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Uber activity diagram11/21/2023 Type 2 decisions, which are most of the decisions we encounter, are changeable and reversible, like two-way doors. Type 1 decisions are consequential, irreversible (one-way doors) and hence have to be made methodically and slowly, with great rigor and deliberation. Jeff Bezos made this exact point in his 2015 letter ( ) to shareholders, where he introduced the notion of Type 1 and Type 2 decisions. When it comes to making decisions, have you wondered how to strike the right balance between being data-informed and getting stuck in analysis paralysis? It is easy to fall into the trap of wanting more data trying to get to a perfect decision. Without losing money.Ĭhasing profitability doesn’t mean playing it safe. At a $36B runrate he’s still on track to double in ~3 years. As a result, he got both growth AND profits. He acquired Drizly for $1B, Cornershop for $1.4B, and Postmates for $2.6B. Anyone can get to profitability by cutting. Observation: Focus on LTV first, margins second.ĥ. In the long run, they’re more profitable. But since UberOne members order more and have higher retention, they have higher Lifetime Value. Because of all the offers UberOne members get, they have lower margins than regular members. He leaned into UberOne, their Prime-like membership, and grew it to 12M members (2x YoY). Observation: Only play games you can win.Ĥ. He left markets where they weren’t positioned to be a #1 or #2 player. Observation: Focus only on what’s most important.ģ. He disposed of their self-driving unit, their $400M stake in Careem, and their $392M stake in Zomato. He sold off business units that weren’t strategic. He reacted quickly to the pandemic and reduced staff by nearly 20%. Here’s what he did to get to profitability:ġ. Uber CEO Dara Khosrowshahi is one of the best in the game. Yesterday, for the first time in history, Uber became profitable. It might be a down market, but I believe brighter days are ahead for Twilio, with the right leadership and the right amount of "conservatism" and "aggression". Not exactly a one to one mapping with the Uber story, but the common themes are astonishing: 1) Going lean and aggressive can happen at the same time. He betted on data and AI as the strategic differentiator of the company, as an aggressive move. He leaned to CustomerAI, and partnered with AWS and OpenAI, to really tap into the massive potential of customer data in fueling AI powered customer engagement solutions. He sold off business units that were not aligned with the company's strategic vision, including the IoT business to KORE, and the ValueFirst business to Tanla. And yes, is right, sometimes you have to run as lean as you can.Ģ. To respond to oversized growth during the pandemic, he reduced the workforce by 28% via two company wide layoffs and restructuring efforts. Interestingly, our CEO Jeff Lawson has some some very similar things to push the company out of a down market, onto a path of profitability, how? Please hear me out :)ġ. Saw this post about Uber, and I could not help but draw a comparison with what has been happening at Twilio in the past few years.
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