Does a Startup Need a Moral Compass?

Twitter Travis Kalanick

Ride-sharing service Uber found itself in a lot of trouble this week after BuzzFeed quoted one of its top executives as saying the company should fund opposition research into journalists.

The executive, Emil Michael, suggested spending a million dollars to hire a team of opposition researchers and journalists, who would then dig into the personal lives and families of those critical of Uber. While Michael didn’t suggest any such plan was in effect, and apologized for his remarks soon afterwards, the idea that Uber was willing to attack its critics was enough to spark a social-media firestorm.

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As an emerging company in a hotly contested space, Uber already had a reputation for playing hardball with competitors. This past summer, taxi drivers in several major cities demonstrated against a lack of regulations they said gave Uber and similar services an unfair advantage in scaling up their businesses. That controversy had hardly cooled before Lyft, an archrival with a similar business model, accused Uber of using dirty tricks to gain market-share, including requesting and canceling thousands of Lyft rides.

Faced with that sort of competitive landscape, Uber executives probably feel they have little choice but to plunge into a multi-front battle. As the saying goes, when you’re a hammer, everything looks like a nail; and when you’re a startup that feels besieged from all sides by entities that seem determined to shut you down, sometimes your executives get a little heated when they think they’re off-the-record, and threaten to use your major asset—user data—as a weapon.

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After a day of negative blowback online, Uber CEO Travis Kalanick took to Twitter on the afternoon of November 18 to apologize for Emil Michael’s behavior. “We are up to the challenge to show that Uber is and will continue to be a positive member of the community,” he wrote. “And furthermore, I will do everything in my power towards the goal of earning that trust.”

However, Kalanick stopped short of firing Michael, and it remains to be seen whether Uber will actually attempt a cultural shift. (New reports of Uber employees abusing the ‘God View’ tool, which apparently allows them to see customers’ movements without the latter’s permission, may accelerate that shift.) As more than one analyst has pointed out, Uber isn’t the first company in America to triumph through a combination of grit and ethically questionable tactics; but it’s also not the first to implode thanks to the latter. At some point a company needs to make a show of having a moral compass.

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Image: Travis Kalanick Twitter Feed

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