Why Uber Needs to Take the High Road to an IPO

Back in 2015, explaining why Uber Technologies Inc. was years away from a public offering, co-founder Travis Kalanick likened the company to an eighth grader too young to go to the high school prom. Since then, the ride-hailing giant has been besieged: allegations of sexual harassment, a lawsuit (now settled) alleging theft of trade secrets, a miscellaneous morass of malfeasance that spawned multiple criminal investigations, and the ouster of Kalanick as chief executive officer, followed by a lawsuit to keep him from taking control of the board. The newly appointed CEO announced he’s aiming for an initial public offering by 2019. Will Uber be cleaned up by then?

By one measure, they’ve collectively knocked off almost a third of the $69 billion valuation that made Uber the most valuable unicorn on the planet. Meanwhile, the firm that dominates ride hailing in China, Didi Chuxing, gained a valuation of $56 billion in December and positioned itself to better compete with Uber in other parts of the world. Uber’s tattered reputation has also been a boon to Lyft Inc., its closest rival in the U.S. Lyft gained significant market share in 2017 as Uber suffered from executive turnover and self-inflicted wounds, including a protest over the company’s ties to the Trump administration.