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 high-profile, 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 tech-focused 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.
