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The Uber cost of not playing by the rules

Wednesday, December 10, 2014 - 02:17

Car-sharing startup app Uber has massive ambitions, but its tactics are starting to backfire, despite support from Silicon Valley. Bobbi Rebell reports.

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Uber the popular and growing startup car sharing app is now running into some heavy traffic. Uber is flush with cash - a recent round of financing put its valuation in the $40 billion neighborhood - but it's "act first and face the consequences later attititude" has the company now facing some serious challenges and hurdles. Mike Paul is President of the Reputation Doctor: SOUNDBITE: MIKE PAUL, PRESIDENT, REPUTATION DOCTOR (ENGLISH) SAYING: "Right now their positioning is that of a cowboy, and I think as a young entrepreneurial company they were initially very comfortable with that position. guess what it will all ripple out in the end. I think they are getting some pushback with their reputation and they are learning you know what? we've grown significantly. we have to act more corporate than entrepreneurial." It's been a really bad week for Uber - it was banned in India's capital New Delhi after one of its drivers - who had a criminal record - was accused of raping a passenger ... Spain and Thailand are also barring it for public safety concerns. And recently, a German court said no way and France is mulling a no go as well. In the U.S. it is even getting push back in its home state of California - where both San Francisco and Los Angeles have filed lawsuits over safety issues - saying Uber is misleading customers about its background checks on drivers. Another west coast city, Portland, Oregon, sued to stop Uber from operating. And the Chicago city council is voting on a resolution creating a competing online taxi cab booking system. Similar moves, sponsored by taxi unions, are underway in other cities. But for now - the money is there - and counting on the company's massive global ambitions. SOUNDBITE: MIKE PAUL, PRESIDENT, REPUTATION DOCTOR (ENGLISH) SAYING: "I don't think the valuation for example has taken a hit thus far I think it's a wait and see. They still think there is a lot of progress with a company like this but when you hear that they are in 250 cities in 50 different nations and they have grown approximately 6 times what they were 12 months ago if i were advising them I'd say whoa whoa whoa hold your horses. " Nevertheless, Uber will continue to face issues overseas and close to home over vetting driving and challenging traditional taxi services.

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The Uber cost of not playing by the rules

Wednesday, December 10, 2014 - 02:17