As an embattled Uber searches for a new chief executive to replace Travis Kalanick, one person has emerged as a front-runner, according to Recode: General Electric Chairman Jeff Immelt.
After a 16-year run as GE’s chairman and chief executive, Immelt brings to Uber a high-profile name and proven experience leading an industry giant, experts say. But his inexperience in the world of disruptive technology, and a disappointing track record in lifting GE’s stock, have left some observers puzzled.
“In many ways Immelt is a great headline kind of a choice, and in many ways I don’t get it,” said Michael Farr, an investor and president of Farr, Miller & Washington, a Washington, D.C.-based investment-management firm. Immelt is a leader who understands how to operate a mature corporation with exacting standards, Farr said. But on the other hand, he lacks the high-tech background of many Silicon Valley entrepreneurs. “You’re not hiring Mark Zuckerberg and just wowing the hell out of everybody, it’s a different kind of choice,” he said.
The ride-hailing company is looking at three contenders, all men, people familiar with the decisions told The Washington Post earlier this month. The CEO search comes in the wake of a torrent of controversies that have been marked by the departure of top executives and efforts to overhaul a workplace many have described as sexist and dysfunctional. Earlier this month, a key Uber investor sued Kalanick for allegedly withholding information from the board, adding yet another note of discord to Uber’s recent troubles.
In Immelt, Uber's management likely sees a seasoned corporate leader who led one of the most prominent American companies for nearly two decades. Compared with Kalanick, who was viewed as a brash risk-taker, Immelt is equipped with more of a measured, understated leadership style, said Arun Sundararajan, a professor at New York University’s Stern School of Business. And while Immelt may not fit the mold of a zealous start-up founder, Sundararajan said Uber isn’t on the same trajectory of existing tech giants such as Google, Facebook, or Apple.
Navigating transportation regulations on a global scale, with an eye toward the long game of driverless transit, Uber has its own set of challenges ahead of it. “In many ways they are better suited choosing an executive that is not drafted from the Silicon Valley, social media software world, but someone who has experience dealing with a global business that is diversified,” Sundararajan said.
At GE, Immelt oversaw a vast overhaul of the conglomerate’s portfolio. And as a highly regarded executive of a Fortune 500 company, he could bring a calming influence to a company in crisis. “He may be perceived as someone with broad managerial experience to turn Uber around,” said David Kass, a professor of finance at the University of Maryland.
Immelt could also prove to be an enormous asset as the company considers going public. To investors on Wall Street, skeptical of a company often tied with mismanagement and misbehavior, Immelt is a household name. His lengthy stint at GE might translate into a clearer strategy for Uber and a newly expanded executive team primed for an IPO. “His presence would convey a quality image and help improve its perception by the investment community when they go to the public markets in an IPO,” Kass said.
But experts are quick to point out that Immelt has a lackluster record when it comes to GE’s stock performance. GE’s stock price fell by more than a quarter during his time as CEO, even as the value of competing business went up. On Immelt’s watch, GE has been the Dow’s worst performing stock among companies that haven’t gone bankrupt or left the group of blue-chip stocks.
Some also questioned why a more hands-on, operationally minded candidate was not the front-runner. And the fact that no female candidate is in the running concerned analysts, too.
In addition to steering the company’s efforts to transform its internal culture and public image, whoever is chosen to lead Uber must also grapple with several business obstacles. The company has had to dramatically scale down its global ambitions. It was forced to retreat in Russia and China, where it was squeezed by dominant local rivals. And in the United States, as Uber has been beset by scandals, its chief competitor here, Lyft, has been gaining ground, doubling its ridership in the last year.
Uber is also hemorrhaging cash. Even as the company has boosted its net revenue, telling Bloomberg last year it took in $6.5 billion, it ended up losing $2.8 billion. The new chief executive would have to dramatically cut down those costs, especially as the board considers taking the company public.
The board is expected to make a decision before Labor Day.
Uber declined to comment for this story.