As Uber IPO Fails, CEO Tries to Boost Morale

As Uber’s IPO Fails, CEO Tries to Boost Morale

As Uber IPO Fails, CEO Tries to Boost Morale

Last week, after months of preparation, Uber became a public company. However, in a surprising turn of events, the most anticipated IPO of became a historically terrible IPO.

Last Friday was Uber’s first day in the stock market with a starting share price of $42 – already three dollars below its IPO price. Throughout the day, the stock continued to slide, ending at $41.70. In the process, investors lost a record $655 million, with the Saudi Arabian Public Investment Fund taking one of the most substantial hits ($201.5 million).

There are many reasons for the IPO’s failure – the company’s slim margins, operating losses running in billions of dollars and most importantly, the company’s brand image. The Uber brand has consistently been the center of controversy – from multiple legal battles to its revolving door of C-suite executives.

In order to keep morale in the offices high, Uber CEO Dara Khosrowshahi sent out an email to the company’s employees. Here’s the transcript of the email sent out to Uber employees, as first reported by Bloomberg:

Team Uber:

I’m looking forward to being in front of you at the All Hands tomorrow, but I wanted to send you a quick note in the meantime.

First off, I want to thank you all for your passion for and commitment to Uber. We simply would not be here without you.

Like all periods of transition, there are ups and downs. Obviously, our stock did not trade as well as we had hoped post-IPO. Today is another tough day in the market, and I expect the same as it relates to our stock.

But it is essential for us to keep our eye on the long-term value of Uber for our customers, partners, drivers, and investors.

Every stock is valued based on the projected future cash flows/profits that the company is expected to generate over its lifetime. There are many versions of our future that are highly profitable and valuable, and there are of course some that are less so. During times of negative market sentiment, the pessimistic voices get louder, and the optimistic voices pull back.

We will make certain that we communicate our incredible value as a company that is changing the way the world moves, but also the value that we are building for our owners. But there is one simple way for us to succeed – focus on the work at hand and execute against our plans effectively.

Remember that Facebook and Amazon post-IPO trading was incredibly difficult for those companies. And look at how they have delivered since.

Our road will be the same. Sentiment does not change overnight, and I expect some tough public market times over the coming months. But we have all the capital we need to demonstrate a path to improved margins and profits. As the market sees evidence, sentiment will improve, and as sentiment improves, the stock will follow. We will not be able to control timing, but we will be able to control the outcome.

We will be judged long-term on our performance, and I welcome that. It’s all in our hands.

I look forward to being there at the All Hands to answer Qs and tell you more.

Megha Shah
Megha Shah
A dreamer, traveler, aspiring entrepreneur and a bookworm beyond repair, Megha Shah is extremely fond of writing and has been doing so since she was a child. Apart from being a part-time writer, Megha is currently in college, pursuing B. Com. (Hons). Megha is an ardent follower of ‘Hardship, Hustle and Heart’ and firmly believes in the power of hard work and destiny!
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