The news that Expedia CEO Dara Khosrowshahi has been selected to take over as Uber CEO came as a surprise Sunday evening. But those who know him say the 12-year Expedia veteran’s aptitude for managing strong personalities and experience navigating a complex industry make him an ideal candidate for the job at this pivotal moment for the ride-hailing giant.
GeekWire talked with friends and former colleagues about Khosrowshahi’s approach as an executive, getting a sense for what Uber might look like under his leadership. Several of them referenced an “internal calm” that would come in handy dealing with the complex dynamics on Uber’s board of directors and tricky public relations issues the company faces.
“Dara is extremely good at navigating very strong personalities,” said Erik Blachford, who served as Expedia’s CEO in the company’s early days and is currently a venture partner at Technology Crossover Ventures.
“He worked closely with Barry Diller, who is this brilliant mercurial guy,” Blachford explained. “And Dara is really good at dealing with that. I think he will be good dealing with all of the personalities around Uber, too. Some people are just better at navigating that stuff. He has a level of internal calm that people can feel and respect, and it works really well for him.”
Diller, who serves as Expedia’s chairman, confirmed the Uber offer in an internal message in an SEC filing Monday. He said that nothing has been finalized but he expects Khosrowshahi to accept the job.
Uber’s board boasts heavy-hitters like Arianna Huffington of Thrive Global Holdings and the Huffington Post and influential Silicon Valley investor Bill Gurley of Benchmark, though Gurley will soon be replaced by one of his partners. Until recently, University of Washington fixture and TPG Founding Partner David Bonderman was also on that list but he resigned in June after the media got wind of a sexist comment he made during an Uber board meeting. It was part of a series of scandals that tarnished Uber’s reputation and led its former CEO Travis Kalanick to resign. Earlier this month, Benchmark filed a lawsuit against Kalanick citing “gross mismanagement” of the company.
“It’s Uber’s gain and Expedia’s loss when Dara gets the Uber CEO job,” said Dennis Schaal, the executive/founding editor at online travel news site Skift, in an email. He added later, “I’m sure Dara knows and is comfortable with all, or most, of Uber’s big shareholders such as Benchmark and Bill Gurley etc. so he will have less trouble dealing with them than perhaps others. Also, I’m sure the shareholders respect him.”
Those close to Khosrowshahi say his statesman-like personality and reputation for political activism can help Uber navigate its image problem, as Hadi Partovi told GeekWire in an email. Partovi, a tech industry veteran, is Khosrowshahi’s cousin, an angel investor, Uber investor, and CEO of Code.org
“Uber needs a young technologist who can deliver 10x growth,”Partovi said. “Dara has done that at Expedia. Uber also needs somebody who can manage all the internal discord and the international regulatory battles. Dara is a well-loved leader and statesman, he is perfect for the role.”
Khosrowshahi was born and raised in Iran until age 9, when he immigrated to the U.S. with his family during the Iranian Revolution. He has been an outspoken critic of Trump administration policies, including the president’s executive order restricting travel into the country.
“Uber also gets a progressive guy who’s taken an activist stance against Trump’s travel bans and anti-immigrant policies, which hurt Uber when drivers couldn’t return home from their travels,” said Skift’s Schaal. “But just as important, he’s done a lot to promote the advancement of women within Expedia. I believe 52 percent of the workforce is female, and Dara has done much to recruit women to engineering jobs, which traditionally have been male-dominated.”
Uber has been mired in controversy since February, when former engineer Susan Fowler published a blog post describing harassment and sexual discrimination at the company. That led to an investigation into Uber’s culture by former U.S. Attorney General Eric Holder and Kalanick’s eventual resignation.
“[Dara] understands that companies succeed or fail based on their internal culture,” said Zillow CEO Spencer Rascoff, who used to report to Khosrowshahi as Expedia’s VP of lodging. The two are also linked by Rich Barton, who was a founder of both Zillow and Expedia and is a venture partner at Benchmark. “He is exactly the type of leader that Uber needs now, to mend its internal challenges and move forward anew,” Rascoff said of Khosrowshahi.
Uber faces some tough problems, which are Khosrowshahi’s specialty, according to Avvo CEO and co-founder Mark Britton. The two had a close professional relationship at IAC, before Expedia spun out as its own entity.
“Dara loves hard problems, even when they are bordering on chaos,” Britton said. “We worked closely together when he was the CFO of IAC and we were trying to assemble a new division, IAC Travel, under Expedia management. It was such a crazy time because, not only were we trying to synthesize operations of five travel companies, we were dealing with pricing pressure from suppliers, states trying to tax us in creative ways and new-fangled competitors like TripAdvisor and HomeAway. Dara seemed attracted to the hardest problems, and I was always impressed by his mix of low ego but high clarity in charting the path forward. I have no doubt Dara will bring similar clarity to Uber.”
That level-headed demeanor helped Khosrowshahi navigate some blockbuster deals while at the helm of Expedia. He oversaw acquisitions of Travelocity, Trivago, Orbitz, and other travel brands. In 2015, he pushed Expedia into the sharing economy with the $3.9 billion acquisition of Airbnb competitor HomeAway.
Blachford said that in “fractious” or tense negotiations, Khosrowshahi stays cool and level-headed, “and that’s one of the reasons he is a good deal maker.”
Those skills don’t come cheap. In 2015, Khosrowshahi was the highest-paid CEO in the S&P 500. His compensation totaled $94.6 million, including a $1 million salary, $2.8 million bonus, and $90.8 million in stock options. Bloomberg Technology estimates that Khosrowshahi’s unvested stock options at Expedia are worth about $184 million and says it would cost at least $200 million to poach him. Partovi believes it’s well worth the cost.
“As an Uber investor, I couldn’t be more pleased for my investment,” he said. “Dara is an amazing tech leader and experienced in international travel.”
Whomever takes over after Khosrowshahi will lead Expedia its next stage of growth and oversee the company’s headquarters move from downtown Bellevue to the Seattle waterfront, scheduled to take place in 2019. It’s a big job but Blachford says Khosrowshahi is leaving the company in good shape.
“I think Expedia is in a good spot right now,” he said.
Many questions remain about the future of Expedia and Uber but most everyone we talked to expressed confidence in Khosrowshahi’s leadership, should he take the new job.
Brian McAndrews, who sits on the board of The New York Times with Khosrowshahi, echoed the notion that the Expedia CEO “has a humility about him that serves him very well when dealing with a range of egos and personalities.”
“Dara is a great choice for Uber,” McAndrews said in an email to GeekWire. “He has demonstrated at Expedia that he is able to successfully lead a business over a sustained time in a constantly evolving business environment. Dara is a very thoughtful person who combines the ability to incorporate his experience and learning into decision making, while at the same time being open to new ideas and alternative viewpoints.”
When Khosrowshahi raises ideas in The New York Times boardroom, McAndrews said “he doesn’t speak as if he understands the business better than management and aggressively assert his ideas; instead he makes informed suggestions and explains why his insights from another context might be relevant.”
News of Khosrowshahi’s selection came out Sunday evening in reports from The New York Times and Recode. Expedia stock is down about 4 percent in the wake of the news but up more than 34 percent over the past year.