tv The David Rubenstein Show Peer to Peer Conversations Bloomberg April 25, 2020 9:00am-9:30am EDT
david: most people would say, if you are a managing director at goldman, life can't be much better than that. why did you choose to leave? jean: my ex-boss said, i can't believe you are joining a taxi company. david: what are you most proud of achieving as the president of didi? jean: for the company, i think i am extra proud we are providing 10 billion trips per year and filling a need. david: are you thinking about going public? jean: we do have an ipo timetable. let's put it that way. >> would you fix your tie, please? david: people would not recognize me if my tie was fixed, but ok. let's leave it this way. all right.
i don't consider myself a journalist and nobody else would consider myself a journalist. i began to take on the life of being an interviewer even though i have a day job of running a private equity firm. how do you define leadership? what is it that makes somebody tick? one of my friends invested in uber a number of years ago. it was at a $3 billion market value. i said he was going to lose all of his money, no ride-hailing company can be worth $3 billion. in fact, it turned out to be worth staggering sums of money and now it is publicly trading. i had the same reaction when i heard of didi, an uber-like company in china. i did not think it would catch on but i was wrong again. today it is the single largest ride-hailing company in the world. the person running the company is a young woman from china who
rose up because of her hard work and intellect and now she is the president of didi. it is an incredible success story. she is one of the best known women business leaders in china, an extremely intelligent person who is clearly going to make the company even more successful as she continues to lead it. we are here with jean liu, the president of didi, the largest mobile transportation company in china and one of the largest in the world. when didi was started in 2012, it wasn't the first or only company doing this, is that right? jean: there were 30 players doing the exact same thing. david: did you have anything that was better than the other 29? what were your advantages over the other companies? jean: we worked really hard. we worked really hard. for example, there were a lot of very strong competitors, right?
there was big competition and we sat down together to think about what is our strategy and how can we provide better value? we launched four business lines in three months in 2015. there were a lot of moments that we worked really hard and tried to catch up. david: there is another company in the u.s. called uber, which you are probably familiar with. jean: yes. david: when uber started, it grew quickly in the u.s. and other parts of the world, and also had a division in china. in many places, uber said, we will roll over our competition. but in one country, they were not able to do that, and that was china. in china, you ultimately came to a deal where, in effect, you merged but became the parent company and uber is an investor in your company. is that right? jean: yes. david: are you also an investor in uber? jean: yes. small. david: your company has grown to the point -- how many riders do
you have a day on your main taxi hailing business? jean: we have hundreds of millions of users every month. hundreds of millions. david: you have more users every month than uber? jean: that's right. david: today, what are your other businesses? jean: talking about uber, i have to say, we are thankful for the competition, it makes us better and stronger. when uber first came to china, their war chest was bigger than our market cap. so because of competition, it helped us to push ourselves to launch different product lines. starting from taxi, we launched private cars and different prices, black premier, and express line. and then later we had a social carpooling product. now we have bicycles and electric bicycles. we probably offer more than 10 services to our users.
david: most chinese companies that are technology leaders like alibaba, tencent, baidu, have dominant positions in china, but so far, they have not taken dominant positions outside of china. now, you are taking positions outside of china and building your business outside. have you been very successful outside of china so far? jean: i wouldn't call -- you know, we are very successful and we see very encouraging results. we are in brazil, mexico, colombia, in the latin market, and we are just entering into the australia and japan markets. david: how do you have to change everything for the different markets, are there different qualities you have to bring to the table? how do you make your service better for each of these countries? jean: i think we provide our service to the local people by combining two things, one is our global technology architecture, and then local innovation. we tailor make products for
different markets. a product in brazil and a product in japan are very different. unlike other companies who do copy-paste, cookie cutting for all the markets. it is a very different approach. david: you mentioned some countries you are in, you are not in the u.s. are you prohibited from being in the united states? jean: it's a very crowded market. david: it's not likely to happen anytime soon? jean: we hope -- if we can bring user value, we will consider it. if it is the same product and only compete on pricing, we don't see the point. david: the united states and china have a trade dispute that has been going on for a while. does that affect your business? jean: to be honest, it doesn't really impact our business because we are, you know, we are supported by local passengers and drivers. however, i think we have benefited from trading and sharing over years. it is unfortunate to see this,
and, of course, we hope it can get resolved. david: if i am an american tourist and i want to use your service in china, is it easy to do? do you have to speak chinese? jean: you don't at all, we have a great english version. we have a great english version and actually, a lot of our employees, colleagues, are from overseas, from different countries. especially now that we have a global business. david: uber is now publicly traded and losing a fair amount of money every year, a billion dollars plus per year or more. are you thinking of going public and are you losing money or making money? jean: well, we do have a specific ipo timetable, let's put it that way. back to the uber point, i am sure it is temporary and they will get through it. they are very diligent and experienced. for us, we think profitability is the natural result of the
value you create. there are two things in china that are different from other markets. first, rideshare is cheaper than car ownership. that is a huge value creation you provide to users. secondly, in china, we are going through a transition that people, you know, people urge for better life quality, for better lives, and people want to spend more money. david: the average age of your customers is below 30? jean: 20 to 30. actually, lots of them are students from college. david: people who are 50, 60, 70 are not your target audience as much? jean: they are, actually, and we definitely want to make our technology more accessible to everyone. david: back to the question of profitability, you are profitable? jean: in our core business. yes. we are. david: one of the businesses that is not your core business, i think you spun it off, was your automatic driving, autonomous.
why did you spin it off and when do you think autonomous driving will actually be very common? jean: actually, you know, i think it will take huge commitment for autonomous technology to mature technology-wise and also commercial-wise. and i think for a company to succeed in it you need to be prepared to spend money and human resources into it. we want to attract the top talent and make it independent. so people feel we want to join this as a young company. at the same time, we are at an advantage because we run the largest network. for a geo-sensing autonomous car to run, it is easy. largest network. in california, it could be easier than in beijing. we have a huge amount of data, so that makes us feel like we are in an advantage in that way. david: how many years away? jean: a long time. david: five years? jean: 5 to 10 years.
david: you spun that off because it will not be profitable in the near future. jean: we are still in the investment period. david: when you joined the company, you had a market value of $500 million more or less. let's say i want to invest at a $500 million valuation today, could you do that today? jean: not really, no. ♪
david: as far as your background, your father is well known in the business world in china, he was the founder of lenovo. jean: yes. david: did he say you need to go into something computer-related when you grow up? jean: not really. david: he did not put any pressure on you to get into the business? jean: not at all. david: you went to peking university and majored in computer science. jean: yes. david: so after you graduated --let me ask you, is it like the united states, where there are more men than women in computer science? jean: in our class, there were 36 students and 30 of them were men. david: you graduated and presumably did well, but then you decided to leave china to go to harvard. was it hard to get into? jean: it was hard to get into, yeah. david: you went to harvard and got a masters in computer science.
did you find it was harder or easier than you thought? jean: i would not say harder or easier. i think it is more interesting. and my key purpose to go abroad is to see the world and meet different people and it was totally rewarding. david: your english is, by my view, perfect. jean: thank you. not really. [laughter] david: pretty good. where did you get this english, at harvard or china? jean: i think i probably got in china. in china, we start to learn english starting from elementary school. if you have a good english teacher at school, you get ok. i would not call my english perfect. david: i think it is pretty good, it is probably better than mine. [laughter] when you graduated from harvard, did you decide to go to a great chinese firm like goldman sachs? jean: it was almost accidental to join goldman. i did a summer intern in the research division as an i.t. engineer in hong kong. i thought it was fascinating, what people are doing.
i decided i wanted to apply for a full-time job. that's why i ended up in the investment banking division in hong kong. david: you went there after you graduated, you went to hong kong, and you stayed there for 12 years and became a managing director. jean: yes. david: most people would say if you are a managing director at goldman, life can't be much better, so you are on your way up to the top. why did you leave? jean: a lot of people asked me that question, especially when i resigned from goldman. my ex-boss there said, i can't believe you're joining a taxi company. when i first moved back to beijing, i found myself struggling in the middle of the street with my three young children. i did not have a license plate to drive in beijing, and it is hard to get, it is a lottery system. it is really hard to hail a taxi. and then i met didi at that time, a very young company.
david: that company started in 2012? jean: yes. i met the founder in 2013 when didi was one-year-old. i wanted to make an investment at the beginning. i tried three times and failed three times. david: investment on behalf of goldman or yourself? jean: on behalf of goldman. i was a good goldman soldier. david: each time he said we don't need your money or what? jean: yes, because there were lines of investors waiting and they were faster. you know the due diligence process from goldman is actually quite strict. so i failed. but i always wanted to do something. and this thing seems, to me, to have a huge impact. i thought, why don't i just join him? david: how big was the company in 2014 when you joined? jean: let me see, it was valued at around $500 million, and 700 people, and the only product we had was the taxi hailing app.
when i joined, a lot of my friends or family advised me not, because china is very competitive and people think so much uncertainty. david: what do you say to the people who advise you not to join now? do you ever see them and say, if i had listened to you, i would still be at goldman? did you ever say that? jean: well, actually, i hesitated. i hesitated. when i sat down with the founder, i said, if you don't let me invest in you, let me join you. he did not back off, which surprised me. and then i got hesitant when people advised me not to. so we went to tibet together with a group of seven people, a soul-searching trip, and after that, i made up my mind. david: what position did you join at? jean: chief operating officer. david: you came from goldman sachs, but at goldman, you were not managing hundreds of hundreds of people, so how could
you be the chief operating officer? jean: although i did not manage hundreds of hundreds of people, but i did see a lot of business, i did talk to a lot of entrepreneurs. i think also is just in my genes. i want to build an organization that is of this generation. david: who were the big investors in didi in the early days? jean: there are number of them. the strategic ones that we have, tencent, alibaba, tim cook and apple, we also have a lot of very well-known financial investors. david: most of them, are they large institutional investors from the u.s. or china or all over the world? jean: a mix, it is diverse. david: when you joined the company, it had a market valuation of $500 million or less. let's say i want to invest at a $500 million valuation, could i do that today?
jean: not really, not even when you are nice and friendly. david: you are running one of biggest companies in china and one of the bigger companies in the world in terms of market value. so how do you keep that from going to your head? jean: it is a very challenging job. when i first joined the company, i thought it was a technology company, but now i know it is about people and safety. ♪
your cars and you don't like the service, what do you say? do they know who you are? jean: you know, the other day -- we have this assignment that we have to drive as well, to test the driver experience. and the other day, my colleague and i picked up this young guy and my colleague introduced me to him, this is our president and we want to survey you some questions and he was not impressed at all. he said, whatever. he said, why don't you give me some coupons if you want to survey me? so i am not a celebrity. david: you are now widely viewed as one of the most powerful women in business in china, women in business around the world, and not just a prominent woman, but a prominent executive, running one of the biggest companies in china and one of the bigger companies in the world in terms of market value. how do you keep that from going to your head?
jean: good question. actually, i think i have a tough job. it is a very challenging job. when i first joined this company, i thought it was just a technology company and now i know it is about people, it is about safety. last year, there were two terrible incidents that happened on our platform, two young girls got killed and it was devastating. for all of the senior executives, i.e. the 25-year-olds, we sat together and thought to ourselves, what is the next step? this is much more challenging than uber or other competition came in. david: was the death because the driver did something wrong? jean: yeah. the driver was a criminal. david: how do you screen those people in the future? jean: right, so after that, now we launched more than 40 product features about safety. facial recognition, route sharing, itinerary sharing. so there are 40 of them. but the challenge part is not about how committed we can be for safety, there are a lot of
dilemmas that i can't ask our data scientist for an answer to. it's a social problem. for example, one dilemma we face, do we allow drivers to reject drunk passengers? because there are a lot of internal conflicts from drunk passengers. they tend to assault drivers. drivers complain to us, hundreds of drivers complain to us daily, saying, can we reject this drunk passenger? do we allow it or not? david: so what do you do? jean: we put up a nationwide consultation forum and asked for feedback. 80% think we should. it surprised us because our original concern was if we let that happen, what if something bad happened to the drunk passenger? so what we do not encourage is a drunk passenger to ride by themselves, they need to be accompanied by a sober friend. david: how do you make sure the driver isn't drunk? jean: that is very easy. david: do you have a breathalyzer?
jean: we have something on the driver's cell phone, so if they drive dangerously, speed driving, hard brake, hard turn, we test immediately. before he can pick up others, we would do facial recognition and there are phone calls if we see anything random. david: in the united states, there is a lot of discussion about whether women are allowed to get senior positions in companies, and very few fortune 500 companies have ceos as women. is it easier in china for a woman to be ceo of a company or harder? jean: i think you can always be a ceo or president, but most times you are not likable. i think there is a glass ceiling everywhere, but i think in china, it's already a very encouraging work environment. for example, at didi, we have a women's network we launched four years ago. the key point is to encourage women to plan their career for
the next 30 years. when you were young, you must have planned your career for the next 30 years. but it is a challenge for young girls to say what i want to do for the next 30 years, because they feel their life will pause when they have kids and get married. we want to make sure our women employees feel they are empowered. that's why we encourage a lot of working from home, we encourage a lot of culture like that. a young mom can work from home one day a week. david: you have three young kids. do you work from home one day a week? jean: [laughter] david: you can do that? jean: i can't do that, but my kids are relatively big, 10 and nine. david: are they impressed with your job or they don't really know how powerful you are in the business world? jean: they know, but they don't think of me as powerful. they think, mom has a lot of problems, because i do discuss with them my work issues. in my view, the younger generation, generation z, they
have more access to information than we do. so i think that they have very independent views. we talk a lot. david: for many women in china and elsewhere, but certainly china, you are a role model. how do you fulfill that role? do you speak to a lot of women's groups? do you tell women they should do x, y, and z to advance? how do you take on that responsability? jean: first of all, i think we are all learning and growing. i would not consider myself a role model, but i would consider myself someone who loves to share my own life experience. i have also experienced ups and downs personally and professionally. i think the best way is to share your life story without really telling people what to do. people will get inspired. david: your father is a very prominent person in the chinese business world and global business world, lenovo is a company he basically built. does he give you advice? or he does not at this point? jean: one piece of advice i got that benefited me for my whole
life, he always said, life is supposed to be hard. when we had our hiccups and the incidents, a lot of times, it is frustrating, if you are helpless and hopeless, like what happened last year. but i always remember my father telling me that life is supposed to be hard. i think that makes me more resilient and stronger. david: what would you say you are most proud of having achieved as the president of didi? jean: for the company, i am most proud that we are providing 10 billion trips per year and serving all different types of need. we are creating income for tens of millions of drivers. personally, what makes me proud is we have built a team with resilience and commitment, and people view this as the right thing to do. ♪
emily: she grew up in rural indiana, the oldest of four siblings and a homecoming queen. while many of her female classmates dropped out of college to marry, she took a job at clorox, where she helped launch -- >> fresh step, the only paw-activated cat litter. emily: fresh step cat litter, and the beginning of a storied career. she went on to become the ceo of a software company best known for its hit trivia game -- >> you don't know jack! emily: and later, the first company to sell movies online. but it was the online pet store known for its popular sock puppet spokesdog that catapulted her to the center of the dot-com boom.