phone is moving. You can tell acceleration and deceleration and how the car is turning and we can see unsafe patterns. There is a whole bunch of features that we are looking at and we will be rolling out in the coming months and years and we are really excited.”
As is his style, Kalanick is always looking ahead, seeing potential with each of the 70 countries and more than 500 cities where Uber is in service. So what is next for the company founded in the aftermath of the 2008-09 financial crisis?
“We want to make sure that we are serving riders and drivers best in the city. And if we believe that we serve riders and drivers best then you get it all,” he says.
“If you serve all the customers best then you get all the customers, and if you just focus on delivering a great service and innovating then I think the growth and business follows.”
Words to help drive any business.