TPG’s Trujillo Goes From Investor to Fixer Atop Troubled UberBy
Uber needs both spark and global transition: TPG’s Coulter
Trujillo led firm’s investments in Vice, Uber, Airbnb, Spotify
Uber Technologies Inc.’s new board member, David Trujillo, spearheaded TPG’s investments in four startups now valued at more than $5 billion each. After a misstep by his boss, he’s taking a seat at one of the biggest -- and most precarious -- of them, whose fate increasingly lies in the hands of its investors.
Trujillo, 41, joined the board of Uber this week, replacing TPG Chairman David Bonderman, who resigned after making a sexist joke. Despite the awkward circumstances of his boardroom debut at the ride-sharing giant, Trujillo will likely settle in quickly, given his close ties to the company since leading TPG’s investment in 2013.
Stakes are high as San Francisco-based Uber seeks to rebuild its culture after a series of harassment and discrimination allegations led to mass firings, social backlash and ultimately the ouster of Chief Executive Officer Travis Kalanick. Two of the startup’s major investors, TPG and Benchmark Capital, are sending in fresh faces to the eight-person board, with the company’s $69 billion valuation at stake.
“TPG has a unique position in the market, where we invest in companies that are both new and big,” co-CEO Jim Coulter said. “We need to continue that spark that is Uber but also help it transition to the global marketplace that it is and get the right management in place. We have that skill set, and Trujillo, who knows the company inside and out, can bring the full force of TPG’s platform to bear.”
A mainstay of San Francisco’s tech scene, Trujillo joined TPG in 2006 focusing on technology, media and telecommunication investing for the firm’s buyout fund. He later became head of internet, digital media and communications and expanded into growth investing about five years ago. He’s led deals in Uber, Airbnb Inc., Spotify Ltd. and Vice Media Inc. Now he oversees about 10 people, investing across TPG’s growth and buyout pools.
“A lot of people in the private equity business play checkers,” said Laurence Tosi, Airbnb’s chief financial officer and the former CFO at Blackstone Group LP, the world’s biggest private equity firm. “He’s good at playing chess. He’s much more of a strategist and thinker.”
Most recently, Trujillo led TPG’s $450 million investment in Vice Media, which valued the youth-culture brand at $5.7 billion. He also worked on the firm’s forays into Canadian entertainment company Cirque du Soleil Inc., talent and sports agency Creative Artists Agency LLC and beauty-subscription business Ipsy, among others. As a private equity dealmaker in an environment filled with venture capitalists, Trujillo is valued for his big-picture thinking.
“Unlike some other investors, especially here in Silicon Valley, he doesn’t get into the minutiae -- he’s much more of a company builder at the board and strategic level,” said Marcelo Camberos, Ipsy’s CEO. Trujillo, who sits on Ipsy’s board, led TPG’s investment in a $100 million funding round for the San Mateo, California-based business in 2015.
Trujillo declined to be interviewed for this article. Last year, in a Bloomberg Television interview with Emily Chang, he outlined his rationale for investing in companies like Uber and Airbnb.
“While they’re engineering- and technology-based, and they definitely need to scale by adding more engineers, they’re also dealing with physical objects in the real world,” Trujillo said, adding that it gives TPG a chance to bring to bear long-standing relationships with regulators and the automobile industry around the world. “It’s been a unique way to pivot from our strengths to move into an area that -- knock on wood -- we’ve done well in so far.”
For TPG, which manages $72 billion across different strategies, putting Trujillo in the center of a high-profile situation reflects its recent evolution. The firm was co-led by founders Coulter, who’s now 57, and Bonderman, who’s 17 years older, for more than two decades before Bonderman moved into the chairman role in 2014.
The following year, TPG hired former Goldman Sachs Group Inc. executive Jon Winkelried to be co-CEO alongside Coulter. It’s also elevated younger star dealmakers, such as 45-year-old Todd Sisitsky, who now oversees private equity in North America and Europe.
Growing up in a northwest suburb of Chicago as the son of two Colombian immigrants, Trujillo attended local public schools before heading to Yale University, where he studied economics, and later the Stanford Graduate School of Business. David Swensen, the chief investment officer at Yale’s endowment, first introduced Trujillo to investing and private equity. Swensen didn’t respond to a request for comment.
Trujillo remains involved in student education and was a keynote speaker at the National Investment Banking Competition & Conference in 2015, an annual event that connects students and industry veterans.
Early in his career, Trujillo was as an investment banker at Merrill Lynch and later joined Chicago-based private equity firm GTCR. His new role at Uber is far from his first time in the boardroom: Trujillo is a director at eight companies, including Cirque du Soleil, RCN Telecom & Grande Communications and Vice. He’s also a trustee at a San Francisco preschool and a donor to the Raphael House, a program that helps families find stable housing and financial independence.
“We all think we’re the only board that he’s on,” said Airbnb’s Tosi. “I can call him any time, anywhere in the world, and he’ll call me back in 10 minutes.”
Uber may be Trujillo’s biggest challenge yet. More than 20 employees have already been fired and top lieutenants ousted, reaching a climax Tuesday night with the departure of Kalanick. Trujillo also joins in the shadow of Bonderman’s comments: It’s been 10 days since his boss left the board and apologized for the remarks, made during a companywide meeting about changes that address discrimination and other cultural issues.
As Uber faces a period of intense change, Trujillo’s seat as a private equity investor on the board could give him a unique role in shaping its future.
“There’s a valuable discipline that comes from buyout and later-stage investing,” said Scott Stanford, the co-founder of Sherpa Capital, which is also invested in Uber, Airbnb and Ipsy. “Uber is a rare example of a company that has rapidly ascended from startup to massive global presence. It is critical to have someone who has both the buyout and large-company experience, while also having that growth mentality.”
For more on Uber, check out the Decrypted podcast: