Uber CEO Dara Khosrowshahi on Leaving Iran, Hitting Rock Bottom, and a Costly Mistake at Expedia

85% of our volume disappeared overnight. We had to go through our largest layoff ever as a company. It was over 5,000 people that we laid off. It was during a really difficult, uncertain time for everybody. That was the definition of rock bottom for me.

Welcome to Confession, where I invite tech veterans to share their painful lessons. Everybody has painful stories, and I offer an outlet to talk honestly about the lessons learned. I'm Ali Partovi, and I run Neo, a venture capital fund and mentorship community for startup founders. Today, I sit down with Dara Khosrowshahi, CEO of Uber. Dara talks about his time at Uber, as well as insights about the importance of transparency, courage, and honesty as a leader. I think you'll really enjoy this episode. This is Confession. Let's begin. Dara, thank you for doing this. Welcome to Confession.

Happy to do it.

I want to start at the beginning. Tell me where you were born. Tell me a bit about what young Dara was like.

Absolutely. So you're a little familiar with this.

We're second cousins.

Yeah, exactly. I was born in Iran, in Tehran, Iran in 1969. And we were a part of, and you were a part of, a very, very big family. It was a merchant family that came to Tehran from Tabriz. Built a big business. And this was during a period in Iran where the Shah was the ruler, and he was really trying to modernize Iran and move it from where the Middle East was, which, you know, society that hadn't really been developed, to a modern industrial society. And our family was a part of that. We had built a very, very big business of pharmaceuticals and consumer manufacturing. in other businesses as well. You know, I think both of us probably, if things had been different, would be executives in the family business, you know, someplace, right?

Slightly different path.

Yeah, exactly. And then in 1977, 1978, the Iranian Revolution happened. I had some family who was involved with the Shah. While we were not political or religious in any, any way, We thought it was going to be safer for us to actually go to France for the summer to let things cool down, 'cause we actually— it was almost unimaginable for us to lose the lives that we had in Iran. And the revolution happened, and the Shah was toppled, and we were lucky enough to have an uncle here, our mutual uncle, Uncle Nasrallah.

Here in New York?

Yeah, here in New York, in Irvington, New York. And so we came to the US to stay with him, and we've never been back. Myself, father, 2 brothers, and then other— you guys stayed in Iran for longer.

Yeah, we were stuck there for 5 more years.

Were you stuck stuck, or you decided not to come out?

So it sort of depends who you ask. So my dad, I think, was patriotic and a bit maybe naive. I

think both of our fathers were. Yeah.

Yeah. And I think he— actually, naive, maybe not the right— just optimistic, which I'm an optimist also. Like, he saw that this might be a path to the people of Iran having self-determination. And there were elements of that for sure in the early parts. And so also, he was a founder. He was a founder of a university, and that was his life's work. And he didn't want to just ditch it. And so he stayed for he basically insisted on us staying. But I think there was also like, once we basically convinced him, no, we, we really need to leave, it was like really hard to get passports or like getting exit permission. So it got much harder and took much longer than the smarter ones who left when you—

Or the lucky ones. Yeah. And so we came to the States, Irvington, and then we got our, our own place in Tarrytown, New York.

Yeah, Edgemont Condos.

Yeah, exactly. Edgemont. And you guys eventually came to Edgemont too, right?

Yeah, we moved there and we ended up like getting a bedroom in Daja's house, our grandmother. And yeah, and you were like a few doors down or in the same condo complex.

Yeah. And like, I like to say to folks too that we lost everything that the family had, but the one thing that we didn't lose was family. family.

Yeah.

And so we were, we were very, very lucky to be so close as a family growing up. And that remains to this day. You know, we've got the family reunions and all that stuff. And it was what held us together. And it really helped me make the transition to the States. And we came to the States during a difficult time, but also a great time. It was a period during which the US was open to immigration. And I do think that immigration is something that has made our country great, and we were very lucky to come then. But at the same time, I think it was a year after I came, there was the hostage situation in Iran. So the tensions between Iran and the US were pretty high. But all of that allowed us to come to the States, and probably the US is the best place to kind of remake your life. And we were able to rebuild just like you guys have.

For those, like, 2 years of the hostage crisis, I wasn't in the US then. I was in Iran, and I was, I think I was like 7 or 8 years old. You must have been like 11 or something.

Yeah, I think 9, 10. Yeah.

I mean, from what I understand is like every night the news was saying, talking about how bad Iran is and they have our hostages. Did you feel animosity or did you feel in any way like people look at you as one of the bad guys? Would other kids or anything like that making you feel?

I wouldn't describe it as that. in that there wasn't hostility or animosity, but it's mean things that little kids do. So, I remember at our school, we would play a game called Hostage Crisis.

No way.

Yeah. And so, it was a very, very sophisticated game that consisted of locking me, the hostage, up.

Oh, my God.

So, they would lock me up in a broom closet, and the cleaning lady would find me. What the hell are you doing here? I'm not showing up for class or sports. So, that happened a lot. Wait, hold on.

Low-key, this is— this doesn't sound like a particularly healthy game. You weren't traumatized?

I learned to appreciate the dark and cleaning supplies. I'm just, you know, put me in front of a mess and I'm excellent. And, you know, you can choose to make a big deal of these things or not. And I think at the time, maybe I was clueless. Maybe I worried about other things. It didn't mark me in any way, one way or the other. Yeah, you felt the tension between the US and Iran. But I tell you, people were so friendly. People were so friendly. And again, we always had our family to come back to. And if you have that base, then a lot more becomes possible.

Did you ever, like, get into trouble as a kid?

I was a pretty good kid. And again, I don't know if it went back to the sense of responsibility. Kaveh, my older brother, got me drunk when I was a freshman to demonstrate that I shouldn't drink. You know, like, just— I got into the typical kinds of trouble that young kids do. But I'd say I was a decent kid. I didn't get into anything heavy one way or the other. What about you? Was that— you were— were you a surface good kid, or were you—

I was always trying to see what I could get away with and still not get into trouble.

It's a pretty good strategy.

I think I was mischievous, but also, like, I had such good grades and the, and also like I was friends with the teachers. I was definitely a teacher's pet, but then as a result, the mischievous side was like, how much can I do without getting into trouble? Also being an identical twin, it's like anytime people learned I was a twin, it was like, have you ever, you know, switched with your brother? Have you ever like played tricks on your teachers? So of course we had to try that.

Had to amuse yourself one way or the other.

We definitely did. Things like swapping classes with each other. I once was in Hadi's French class and there was a pop quiz and I was like, fuck, I'm going to bomb this quiz for him. So I got him an F.

Mom, it wasn't me. It was Ali.

Because we were financially insecure, we only— once we were driving, we only had insurance for one of us.

Oh, wow. That's great.

But then I had like— I had a pretty serious car accident. Hadi and me together. I was the one driving. He was the one who was insured. It was, like, serious enough that police came, and the car was totaled. And it was, like, late night and in the rain and so on. And so they took us back to the station. And while there, Hadi and I, like, changed clothes in the bathroom.

That's crazy.

Because, like, he— I, like, had given his ID—

Yeah, of course.

—as the driver. Neither of us was in any trouble.

I'd

never interacted with the police this way before. I didn't know what was going on. So it definitely felt risky. Like, what if they know that I wasn't really insured or he's not really the driver? Yeah, I had a few things like that. I actually wanted to ask about something else. And I've never asked you this. And I always wonder, I mean, even within our family, and I know other families that, you know, who came from Iran and the revolution, not everyone reacts to loss the same way. The way my parents and Hadi and I reacted, first of all, like losing all of our wealth, we went straight to like learning how to save money. My mom worked 2 jobs. I definitely felt motivation that like I need to somehow re-earn and rebuild what we lost, the greatness that our family once had. And I think, I mean, for sure I had pride in our grandparents and, you know, so on had built That all those enterprises in Iran, from the ground up, they weren't like inherited wealth or royalty.

Totally.

They were entrepreneurs. And so I felt like, that's in my blood. I can do it. But I'm wondering, like, did you have the similar kind of feelings of—

Totally.

—duty to build something back for the family?

Totally. And the funny thing, I'm curious as to how you felt. It was never communicated to me.

Yeah, same here.

Like, not once did my dad say anything about losing everything and rebuilding here, or my mom. Or even my brothers, we didn't talk about it. But there was this weird undercurrent that all of us were aware of, and clearly you were aware of as well, and this almost a responsibility, which is we're getting a second chance. I knew that for my parents, again, they were a little bit idealistic or dumb, whichever one you want to say, but they didn't take their money out of Iran. A lot of people who made their wealth in Iran, took it out of Iran during those times. I think our family wanted to rebuild. They wanted to reinvest. You know, that part of it was building a local operation that could expand in the Middle East and hopefully globally. And so we lost everything. And my brothers and I knew that my parents, one, obviously, our lifestyle got much smaller.

Yeah.

And at the same time, my parents were investing everything that they had to send us to private school. And there was this unspoken sense of responsibility for, I think, all of us in our family, which in hindsight might be why we've done quite well in life and careers, et cetera, to rebuild. It was much harder on my dad because he tried his hand at being an entrepreneur in the US, and for various reasons, he took a couple of shots and he missed. And after those couple of shots, he kind of gave up a little bit.

He should have just been a starving researcher like my dad.

He should have anticipated the AI revolution. Can you imagine? But my mom, she got to work. So just like your mom, she worked as a salesperson, et cetera. She got to work. She put her heads down. And then I think we as kids adjusted very quickly. And I think that's one of the great things about being a child. You can adjust. And while we didn't have everything we had in Iran, We had a pretty good, like, middle-class life in the US, and that's certainly nothing to sneeze at.

It's so interesting what you said about it being unspoken, and I had the exact same experience. There was one thing my mom said when— and this was even before we really lost everything, but we had lost a lot. And, you know, my mom told me that her family had been extraordinarily wealthy before. And she said, however, I never let my mom or dad give me any money. Like, you know, that she was proud of having, like, built her own, being independent. And just that, my takeaway was I need to learn how does one make money?

Exactly.

I didn't even know the concept, but it just implanted in me that that's something to be proud of.

I still remember my first job. It was at a gas station. Oh, that's—

I was literally going to say the other memory that came to my mind. I remember driving past this gas station and pulling over and seeing you there and being like, why is Dara the one filling our gas tank? And my mom being like, Dara got a job and he's earning money. And that for me was like, I remember being so proud of you and so impressed because, like, you were contributing to the family.

It was so cool, that sense of freedom and that satisfaction of making money. And—

How old were you? 16?

I think 16. Yeah. Yeah, I think I worked in summer camp one summer and then started working at the gas station, and it was fun.

Yeah, it's funny because given that Uber is now obviously related to cars, and then also you were the one who drove us to school.

I was not such a good driver back then, but it was okay.

No, I always remember waking up at 7:30 or whatever, coming out in the cold at 7:30 in the morning.

And my Buick Bonneville ready.

Let's fast forward a little bit.

Sure.

You went to school at Brown. Yeah. Like when and where did you start thinking about entering the business world and what was your path?

I was always interested in the sciences. I read science fiction like crazy when I was growing up. And, and when I went to Brown, I studied engineering and I studied bioelectrical engineering because I don't know about your, your father. My dad's like, Dara, you can study whatever you want. as long as you can be a doctor or an engineer. Take your choice. The world is your oyster. So I figured I would study bioengineering because it would give me a path to either go be a doctor or an engineer. I was a good son. Lo and behold, I fell in love with a woman in New York City, and I had a job in Kentucky, I think was my job coming out of school, but I wanted to be with her. So I called up my brother, Kaveh, who worked at Allen& Company. And I asked him, I'm like, hey, can you get me a job? Because I want to be in New York City because I want to be with my girlfriend. So I went into the world of finance completely accidentally. And one of my clients was Barry Diller, who was in the entertainment business, and he had moved over to home shopping, QVC, then home shopping. And at one point he took control of this entity Silver King Stations and Home Shopping, was merging it together and bought a company, USA Networks, because he wanted to bring kind of commerce and entertainment together. And he asked me to come work for him as his deal person. And I think Barry at the time was the one person in the universe that could get me to leave Allen& Company.

Wow.

So I went to work for him and he was half entertainment, half commerce technology. I was more technical, so I helped him on the technology side. And we wound up spinning off all the entertainment businesses and really focused on e-commerce. It was Ticketmaster, Match.com, a bunch of travel assets. The travel assets, we combined them all into an asset called IAC Travel. It included Expedia, Hotels.com, Hotwire. And at some point that entity ran into trouble. And the CEO at the time, Eric Blatchford, wasn't really up for it. He was more of the founder type. He was part of the founding Expedia team. So he decided that he was going to resign and we had no one to turn to. At the time, I was the CFO of IAC and I'd always wanted to go from kind of being a deal person to CFO. I liked broad business more and I was much more attracted to technology. So when that happened, we didn't have a CEO. I raised my hand. It was ignorance and desperation. It was desperation on Barry's part because he didn't have anyone else. And it was ignorance on my part, which is, hey, I can do the CEO gig. But when the two come together, sometimes crazy things happen. And so Barry hired me on as the CEO of IAC Travel, which then was spun off of IAC and became Expedia, the public company. So— Long road, weird road that was completely unplanned. It was a great choice, kind of a random choice, and that put me onto the course of being a proper technology executive, so to speak.

So what are you, what are you here to confess about today?

So, uh, my confession is actually my early, I would say, uh, early years as CEO at Expedia. And I was a rookie CEO and not a particularly good one at the beginning. The stock, when we had spun off the company, the stock was around $40, $45 a share, and it had drifted down. Trends weren't great. Travel trends weren't great. A lot of sites were going direct for the first time, you know, because the first instantiation of online travel was really The online travel agents, us, Travelocity, Orbitz, et cetera. And then the hotels and the airlines especially started getting their act together and more and more of the traffic was going direct, whether it's a Delta or a Hilton or Marriott, et cetera. The growth of the industry really started slowing down and as a result, the stock was suffering.

And how many, how many people worked for you at this time?

I think at the time it was about 5,000 or 6,000 people.

Wow.

And it, it was, Pretty scale business. And it was structured as a holding company. We had Expedia.com, Hotels.com, Hotwire, TripAdvisor, all operating independently. And I wasn't an operator-operator. I was more of a portfolio manager. During that time, one of our largest competitors was Priceline, and they had just bought a, what was then a small company called Booking.com. Okay. I had gotten to know them and we had negotiated a deal to buy them out.

Them meaning Booking.com.

It was Priceline at the time.

You weren't competing to buy Booking. You had gotten to know Priceline and you were—

And they had bought Booking. So this was the original mistake, if you want to call it that, which is, but it was not my mistake. We didn't buy Booking.com because we poo-pooed them. Priceline bought them. And I had gotten to a deal with Priceline, not because I thought Booking was going to be amazing. It was a nice business that was growing at respectable levels at the time, but because Priceline at the time, I don't know if you remember the William Shatner commercials, all that stuff, was a really big low-cost competitor of ours. And I had the deal basically done and we had a board meeting to essentially approve the deal. And I missed the quarter. We had earnings, they were terrible. The stock that was already in the 20s went down, I think at like 16, 17 bucks a share. And at the board meeting, when I was presenting the Priceline deal, the board started pushing back, including Barry, and I think rightfully so, and said that, hey, Dara, if you can't Get your own house in order in terms of the earnings of the business, the growth of the business. Why should we give you another billion and a half dollars to go buy this other company, Priceline? So shouldn't you get your own house in order first? And I think that the board did it because they were making a proper case and a board should act as a check for the CEO. But I think they were partially doing it to test the veracity of my wanting to go forward with this. They were pushing back to see how much I wanted this deal. And I asked Barry about it one day, which is, if I had laid my body down on the train tracks, I'm sure they would've approved the deal. But I lost confidence. I was first-time CEO. It had been a rough year, year and a half, and I just backed off.

So you were just like, they're not going to approve it. I'm not going to push for it.

I didn't push hard enough. I am sure if I pushed hard enough, I would've gotten it done, but I didn't push hard enough. Now, yes, they were pushing back. Why should we do this, et cetera? But they were making all the typical Arguments that you should when you're testing someone else. I said, you know, we're going to wait for a quarter or 2. It's fine. I'm going to get my own house in order, et cetera. By the time we did, Priceline was also suffering to some extent for the same reasons. And by the time we did, that stock price had gone up. They weren't willing to do the deal. And that, you know, if you look at now Booking.com, Priceline renamed itself Booking.com because the Booking.com business has completely taken over. You know, that company's worth $140, $150 billion.

No way.

So it was a very, very, very expensive mistake of mine, whether the mistake is missing the quarter. But I think the real mistake was not being confident in my own convictions. And I knew it was a good deal, but—

How did you know it was a good deal? Like, if you take yourself, take, if I was in Dara's body, Going back then, what would I be feeling?

I knew that the travel business was a great business. Travel would grow at GDP plus. I knew it was very, very early in the adoption of online travel. Probably travel online is probably 60% of travel market. It's probably 10%. So you knew that all of the long-term metrics were on your side and there was wind at your back. But I was just, I was I let myself be off balance because of a bad quarter or two. It was absolutely the right bet to make.

And you knew it and you had worked on it and built the deal.

I knew it. And you, you know, I, my background was banking, so I was pretty good at, at the deal business, but I just lost confidence.

What were you afraid of? Like what was at stake if you had pounded the table?

They were pushing back against me and, and I don't know if this is in you, but I think there's something culturally about being Iranian, which is there's this like, being deferential to your elders.

Yeah.

And I was a young CEO at the time. This is the board. They're a bunch of gray-haired 50, 60-year-olds who had had a ton of experience. And I think sometimes, especially in technology, especially in our business, you have to actually have a lack of respect for experience because Where you create value and where there's the greatest value creation opportunity is when history doesn't repeat. Now, sometimes history rhymes, et cetera, so you should take those lessons. But the biggest, biggest opportunities are when something's fundamentally different, right? AI is fundamentally different, and the people who recognize it as such and stuck to their convictions versus saying, oh, this is just some other wave, they're the ones who succeeded. So you, you just have to know. when to go against the grain.

Yeah.

And you've got to hold on. And I think back then, I just wasn't brave enough. You know, there was this deferential quality, which is, well, these people who know a lot are pushing back, so I've got to question myself.

And they're not going to respect you if you insist.

It was just, you know, I was putting more weight into their experience than my own. And I had lost some confidence as a result of the— stock price coming down and as a result of the missed quarter, and then put my body across those railroad tracks. And you don't have that many moments as a CEO or as an executive where you have to do that, but sometimes you have to do that. The biggest— I'll tell you another lesson that I got from Barry when I was there is once he told me, hey, Dara, I didn't hire you to be average. Okay? And as a leader, whether you're a CEO or some— or another leader, you, you, when you recognize those moments, when you see some kind of dislocation, you have to take those. And by design, they're lonely.

Yeah.

And this was a moment, again, I think I had the power to convince the board, but I didn't have the confidence or the veracity to do it. And it was a Big mistake. Very expensive mistake. But I've learned from it.

I wish I could say I am deferential to the elders, but I think my—

You didn't suffer from that disease?

At least not as much.

Yeah.

Why should I listen to a bunch of extinct fossils?

You know, you're in startup land. By definition, you know, the definition of startup is you're coming up with ideas that no one else had.

Yeah.

But every day is going against the grain. Otherwise,

I probably would have insulted all the board members and get fired on the spot.

I wish I had you with me.

Well, thank you for sharing. And is this public knowledge?

I don't think so. No. I mean, you know, Barry always tells the truth, so I'm sure he would, he would confirm it. But it's not something that we talk about.

Yeah, it wouldn't have been filed or disclosed.

It was considered and rejected, but it sits kind of in the back of my mind.

Oh my gosh.

Yeah,

Expedia could have been even more, even bigger. Yeah, yeah. You could be even more successful.

We did well, but we could have done a lot better had I not backed down that day.

Although, who knows? You might still be at Expedia then instead of—

Uber, yeah.

At Uber.

Sure.

Speaking of Uber, by the way, I still remember when Uber was beginning to search for a new CEO, like long before they chose you, like Hadi and I were in Seattle telling you like, they should choose you as the CEO, but they never would because no one's heard of you, or this.

Yeah, yeah.

'Cause you had such a low profile. Like you were kind of the person that lurking in the shadows.

I was. I so remember that conversation with you guys. It was at Hadi's house.

Yeah.

In Seattle and in Bellevue. And I was dying to tell you guys.

Yeah.

But I was CEO of Expedia. They had just reached out to me.

Who had? Uber had?

Uber had. Yeah.

Yeah. Oh my gosh. When we were discussing this?

Yes. They were just reached out to me. And at the time, I thought that they were crazy. And so, at first, I said no, but then actually Daniel Ek convinced me to say yes. You brought that up during the no phase. And so, I thought, oh my God, I can't even risk remotely that anyone finds out about this. So I didn't come out and confess to you guys. But God, I was dying to talk to you about it. And plus, I thought it wasn't going to happen. I really thought at that time it wasn't going to happen. But then I—

I remember the discussion being like, yeah, the names that are floating in the press are this and that and the other.

Meg Whitman, Jeff Immelt. I'm like, who the hell are they?

These famous names.

Yeah.

But Hadi and I were both like, if they were smart, they would hire someone like Dara, who's not famous, but would actually come in and roll up his sleeves and do a good job.

Someone said you've got an eye for picking the right talent.

I guess I do, yeah. So I also remember when you first joined Uber, there was a press article that quoted you saying, I'm a little bit scared. Do you remember that? And what was behind that? Because that really stuck with me in a good way because you just don't see CEOs confessing to being scared that way. Yeah.

I think it was in my goodbye email to Expedia. I said I was afraid or something about— So you put it in writing? I put it in writing. Yeah, it was my farewell email. And Ali, through my life, both personal life and then professional life, I found that being completely truthful and transparent is the best way to build relationships. And especially for a CEO, Is to build a deeper relationship with your employees. You know, like the, the, the companies that, that are great, they're not just jobs, they're missions. And there's an emotional pull to the company and, and the, there are real emotional connections between the team members. And if you're sitting there being all corporate and BSing your team about how you really are and how you really feel, you're going to just get the same stuff back. And so what I found is admitting weakness or admitting fear is actually a bigger lift for a leader because you're not supposed to be weak, you're not supposed to be afraid. But in the end, we're all human beings. And if you can, as a leader, communicate that transparently and that honestly with your team, one, it creates kind of a deeper connection with them. But second is it allows them to communicate that same transparency and honesty back to you. And I found that when CEOs make mistakes or leaders make mistakes, often it's not a mistake of judgment, but it's a mistake because they actually didn't have all the information.

Tell me, what do you mean?

Because the higher up you are in an organization, to some extent, unless you really combat it, the less you really know what's going on. Interesting. All of the communication, I've got a chief of staff, and so my schedule is completely manufactured, right? And it's manufactured by incredibly well-meaning people who are trying to allocate my time based on, again, what all of them think on average.

I guess shield the bad news from reaching you until they fix it or—

No, it's just silly to shield the bad news, but they're deciding what's appropriate for me to hear. And I think they're doing it based on their best judgment. And we have a culture like we don't shield the bad news unless you as an executive are constantly hiding the bad news, your own bad news, your own fears, your own weaknesses, Your team isn't going to communicate that to you.

Right.

I've always had a policy of I'm just dead honest to people. And everyone has a bullshit meter, right? Everyone knows when you're being all corporatey to them. I just tell the truth. Why waste time? I tell the truth. And that allows me to get the truth from my team members as well. And then to the point of the curation, I actually structurally have a bunch of random meetings. I don't just meet with my directs, I meet with a bunch of engineers, et cetera. I make sure I talk with them. What are they up to? 80% of the time it's a waste of time from a business decision standpoint, but you get to know people and you get channels that are untraditional channels for information back to you. And those are incredibly valuable.

When you talked about the hypothetical of someone saying, this competitor is kicking our ass in this other country. I guess what I was thinking is that for that person to tell you the stark facts would also— would be scary. Totally. It's safer to give you the rose-tinted version of it, and they would have to overcome fear to tell the honest truth. It seems like you're also saying you had to overcome for you to be honest, but that's giving everybody else the strength.

Exactly.

And be honest about it.

And the person in power has to do it first. Right.

Right?

Because they're not going to come to me first. And I hear some people saying, oh, don't come to me with questions, come to me with answers. If you haven't figured it out, I want you to tell me.

Right.

Because then maybe we can work together and we can jam and we can come up with strategies. If you make a mistake, I want you to tell me so I can learn from that mistake. That's really useful data for me to have. And I do think one thing that we've done, and it was part of Uber culture before I joined too is there was a cultural norm called toe-stepping, which was about say the unpleasant stuff in a meeting. It was—

Meaning don't be afraid to step on someone's toes.

Yeah, yeah. Don't be afraid to disagree. It was a different context. And it was weaponized to some extent because it became okay to be a jerk to some extent. Some people took that as a translation layer, even though that was not the intent. of the value. So Uber came from a place that I think valued honestly and transparent communication, and I wanted to keep it going because usually the larger you get, one, the troublemakers usually are rejected from an organization, and I love the troublemakers. You've got to keep the troublemakers. And then two, the more kind of layers of communication you have in an organization, and usually as organizations get larger, there are more layers. The more the facts get muted and edited by the time that they get to you. And that editing destroys what I feel is the good stuff, which are the sharp edges of every single problem. Because the sharp edges usually give you a clue as to what's the best way to solve that problem. You want to project confidence to your team, you want to project confidence to your investors, et cetera. But being truthful about the problems of a company, even when I talk to investors, Of course, I talk about the good things that we're doing because there's a lot of good things that, that we're doing. But I also talk about the problems that we're facing and where we're not doing as well competitively, because to me, that's an opportunity. And so of course I present it as an opportunity. My policy is just to be more straight than I would say most people. Um, it's how I've decided to live my personal life.

Mm-hmm.

And It just makes things easier. It makes things simpler. I want to live a life where I can be honest to my friends and whether I'm in the office or you and I are having a drink, I don't want to bullshit you. It's a waste of time.

I admire that. It takes strength, but it's definitely the better path. Has there ever been a time when you hit rock bottom?

Yeah. COVID was rough. COVID was rough both personally but professionally as well. At the time, Uber was deeply unprofitable. And at the time, the competitive field was really tough. Didi was competing against us, Chinese, you know, the Uber of China in Latin America, and was competing very aggressively. And by the way, they still are. And Lyft had been gaining share against us in the US as well. We were losing $2 billion a year. Post-COVID, Our mobility business, which was the profit generator of the business, and we were using those profits to invest in technology and also invest in Uber Eats overnight, 85% of our volume disappeared overnight. And we went from losing probably $1.5 billion, $2 billion a year to losing a run rate of $4 to $5 billion a year. And I think at the time I had like $8 to $10 billion in the bank. That was rough. It was a very, very difficult time. Personally, obviously, we were all cut off from the world. We had to go through a very large layoff. And I remember I was having a bunch of meetings with my staff, Zoom meetings with my staff, and I wanted to kind of talk it over with them. What should we do, et cetera? Because it was such a tough decision. And I think in hindsight, for me, I was trying to put off the decision. And so the way to put off a decision is ask for more data, talk some more about it, et cetera.

You were dreading it.

Of course, because I had to make really, really deep cuts into the company. Nelson Hsieh, our CFO at the time, he said, Dara, we've talked about it a bunch. Why don't you just tell us what you want to do? And we respect your judgment. And we're behind you. And that was like a bell was rung.

Oh my gosh.

And we just had that meeting and I just kind of told, told, said, my wife, you know, said very well, as I said, I've gotta think tonight on some stuff. So I just spent a bunch of time alone and I came back and, you know, we, we had to go through our largest layoff ever as a company. We shut down a bunch of businesses, decided to offload a bunch of businesses. But it was over 5,000 people that we laid off.

Oh my God.

And it was during a really difficult, uncertain time for everybody. That was the definition of rock bottom for me because I felt like I was letting a lot of people down during the time when you, as a company, you don't want to let people down. But it was a matter of survival for us. In hindsight, It was super important for us in terms of actually like leaning out the company, bringing discipline to the business. Our Uber Eats business then completely exploded in a good way, not in a bad way. And our Uber Eats business, which before COVID was probably 10% of the business, now it's 50% of the business. And I think actually it's gonna be bigger than the mobility business, maybe not profit-wise, but definitely in terms of scale and volume. But those COVID days were really, really dark days for me.

You said that you felt like you were letting people down.

The deepest connection that I have is with my team, the employees at Uber. It is, I want to do great for the shareholders. I'm a huge shareholder. So that is absolutely something that you have to do. Now, our team members are shareholders. And the thing, most of our shareholders, They have a portfolio of stocks, et cetera. They're making a bet on you, and that's awesome. But people who work at Uber, they're making a bet on you with 100% of their time during the most productive years that they have. And with the talent that we attract, they have a lot of great alternatives. So I just feel a really deep sense of responsibility to my team members because Ali, the one thing that you can never get back— our family lost a ton of money. We were able to make it back. The thing that you can never have back is your time.

Yeah.

And the Uber team members are investing their time during the peak of their careers. And so I feel a really deep responsibility for them. And many of the ones that we laid off had made a bet on us. And yes, there was an act of God or a lab or whatever you want to call it that caused this, but we weren't able to stand up. Like, I believe that we absolutely did the right thing. And without that decision, we probably wouldn't have survived to this day. So I would've made the same decision were I there. But yeah, I felt like I let down our team members, and that's tough.

Well, Dara, thank you for sharing all this. You talked about being locked in a closet, working at a gas station, your dad's entrepreneurial failures. Great to have you on.

Awesome. Thanks, cuz.

If you enjoyed this conversation, please subscribe to Confession wherever you get your podcasts. In an upcoming episode, I'll be interviewing Luana Lopez Lara, co-founder of Kalshi. She has an amazing story and shares a lot of intimate moments behind the ups and downs of building Kalshi.