Miss­ing Saudi jour­nal­ist is new dilemma for Uber

CEO and other prom­i­nent speak­ers say they won’t at­tend con­fer­ence in Riyadh

The Mercury News - - Business + Technology - By Levi Su­ma­gaysay lsuma­gaysay@ba­yare­anews­group.com

Uber CEO Dara Khos­row­shahi was sched­uled to speak later this month at a huge busi­ness con­fer­ence in Saudi Ara­bia’s cap­i­tal Riyadh that’s known as “Davos in the Desert,” but he will no longer be at­tend­ing af­ter the dis­ap­pear­ance of a Saudi jour­nal­ist.

“I’m very trou­bled by the re­ports to date about Ja­mal Khashoggi,” the Uber CEO said in a state­ment sent to this and other me­dia out­lets late this week. “We are fol­low­ing the sit­u­a­tion closely, and un­less a sub­stan­tially dif­fer­ent set of facts emerges, I won’t be at­tend­ing the FII con­fer­ence in Riyadh.”

Other prom­i­nent speak­ers, at­ten­dees and spon­sors of the sec­ond an­nual Fu­ture In­vest­ment Ini­tia­tive are also pulling out, cit­ing con­cerns about the miss­ing Khashoggi, a Wash­ing­ton Post colum­nist who was crit­i­cal of the his­tor­i­cally op­pres­sive Saudi govern­ment. Those whose plans have changed or are “on hold” in­clude AOL co-founder Steve Case, and me­dia out­lets and jour­nal­ists such as Ari­anna Huff­in­g­ton.

The Turk­ish govern­ment has told the U.S. govern­ment it has record­ings that prove the jour­nal­ist was killed in­side the Saudi con­sulate in Is­tan­bul ear­lier this month, ac­cord­ing to the Wash­ing­ton Post.

That raises se­ri­ous eth­i­cal con­cerns for the tech in­dus­try, which has been rife with them lately, in­clud­ing over do­ing busi­ness with

the U.S. govern­ment and China, or tak­ing money from Rus­sia.

“This is no dif­fer­ent than the cal­cu­la­tions com­pa­nies have to make when­ever they con­sider re­la­tion­ships with re­pres­sive gov­ern­ments, or even work­ing within coun­tries gov­erned by re­press­ing regimes,” said Irina Raicu, di­rec­tor of the In­ter­net Ethics Pro­gram at the Markkula Cen­ter for Ap­plied Ethics at Santa Clara Univer­sity, on Fri­day.

Be­sides Uber, plenty of other tech com­pa­nies have ben­e­fited from Saudi pri­vate and govern­ment in­vest­ments, di­rectly or in­di­rectly. Also, new Saudi Crown Prince Mo­hammed bin Sal­man’s Vi­sion 2030 plan for his na­tion’s fu­ture in­cludes fur­ther de­vel­op­ment of its dig­i­tal in­fra­struc­ture and re­mak­ing its econ­omy to re­duce de­pen­dence on oil. In April, MBS, as the crown prince is

known, vis­ited Sil­i­con Val­ley com­pa­nies such as Ap­ple, Google, Face­book and Palan­tir Tech­nolo­gies, the data startup co-founded by Peter Thiel, and met with their top ex­ec­u­tives. And in Au­gust, Tesla CEO Elon Musk caused a stir when he said he had se­cured fund­ing to take his elec­tric-car com­pany pri­vate. It turned out he was talk­ing about a ver­bal agree­ment with Saudi’s sov­er­eign-wealth fund, which didn’t pan out.

Uber’s ties to Saudi Ara­bia may be among the deep­est, or at least most high­pro­file, in the tech in­dus­try. In 2016, the San Fran­cisco ride-hail­ing com­pany — the most valu­able startup in the world — re­ceived a $3.5 bil­lion in­vest­ment from the Saudi Pub­lic In­vest­ment Fund, and along with that put the man­ag­ing di­rec­tor of that fund, Yasir Al Ru­mayyan, on its board of di­rec­tors. He ap­pears to re­main on the board, and Uber on Fri­day did not re­turn a re­quest for com­ment about him.

Then, in 2017, Uber —

which has a cur­rent val­u­a­tion of $72 bil­lion — re­ceived two fund­ing rounds that to­taled about $9 bil­lion from Soft­Bank’s tech­fo­cused Vi­sion Fund, ac­cord­ing to me­dia re­ports. That Soft­Bank fund re­ceived nearly half of its $100 bil­lion, or about $45 bil­lion, from the Saudi govern­ment, and is ex­pected to be re­ceiv­ing an ad­di­tional $45 bil­lion from the Saudis for a sec­ond Vi­sion Fund.

The Vi­sion Fund has also put money into tech com­pa­nies in­clud­ing GM Cruise, ARM Hold­ings, Nvidia, Do­or­dash and Slack, ac­cord­ing to Re­code.

“The Saudis have for the most part tried to sep­a­rate their for­eign pol­icy goals from their busi­ness goals,” said Allen Weiner, di­rec­tor of the Stan­ford Pro­gram in In­ter­na­tional and Com­par­a­tive Law and co-di­rec­tor of the Stan­ford Cen­ter on In­ter­na­tional Con­flict and Ne­go­ti­a­tion, on Fri­day. Sov­er­eign-wealth funds are “ul­ti­mately mo­ti­vated by the bot­tom line,” he said. “They’re not try­ing to use Uber as the voice of Saudis in the U.S.”

But Weiner added that “we’re see­ing sig­nif­i­cant changes in Saudi Ara­bian pol­icy un­der the in­flu­ence of the crown prince…. this is an im­por­tant time, we don’t know if it’s busi­ness as usual with the Saudis.”

Bin Sal­man was named crown prince in 2017. The thirty-some­thing prince has been known to be more so­cially lib­eral, but there are ap­par­ently grow­ing ques­tions about his bru­tal­ity.

As for other tech com­pa­nies with Saudi ties, Prince Al­waleed bin Talal, a nephew of the king has in­vest­ments in Ap­ple, Twit­ter, eBay and Lyft ei­ther per­son­ally or through his in­vest­ment firm, King­dom Hold­ings. He and many other wealthy Saudi Ara­bi­ans were jailed last year tied to an anti-cor­rup­tion crack­down or­dered by the crown prince. Bin Talal was re­leased ear­lier this year.

Khos­row­shahi

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