Interviews and Reviews

Emil Michael: Driven to Create Through Challenges and Opposition

Emil Michael

Born in Cairo in 1972, businessman, executive, philanthropist, and entrepreneur Emil Michael has followed a fascinating path that’s led him through the halls of Harvard University, onto lists such as Fast Company’s Most Creative People in Marketing and Most Creative People in Business, and into roles that have included Chief Business Officer of Uber and Chief Operating Officer of Klout.

At one point, Michael was even vetted in consideration for the Cabinet post of Secretary of Transportation. Michael served on several non-profit organizations’ boards, including the Pentagon’s Defense Business Board. He’s also an avid investor, with some of his notable startup investments including Brex, GoPuff, Revolut and Bird.

Recently, Andreas Penna sat down with Emil Michael to discuss his approach to life and business, what he thinks of the unique global landscape we’re experiencing today, and where the world is headed next.

Andreas Penna

What’s going on Emil? How are you? Can you tell us how the quarantine is going?

Emil Michael

Yeah. Miami Beach and we’re on quarantine number two right now, or maybe one and a half. That just re-instituted the curfew and closed restaurants down. So really unfortunate, because we didn’t get hit hard last time, but now we’re getting hit really hard here in Miami. So we’re just hunkered down at home.

Andreas Penna

It is unfortunate how everything is kind of oscillating between ups and downs, but I think we’re going to get through this.

Emil Michael

We’re definitely going to get through it. Let’s just not Twitter doom scroll and get depressed.

Andreas Penna

So Emil, a bunch folks know that you are an incredible business person, but what folks don’t also know is that you’re a recent Dad. I think your baby daughter could be your greatest achievement yet, Emil. Is that right?

Emil Michael

That’s what it feels like. I’m 47, right? She’s five months old. I waited quite a long time and I’m now thinking, man, I should’ve done this sooner.

Andreas Penna

I’ve heard that narrative from so many people and you certainly look super happy. So she’s five months old, probably a great time, well a challenging time to be a first-time dad or have a child that young. But at the same time, it may be a rewarding time because you literally can just spend as much time together because there’s nowhere to go. Everyone’s quarantined.

Emil Michael

I was thinking that the last time I haven’t been on a plane for work for five months, I was probably in high school. So I get a lot of quality time. So I think it’ll be super memorable for me to have had that much time with her in the early part of her life.

Andreas Penna

That’s awesome. Alright, let’s talk business. So obviously Uber is a darling growth story during your tenure. One of the greatest growth stories in Silicon valley, however there was also obviously a lot of controversy around those times. What can you share on that and give color on anything that people don’t know?

Emil Michael

I mean, it’s one of the lessons I’ve learned is that if you’re building something important, no matter what it is, it’s going to have some controversy on it, right? If you look at Facebook today, Amazon, Google, the heat on the big companies, and Uber sort of had that heat early because we were running against the regulators who were protecting the taxi industry. So everything we did was poking the bear, so to speak. So we were in the news a lot. We were always a company that someone wanted to talk about because on the other side of it, people love the service. It was changing people’s lives. I mean, you remember living in San Francisco without Uber. In fact, I remember trying to get around the city.

Andreas Penna

It was awful. I remember those.

Emil Michael

So the things that were controversial were also the things that made it successful, the sheer ambition of it.

Emil Michael

What people don’t know is that what made Uber possible was the iPhone. Before the iPhone, there was no way to have a driver have a phone in the car. And therefore when he or she was driving around, you couldn’t track them. So the first version of the iPhone made it possible. And then the other crazy thing about it is the battery used to die in the iPhone, even when you had a charge in a car, because the battery was so small, and then there was the iPhone 3 when you finally could charge a battery and keep it charged in the car. And that’s when Uber really took off, literally from battery life.

Andreas Penna

And the GPS component, right? I think the second iPhone, was it the second or the third where they enabled GPS? It was the first one didn’t have it.

Emil Michael

It was in the first, but it was more like they applied steroids to the nextones. So it was this sort of the very first mobile app that brought real world value to the phone.

Andreas Penna

And so part of the growth pains of hyper scaling and during your time there as well, a lot of political and policy and regulatory fights across, not only in the U.S. but globally. Disclaimer, I was also the first round seed angel investor in 99 Taxis in Brazil, which was the Uber of Brazil, which was the number one competitor. So I know the space pretty well. And, I know you guys pretty well at Uber. Of course. So during that time, I remember even in Brazil, a fight between 99, a fight between Uber, a fight between politicians, local cab companies. And, from that, I think Uber remains to be one of the greatest growth stories, but you know, definitely collateral damage there, but a lot of learnings.

What did you learn from your experience at Uber and how has that made you a better leader going forward?

Emil Michael

Well, I mean, God, there was so much to learn. I think one of the macro lessons I’ve learned is if you know, and this goes for hyperscale companies that are trying to hyperscale, so your revenues, your customers are going like this, the curve is straight up to the right. The thing is it’s easy to do is ignore the company building because, I distinguished the business building and company building. Business is going like gangbusters, right? The company has to track alongside of that and that means legal, finance, HR manager training, all the stuff that make a company sort of bulletproof. And try to track those together if you’re going to hyperscale, if you don’t, you’re going to get into some trouble. We have a lot of young employees, although we’re all doing their own thing without a lot of guidance, one of the big leadership lessons I learned for a hyperscale company.

Andreas Penna

So how do you manage to parallel track growth? As you just mentioned, all the HR process, people management, all these things, back office, what is the one piece of advice? If you could go back to make, to make that growth, a better experience for everyone at the company and yourself, and what would be the one piece of advice to manage growth across all these functions that you would give? Because it is a real tough thing to do.

Emil Michael

It’s really tough. It’s it all comes down to the percentage of time. You’re devoting to it. If you devote 99% of your time to growth at 1% to company building, that’s what you’re going to get. You’re more like 70, 30, and not only are you going to kind of grow almost as fast, you’re going to sustain that growth for longer because the company is going to be solid and be able to get it to handle it. So I think that trade off, figuring out how much time the mind share the executive team spends on the company building is the sort of thing you have to really think about.

Andreas Penna

Got it. What did you learn? Third question. What are you most proud of at your tenure with Uber and I think if everyone’s listening, given that you’re the fundraising ninja, probably the preeminent best person out there raising $15 billion, the most amount of funding for private company in history, what are you most proud of? What is the secret sauce for founders out there or individuals in a similar role to what you were at Uber to raising 15 billion? So two part question.

Emil Michael

Okay. So the thing I’m most proud of is probably Uber’s experience in China. I mean, I remember every single CEO I talked to, it was like, do not bother go trying to do a business in China. Don’t try it. It’s not worth your time. You’re going to get killed by local competitors. The government’s not going to be on your side. And we went into China and we fought like hell against a local competitor to the point where we ended up merging our kind of business with theirs and now we own, Uber owned at the time, 20% of DiDi, which from a value creation somewhere that’s $10 billion of value. And no American tech company had done that as ferociously and fast as us. And I got to be the executive sort of most in charge of China. And it was incredible. I spent maybe a hundred days there going out to various cities and it was an incredible experience.

Emil Michael

On the fundraising side, the number one piece of advice I have to entrepreneurs out there is, don’t get attached to an investor, get attached to a process. And what that means is decide what your process for fundraising is going to be, and try to be unemotional about firms and investors that come in and assess them objectively, don’t fall in love. If you fall in love, you may end up taking a lower value deal than you should take or you may evaluate how much you like that person, not about what their firm could bring to the table. And so you want to be clear-eyed about choosing that. So we always said, we were at Uber things like we’re going to spend four weeks on fundraising. We’re going to do 15 meetings and whatever valuation it spits out, it spits out. We’re going to take. We’re going to test the market and we didn’t get patched to evaluation and too much.  This is not to say that some investors don’t add more value relative to others, but make that one of the criteria not the only criteria.

Andreas Penna

That’s interesting. I always thought through each funding, subsequent funding round that Uber had these monster step ups and valuation that you guys had some pre money valuation or something in mind, you made it such that it was very much market driven and market led

Emil Michael

Very, very much market driven market. And whenever the number comes out, you’re not happy or sad about it because you didn’t set your expectations like that. And it’s very hard to be disciplined to do that Andreas. But if you could detach yourself from an outcome  and just essentially say, I’m going to make sure it’s a fair process. That’s going to be market-driven then whatever comes out of it, that’s what you’re worth.

Andreas Penna

That’s the first time I’ve heard it put into perspective like that. And I can totally see the value in that because everything is expectation management. So if you go into something that, Hey, it’s a, it’s a free market mentality and where you end up, it’s neither good nor bad it is what it is. And you don’t have this false expectation of either being disappointed or even being elated. It’s just, that’s very much kind of your ethos and perspective towards fundraising. And I think that’s a really valuable one that I had. I haven’t heard that perspective before. So thank you.

Emil Michael

The other thing Andrea is, when you don’t have an expectation, more investors participate in the process because the other alternative is to say, “Hey, I want $200 million” and investor looks at it and goes, “Hey, I’m out. That’s not worth that”. Even before they look at numbers, if you don’t have an expectation, they’re more likely to participate because they will feel like the price will be market-driven

Andreas Penna

get to be more involved.

Emil Michael

Yes.

Andreas Penna

Got it.

Emil Michael

It means you have more bidders at the table with the company.

Andreas Penna

That’s great. That’s a great piece of business ninja wisdom. Thank you, Emil. What are you most excited about these days?

Emil Michael

What am I most excited about? The delivery of stuff as is in its heyday, whether it’s,  GoPuff, DoorDash, Instacart; all over the world, those are blowing up.

Andreas Penna

Postmates actually, I just realized right now this Eureka moment, Postmates, Uber, pretty appropriate.

Emil Michael

I’m not super happy about the price they paid, becauseyou know, it was expensive.

Andreas Penna

Delivery services in general are what gets you most excited. I think you’re also an investor in Rappi as well right?

Emil Michael

Yeah. And Rappi too, I’m excited that it’s going to fast forward the future on delivery services. The other things that are hard not to be excited about is all this happening in the enterprise and the work at home software companies, which is truly game-changing. It’s going to be a big factor in the way we work as an industry and as a country and frankly, with the world. It’s going to decrease the importance of Silicon valley and increase the availability of tech jobs everywhere else in the country, in the world. So I think it’s a real democratizing force in a lot of ways.

Andreas Penna

What is the most kind of interesting aspect of enterprise tech and process management? Are there any specific verticals or horizontals that really get you most excited about that?

Emil Michael

It’s interesting. It’s the unbundling now, we’re doing the unbundling. So now you have Slack and you have Zoom and you have Airtable to compete with Excel. All these things. The one thing that I think is still missing in a big way, and I’m waiting for someone to invent, is identity management across mobile and your desktop or whatever. No one has solved the password problem known to solve the who am I problem. And it’s insane because our lives are getting way more complicated with every new service we sign up for.

Andreas Penna

That’s really funny after this, after the show, I’m going to send you an email with a company that I led the seed round of called journey.ai. It’s trusted management and identity using a double-blind biometrics. So I’m happy that you’re saying that that is what’s most interesting because I agree with you. And that’s what got me really excited. That’s a great coincidence. What sectors of investment are you most interested these days? You’re an active investor for folks who are watching the show live now, or later, how should they pitch you or what are you most interested to invest in, in the next, let’s say 12, 24 months.

Emil Michael

Well, I still think Fintech is in its third inning, look at what’s happening in Brazil and Latin America, out there starting to replicate the Alipay.. Even PayPal and Square, and all these payment-oriented companies are making progress in the US so I still think there’s a lot of innovation around payments in every continent. I think virtual restaurants are a big deal, now that delivery has taken off. Like you’re going to be able to build a restaurant for way cheaper.

Andreas Penna

You mean like ghost kitchens?

Emil Michael

So ghost kitchens are the real estate, then inside the real estate, someone has to cook the food and make the menu.

Andreas Penna

Okay, yes.

Emil Michael

And that used to be a restaurateur, who had to spend a half a million dollars to open a restaurant in San Francisco. Now you could do it for a fraction of that in a cloud kitchen and anyone can do it. So I think that’s interesting, I think the identity management, stuff’s interesting and those are the key sectors I’m looking at right now.

Andreas Penna

Awesome. Awesome. Thank you for that. We’ve got five minutes left, so we’re going to go into some fun questions, but before we do that, Emil, congrats again on the baby daughter, given that your a father and the state of the world at this time, there’s just so much going on across many different areas. What is one thing you would like to be different about our world for your daughter’s future?

Andreas Penna

and I know that’s a packed question, but 2020 is, is probably the craziest year anyone has dealt with.

Emil Michael

But you know in some ways, besides the virus, we’ve been building up to 2020 in terms of the acrimony that we are having within the country and between countries and so on and what social media has done in terms of divisiveness and allowing people to sort of be bitter enemies who’ve never met each other. And that sentiment is super destructive. And what you’re seeing online today, it’s just sort of like the continuation of that. I don’t know what the answer is, but man, I hope she doesn’t have to face such a polarized world and society. So I’m looking for ways that I, and others around me can help sort of contribute to a new way of looking at those kinds of discussions happening in a better way.

Andreas Penna

Okay. Thank you for that. A couple fun questions, obviously. I don’t think you’ve been to a movie theater, but what have you been watching on, on iTunes or Netflix? What’s your favorite recent movie?

Emil Michael

Well, I don’t know. I probably have a good company watching the Hamilton streaming thing came out on Disney plus. That’s awesome. And then I’ve been watching all the documentaries on Netflix, right? That everyone’s watched the Versace one, Inside Bill Gates Brain one.

Andreas Penna

I love the bill gates one.

Emil Michael

Yeah, it’s fantastic. And then really the sinister was the Jeffrey Epstein one.

Andreas Penna

I saw that on, that very insightful. And we had no idea how the rabbit hole actually went.

Emil Michael

Wow. It sort of gives you a sense of the magnitude of that crime. So those are the things, but like on the happy side it’s been, Hamilton, which is just a crowd pleaser times 10, you know?

Andreas Penna

Actually I haven’t seen it. So I think I’ve got to put that on my list. When Miami reopens, where’s the one place you would go to eat? Where’s your favorite place in Miami you’d go to? First place you’re going to go.

Emil Michael

Probably that Papi Steak restaurant, have you been there? It just opened last year and it was this great place in South Beach and a lot of celebrities go and it’s fun. It’s right near the beach. People go there before they go out. It’s super social, but it’s packed. So it’s exactly the wrong place to go. That will be the first place to go back to when it all opens again.

Andreas Penna

I have one friend who has said that there’s a place here in LA, it’s a cats and coffee. It’s like a cat cafe where you get to play with kittens and have coffee and stuff. Maybe you’d stay and play with puppies. That’s an interesting concept. What are you reading these days? Where do you get most of your information from what’s your main source?

Emil Michael

Yep. I use Twitter as the best source for information that links you back to the major publications. I’m trying to stop that. I deleted Twitter off my phone and I just use the browser on the phone to do it, to limit my intake, cause it’s just all doomsday stuff. But so that’s unfortunate in terms of reading, what did I read last? I feel like I haven’t touched a book in a while because the news has been so all consuming in the last few days. So I don’t know if you’re having that same feeling?

Andreas Penna

Any particular blogs on technology that you know, a lot of folks like TechCrunch or is there? what’s your?

Emil Michael

The best publication that doesn’t make my blood boil one way or the other is like The Economist. And Axios has that daily email that they send out that is a good summary of what’s going on in tech world, pretty neutral, sort of calm stuff. So that’s kind of what I like.

Andreas Penna

Awesome. Final question. How are you staying fit these days?

Emil Michael

That assumes I am staying fit.

Andreas Penna

Do you have a Peloton? I feel like half the people have either got a Peloton or they’re using some sort of fitness app.

Emil Michael

No, no. We have a Peloton and walks with the baby, but that’s about it, you know it’s a Peloton, whenever I could kind of muster the energy to do it and then walks around where I live and that’s that’s about it. But do you know, the baby keeps us pretty active?

Andreas Penna

I mean, of course. Yeah. Amazing. Thank you. Thank you Emil again, everyone. Emil Michael former chief business officer of Uber. This is the fifth episode of bizpod.ninja. For those who are going to be watching it, posts recording will be available on LinkedIn live as well as the website, every Thursday or Friday 25 to 30 minutes with various business ninjas around the world and their respective categories. Thank you, Emil, stay safe out there and congratulations again on the daughter and all the good stuff that you’ve been working on.

Emil Michael

Okay, take care of yourself Andreas. Thanks for having me.

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