Uber CEO Travis Kalanick knows a thing or two about when to call it quits if your company’s not finding success.
Speaking onstage at UCLA’s Royce Hall on Monday, Kalanick addressed 1,200 entrepreneurs as he accepted the UCLA Venture Capital Fund’s Entrepreneurial Achievement Award, Re/code reported.
Among other things — like how the 2008 Woody Allen film “Vicky Cristina Barcelona” ultimately helped inspire him to get back into startups — Kalanick gave some advice to the audience about when to give up on a failing venture.
“When you are talking about, ‘I will lose my sanity for real,’ that’s when it’s time to move on,” he said.
Kalanick was an early employee at a company called Scour, a peer-to-peer search engine for files, videos, movies, and images, which employed SMB protocol to crawl through people’s Windows directories, index their files, and let others download them. Napster cofounder Shawn Fanning was an early Scour user.
The problem with Scour was that it let its users download movies and music for free without paying. The company wa sued for $US250 billion by a bunch of big entertainment companies, and was forced to file for Chapter 11 bankruptcy protection.
After throwing in the towel, Kalanick started a networking software company called RedSwoosh.
“The idea was to take those 33 litigants that sued me and turn them into customers,” he told the audience at FailCon, a forum in which founders offer hard-won lessons from their business failures. “So now those dudes who are suing me are paying me.”
RedSwoosh launched in 2000, just before the post-9/11 stock market crash. Ultimately, the company was acquired in 2007 by Akamai for $US23 million — $US19 million in stock and $US4 million in earn-outs.
Kalanick used some of his earnings from the RedSwoosh sale to help found Ubercab, which would ultimately become Uber.