Apr 8, 2024, 8:00 AM ETInterview

Bastian Lehmann: How the Uber Deal Went Down and How a $2.65BN Deal Turned into $5BN | E1137

The final deal value was nearly $5 billion upon closing, with the transaction structured with no "collar" (protection against share price fluctuation), allowing the founders to benefit from Uber's stock rise from ~$31 to ~$53–55.
At the time of the acquisition, Postmates held just under $100 million in cash and reported single-digit negative gross profit margins.
The company returned to profitability within two to three quarters post-closing, generating positive cash flow.
While initial reports suggested an emergency cash crunch, the founders confirm they were planning an IPO and were not "out of cash" but rather chose to consolidate the market.
Negotiation priorities focused on securing "no breakup" clauses and eliminating price collars rather than maximizing the initial headline valuation.

Basti was born in 1977 in Germany, where he grew up in a modest household during the post-reunification era.
His parents' divorce when he was six profoundly impacted his life, with his mother taking three jobs to support Basti and his brother, fostering a deep sense of grit.
He famously "embezzled" international calling time as a teenager by calling MCI/AT&T in San Francisco, pretending to be a service agent to verify card numbers and PINs for free US internet access.
Basti's initial motivation for building wealth was explicitly tied to ensuring his mother had financial security, a promise he made to himself around age 14.
He rejects the concept of "luck," attributing success to determination, grit, and hard work, noting that "you make your own luck."

The on-demand delivery market became a "battleground" where capital deployment for advertising and market share was the primary differentiator for five to six years.
Postmates raised approximately $900 million total; competitors raising larger rounds created pressure that necessitated significant capital deployment to survive.
Basti challenges the narrative that delivery units were fundamentally flawed, arguing that profitable unit economics were achievable at scale, similar to the eventual success of DoorDash.
Founders Fund's Peter Thiel and Brian Singerman were the earliest investors in Series A, driven partly by the lack of other available capital.
Basti advises founders to avoid "educating" investors who lack conviction, viewing such VCs as red flags who may invest in competitors if the founder has to convince them twice.

Dara Khosrowshahi (Uber CEO) is praised for his "calculated risk-taking" and high-autonomy leadership style, which allows executives to execute without excessive micromanagement.
The acquisition discussions began around the time of COVID-19, with Uber recognizing the strategic value of Postmates to bolster their struggling Uber Eats division in key markets like Los Angeles.
The deal process was described as "pleasant" and relatively smooth once leadership aligned, despite the "info war" that often accompanies founder-vs-giant conflicts.
Basti notes that he did not get to celebrate the exit with the 2,000+ employees due to COVID-19 restrictions, a significant emotional loss for a founder accustomed to a "church-like" community.

Basti characterizes 99% of Venture Capitalists as "sheep" who follow herd mentality rather than making courageous, independent bets on anomalies.
He advocates for a "separation of board dinner and board meeting" strategy: holding informal dinners beforehand to resolve tensions and present data, leaving the formal meeting for focused decision-making.
As a second-time founder, he benefits from the ability to select co-founders and VCs (specifically Mark Andreessen) without needing to prove himself, allowing for greater efficiency.
Basti does not take a salary for his new venture, TipTop, removing personal financial pressure and allowing for bold, long-term decision-making.
He views the fundraising process for his new company as taking nearly a year due to regulatory clearances (DOJ) and share transition logistics, rather than a single moment of celebration.

Basti predicts the "phone is dead" as a primary form factor, forecasting a shift toward voice-operated systems or implants, with Apple currently trapped in an "inventor's dilemma."
He argues for "inference computers" as a distinct home device running local, personalized AI models on chips, rather than relying on expensive cloud-based LLMs.
Localized inference is preferred for privacy, real-time responsiveness, and cost-efficiency (electricity vs. token costs).
While he acknowledges OpenAI's impact, he believes the future of AI lies in specialized, smaller models and robots (citing Figure AI) rather than just chatbots.
He believes incumbents are vulnerable not because of external startups initially, but because internal organizational cracks (e.g., Vision Pro returns) eventually create opportunities for new disruptors.
Basti's primary existential risk regarding AI is not "evil AI" killing humanity, but humanity failing to accelerate AI development to solve climate change and achieve multi-planetary survival.

Basti's new company, TipTop, is a "cold start" Series A funded by Andreessen Horowitz, designed to test hypotheses and pivot if necessary without external pressure.
His personal philosophy on failure is that "nobody cares" after a minute, emphasizing the need for speed and resilience over perfection.
He plans to return to a passive lifestyle by 2034, attending his children's sporting events (likely basketball) with no active company responsibilities.
He respects other founder-CEOs who stay in leadership roles, specifically citing Patrick Collison (Stripe), Zach Perret (Rippling), and Max Levchin (Affirm).