$UBER - It's Been One Week Since Uber Left VC

Back in September, bankers gassed up Uber with one big, flashy number: $120 billion, the value at which Wall Street’s finest thought the ride-hailer could go public. Were we ever so young?

Today, it’s worth about half that.

Now that its “train wreck” of a first week public is mercifully over, it’s clear that Uber’s listing was mostly an exercise in expectation management, the NYT writes.

• A 4% fall from your IPO price is a tough pill to swallow when you were once slated to be the biggest U.S. company to list on an American stock exchange ever.

What happened?

• It was a tough sell. Uber has taken over $10 billion in private funding, meaning some of the most common IPO customers already owned stakes—which were often bought at a lower price earlier on.
• And timing is everything. A month before Uber IPO’d, rival Lyft went public and immediately sank below its offering price. Skepticism spread like mono in ninth grade.

Of course, Uber can’t pass all blame on external factors. It had its own growth concerns as competition in both ride-hailing and food delivery grew more intense.

Zoom out: It really is too soon to know how Uber fares long-term. But one thing is for sure—with Uber ready to move back into Masayoshi Son’s basement, the rest of 2019’s prospective IPO-ers (Postmates, WeWork, Airbnb, etc.) are thinking long and hard about flying the VC coop.  

Uber did have one win this week

It doesn’t have employees! A nightmare for us but good news for Uber. The National Labor Relations Board said Tuesday that Uber drivers are independent contractors, not employees.

That means 1) Uber drivers don’t have the right to form a union/bargain collectively and 2) the company likely won’t have to spend gobs of money offering those workers the benefits they’ve been seeking.

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