Agreed. Fuck Benchmark. Travis makes each partner $1 billion personally and this is how they treat him? They should be blackballed by every great founder out there. I had respect for benchmark but not anymore. They are greedy assholes.
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Benchmark Capital Sues Travis Kalanick for Fraud
21–30 of 196 posts
Re: Benchmark Capital Sues Travis Kalanick for Fraud
#22In my best Nelson Muntz voice: "Ha-ha". The VCs have done this to themselves. They put up all the money, they should have never allowed themselves to be put into this situation. Decades ago, when I was at startups, this was 100% clear, cut and dried. The Golden Rule. People who have the gold make the rules. I'm sure this won't be a popular opinion, since more HN readers are founders and employees than are VCs. But do…
Because both sides negotiated that arrangement in good faith.
That may not be the case in this particular instance, but in general, both parties are adults, reasonably smart, and not operating from a position of duress.
So if you negotiate a deal that has a governance structure of that form, you are stilled owed control.
Re: Benchmark Capital Sues Travis Kalanick for Fraud
#23The key point of conflict appears to be the following: The suit revolves around the June 2016 decision to expand the size of Uber's board of voting directors from eight to 11, with Kalanick having the sole right to designate those seats. Kalanick would later name himself to one of those seats following his resignation, since his prior board seat was reserved for the company's CEO. The other two seats remain unfilled.…
Board seats are part of bargaining chip during funding rounds.... they are very very important.
If you lose control of the board as a founder, you basically are another employee at the company, at the mercy of your investors, who can choose to bring "adult" supervision anytime they seem it is fit to them.
Having the founders control of the board did well to both facebook and google on the long term. On the other hand you have Twitter where nobody is in real control of it, and it ended up with no clear direction.
Re: Benchmark Capital Sues Travis Kalanick for Fraud
#24Agreed. Fuck Benchmark. Travis makes each partner $1 billion personally and this is how they treat him? They should be blackballed by every great founder out there. I had respect for benchmark but not anymore. They are greedy assholes.
It seems like newspeak to call people "greedy" for suing someone despite that they (nominally) made a lot of money for those people. It seems like the fund is insisting that its investments follow the law, not indemnify criminal actions, etc. Doing that to an investment that made you money seems the opposite of greedy.
How are we seeing this so differently?
Re: Benchmark Capital Sues Travis Kalanick for Fraud
#25Agreed. Fuck Benchmark. Travis makes each partner $1 billion personally and this is how they treat him? They should be blackballed by every great founder out there. I had respect for benchmark but not anymore. They are greedy assholes.
Does money absolve a founder from potentially fraudulent behavior?
Re: Benchmark Capital Sues Travis Kalanick for Fraud
#26Earlier quoted context omitted.
> My assumption is that both parties will settle quickly but I could be wrong. What makes you think that?
There is so much for both to lose if they delay - a settlement works better for the company and them
Eh? This is over control, not money. There is no "middle ground"; Benchmark wants Kalanick off the board and he wants to stay.
I expect a tooth-and-nail battle, with much of it leaking into the public.
Re: Benchmark Capital Sues Travis Kalanick for Fraud
#27wonder what this means for the CEO search, softbank funding etc. My assumption is that both parties will settle quickly but I could be wrong. Also not noted in the article is that while travis owns 10% of the equity stake, he has super-voting shares, such that him, Ryan Graves, and Garret Camp as a trifecta hold controlling interest IIRC.
Travis has lost the support of Ryan and Garrett apparently (per several reports over the last month/Garrett's statement/Ryan stepping down from operating role). Seems like a man on an island at this point.
Re: Benchmark Capital Sues Travis Kalanick for Fraud
#28The key point of conflict appears to be the following: The suit revolves around the June 2016 decision to expand the size of Uber's board of voting directors from eight to 11, with Kalanick having the sole right to designate those seats. Kalanick would later name himself to one of those seats following his resignation, since his prior board seat was reserved for the company's CEO. The other two seats remain unfilled.…
Control requires time, knowledge, judgement and implies liability.
You may just be good at getting funds and collecting dividends / next round money and that's totally cool. You may not have any plan for the future, and you may not want to go in jail when something goes bad.
Re: Benchmark Capital Sues Travis Kalanick for Fraud
#29Stakes: Per the complaint, Kalanick currently holds around a 10% equity stake in Uber, which most recently was valued at around $70 billion. Benchmark holds approximately 13 percent.
This is interesting. I thought HNers were saying Kalanick had the biggest stake, which is why the board couldn't fire him.
How does this work? If someone only has 10% equity, why was it so difficult to remove them? This is a useful tool for founders, so it's worth understanding.
Re: Benchmark Capital Sues Travis Kalanick for Fraud
#30Agreed. Fuck Benchmark. Travis makes each partner $1 billion personally and this is how they treat him? They should be blackballed by every great founder out there. I had respect for benchmark but not anymore. They are greedy assholes.
A question I've been pondering since the Martin Shkreli verdict, is fraud OK if the deceived parties still profit?
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