How Uber CEO Travis Kalanick Went From A Startup Failure To One Of The Hottest Names In Silicon Valley

Travis kalanickPaul Sakluma/APUber CEO and cofounder Travis Kalanick.

Uber cofounder and CEO Travis Kalanick, 38, is prone to trash-talking and tantrums, but his unhinged confidence and competitiveness are part of what makes him such a brilliant entrepreneur. His car service company was valued at $US18 billion in June and today operates in 128 cities across 45 countries.

Before Kalanick was Silicon Valley royalty — his recent hot streak lands him at No. 8 on Business Insider’s 2014 list of the Sexiest CEOs — he was a young, wide-eyed entrepreneur struggling to catch a break.

As a computer engineering student at UCLA, Kalanick joined Michael Todd and Vince Busam’s side project Scour, a file-sharing service that predated Napster. He dropped out of school in 1998 to become a full-time employee, and the company took off.

But, even though it soon attracted the attention of millions of users, it also attracted the attention of power players in the entertainment industry. Together they sued Scour for a whopping $US250 billion, a dramatic gesture serving as a demand to cease operation. The team took the threat seriously and filed bankruptcy in 2000 to avoid a lawsuit.

Todd and Kalanick launched another file-sharing company, Red Swoosh, staffed by Scour’s former engineering team. Its services were legal, but some of its practices were not. The IRS discovered that Red Swoosh had been withholding taxes from employees’ paychecks, which Kalanick denies having prior knowledge of. The founders had to pay a $US110,000 IRS bill or else face jail time.

Kalanick was able to acquire sufficient funding, but the incident led to a falling out between him and Todd. Kalanick took charge of the company until the server giant Akamai bought Red Swoosh in 2007 for $US19 million.

A newly minted millionaire, Kalanick wasted no time spending money on a new house, lavish trips, and investments in startups. He also started hanging out with former Google employee Chris Sacca, who is now a billionaire investor and Uber funder, and his friends, including Zappos CEO Tony Hsieh and Twitter cofounder Ev Williams.

Then, at the 2008 LeWeb tech conference, he had a fateful conversation with StumbleUpon founder Garrett Camp. Camp told him about his idea for a luxury car service that was convenient and didn’t cost $US800 for a ride, a price he once paid. Kalanick was in, and the two started UberCab the next year.

As their vision evolved, they changed what was essentially a limousine service into an on-demand cab alternative accessible through a smartphone app. They secured $US1.25 million in seed funding and launched as Uber in San Francisco in 2010. In December of that year, Kalanick became CEO.

Kalanick’s relentless personality has pushed Uber to enter and thrive in city after city, despite the opposition of taxi companies and other obstacles. In the past few years, Uber has dealt with lawsuits, strikes, and other controversies from some of its drivers, who are private contractors rather than full-time employees. It has also seen the rise of competitors like Lyft.

But Kalanick never backs down from a challenge, and Uber is only getting bigger.

Legendary investor Mark Cuban, a former Uber investor himself, told Business Insider’s Alyson Shontell for her in-depth profile on Kalanick that “Travis is smart. Busts his arse and is a true entrepreneur. Can’t be much more complimentary than that.”

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