Today, we wake up to the news that twelve-year CEO, Dara Khosrowshahi, plans to leave Expedia for the poster child of the sharing economy, Uber.
In 2015, Dara was THE highest paid CEO in the S&P 500, bringing in over $94 million. Much of that compensation came in the way of vesting stock options which he will be leaving behind with his departure. His vesting is reported in the same article to have hinged both on employment and on a stock price goal. Does Airbnb’s plan to go public effect Dara’s decision? Dara must see that Airbnb’s IPO and $30+ billion dollar valuation is going to impact Expedia’s stock price. At the same time, Uber must be planning an IPO of its own. Dara has been extremely successful during his time at Expedia, and pulling of a successful IPO could lead to a serious payday.
Airbnb aside, it is now publically known that Google is testing vacation rental search in it’s hotel tools, a move that could cripple Expedia.
Sure, Uber being privately held (for now) offers far more flexibility, but it certainly has it’s share of problems. One such problem also faces Expedia’s largest rival in the homesharing world, Airbnb... regulations. In the US, Expedia is the market leader in vacation rentals, owning the traditional rental market. Airbnb has seemed to put an emphasis on growing the traditional vacation rental market, but hasn’t yet made much headway from what I can see. However, Airbnb owns the (highly regulated) urban market. Could Dara simply be trading headaches. Avoiding those brought on by growing Expedia’s urban short-term rentals, but adding new battles with taxi owners and operators?
Dara’s move may temporarily be a financial step back, but the signs seem to show Expedia is peaking and Uber could be the next big payday.