TPG co-founder David Bonderman: Uber exit after sexist quip

For decades, David Bonderman, the co-founder of private equity firm TPG, was known as the irreverent enfant terribleof the financial industry, one who took delight in making caustic remarks. But this week, he delivered a quip that crossed a line, costing him his role on the board of Uber and creating an embarrassing distraction for the ride-hailing group.

At a company-wide meeting to unveil Uber’s plan for overhauling its corporate culture, he interrupted fellow board member Arianna Huffington with a sexist joke, saying that having more women on the board just meant more talking. That remark came at the worst possible time, after allegations of sexism and sexual harassment had sparked multiple probes at Uber.

Mr Bonderman, 74, has long been regarded as one of the founding titans of the private equity industry, buying up troubled companies at bargain prices and turning them round.

Born in Los Angeles, he maintained something of a West Coast free-spirit vibe, even as he pursued a career in law and finance. He went to work for Texas oil baron Robert Bass in the 1980s, where his deals included a lucrative takeover of the American Savings and Loan Association.

He launched TPG in 1992 with co-founder Jim Coulter, and its founding deal was the highly profitable takeover of Continental Airlines. At one point, he sent his meal tray from a flight to Continental’s management to make his point about how inedible the food was. Along with TPG’s success, Mr Bonderman’s own fortune grew and today he is worth some $2.5bn, according to Forbes.

Even in his 70s, he continues to be seen as a rainmaker by many of his investors. “He’s a deal junkie,” says longtime friend and business partner Richard Blum. “He’s as smart an investor as I know . . . He can be contrarian, absolutely. He can also be a believer.”

That respect comes despite several large investments that quickly went bad about a decade ago. TPG and KKR lost all their money when they invested in TXU, the largest private equity deal, and the Texas utility went bust.

Mr Bonderman was also responsible for a TPG-led $7.5bn investment in Washington Mutual in early 2008, despite warnings that the timing of the investment, in what was already a growing rout in the mortgage market, was ill-advised. The government seized WaMu a few months later and the group lost every cent.

In recent years, TPG’s investments in Silicon Valley start-ups such as Uber and Airbnb have helped breathe new life into its portfolio. Mr Bonderman joined the board of Uber in 2013, when TPG and Google Ventures invested $258m into the then fledgling start-up. At the time, Uber’s chief executive Travis Kalanick hailed Mr Bonderman’s expertise as being essential to help Uber expand.

However Uber’s status as the biggest, most successful start-up in Silicon Valley has come under threat because of a series of mis-steps. Meanwhile, Mr Bonderman became one of the board members responsible for turning round Uber’s male-dominated, aggressive culture, following allegations of sexism and sexual harassment at the company.

Helping Uber with its clean-up act might seem like an unlikely role for a man who is often seen with beauties on his arm, and who represents an industry that has been slow in welcoming women into its senior ranks.

In many ways, the challenges now facing TPG and Uber are similar. Both companies are giants in their field yet remain private (although TPG still hopes to list eventually). Both have a founder-led culture that has made it hard for them to adapt at times. Both companies have, like their founders, struggled to grow up.