• Home
  • Latest
  • Fortune 500
  • Finance
  • Tech
  • Leadership
  • Lifestyle
  • Rankings
  • Multimedia

Trendingnow

1

MacKenzie Scott alone accounted for one-third of America's $19.2 billion in megagifts last year

2

Now worth $200 million, Sarah Jessica Parker credits being ‘one of eight kids that struggled financially’ for her hunger, ambition, and work ethic

3

Ray Dalio says the U.S. just had its 'Suez moment'—and history says what comes next could end an empire

1

MacKenzie Scott alone accounted for one-third of America's $19.2 billion in megagifts last year

2

Now worth $200 million, Sarah Jessica Parker credits being ‘one of eight kids that struggled financially’ for her hunger, ambition, and work ethic

3

Ray Dalio says the U.S. just had its 'Suez moment'—and history says what comes next could end an empire
TechUber Technologies

Alphabet’s Lawsuit Against Uber Cements End of Uneasy Marriage

By
Reuters
Reuters
Down Arrow Button Icon
By
Reuters
Reuters
Down Arrow Button Icon
March 6, 2017, 8:31 AM ET
Add Fortune on Google for similar content.

When Uber Technologies was raising venture capital in 2013, it was one of the hottest deals around—and no one was more eager to write a check than Bill Maris and David Krane of Google’s venture capital arm.

Not everyone at Google Ventures, since renamed GV, agreed. The firm already had an investment in a competitor, Sidecar, and Uber was demanding what then looked like a sky-high valuation.

Maris and Krane prevailed, and the deal is now regarded as GV’s greatest success. On paper, the firm’s initial 2013 investment of $258 million gained about 14 times its value over the next three years to more than $3.5 billion.

But now Alphabet (GOOG), Google’s corporate parent, is suing Uber for theft of trade secrets, alleging that one of the top engineers in its self-driving car program decamped with thousands of confidential files, including designs that helped him start self-driving truck company Otto and then quickly sell it to Uber. Uber denies those claims.

The lawsuit, filed by Alphabet’s self-driving car unit Waymo, has jolted the fast-growing and highly competitive industry that has sprung up around autonomous vehicles and ride services, which are seen as the future of private road transport.

Yet the confrontation was a long time in the making: the complex relationship between the companies was tense from the start, according to people familiar with the situation, and soured further as they increasingly competed with each other.

Now, if the Waymo suit damages Uber, GV’s investment in the ride-hailing company stands to go down as a Silicon Valley rarity: a large funding deal undermined by the firm’s own investors.

“Whatever Waymo gains, Google Ventures loses,” said Stephen Diamond, associate professor of law at Santa Clara University.

The lawsuit is just one in a series of recent public setbacks for Uber, including allegations of sexual harassment that prompted an internal investigation, a video of Chief Executive Travis Kalanick arguing with an Uber driver that led him to make a public apology, and Uber’s admission on Friday that it used a secret tracking tool to avoid authorities.

“We have reviewed Waymo’s claims and determined them to be a baseless attempt to slow down a competitor and we look forward to vigorously defending against them in court,” Uber said in a statement in response to the lawsuit. “In the meantime, we will continue our hard work to bring self-driving benefits to the world.”

A spokeswoman for GV declined to comment.

DEAL AT ANY COST

Uber was more than just another investment for then-fledgling Google Ventures, which needed a high-profile deal to put it on the map.

Maris and Krane were early Uber fans, but it took about two years for the pair to connect with Kalanick. When Uber investor Benchmark finally brokered a meeting in May 2013, the Google Ventures partners were determined to do a deal at virtually any cost, according to two sources close to the transaction.

With other would-be investors waiting in adjacent conference rooms at Uber’s San Francisco offices, Maris and Krane made their pitch to invest. Kalanick pushed for a higher valuation, without a board seat; Google Ventures pushed back, asking for a board observer seat and a liquidation preference for protection if Uber was sold at a loss, one of the sources said.

They finally came to terms, with a $3.5 billion valuation, and there were signs that a broader alliance could be in the offing. Separately, David Drummond, Google’s senior vice president of corporate development, had a social relationship with Kalanick, and he joined the board.

A ride in a self-driving car and a meeting with Google CEO Larry Page, recounted in Brad Stone’s recent book The Upstarts, seemed to bode well for the relationship.

But conflicts emerged immediately. Kalanick, a tough negotiator, wanted a discount on the software tools behind Google Maps, the company’s ubiquitous mapping software, according to a person close to the transaction. The best Google Ventures could offer was close contact between Uber and Google’s mapping team, the person said.

Kalanick also wanted Uber to be featured prominently in Google Maps, eventually giving customers a way to hail an Uber ride directly from Maps, and Google agreed, a source close to Uber said. But Uber felt Google dragged its heels on the integration and found the initial rollout disappointing, the source said.

Get Data Sheet, Fortune’s technology newsletter.

The friction only grew as Uber turned its attention to autonomous driving, an area where Google had already established an early lead. Uber announced its intentions in typically abrupt style in early 2015, poaching 40 faculty and researchers from Carnegie Mellon University to set up a self-driving lab in Pennsylvania.

It bought mapping software firm deCarta and began investing heavily in its own mapping systems. Meanwhile, Google launched an on-demand delivery service, a market Uber is also chasing, and began offering a carpooling service through driving app Waze, which it acquired in 2013. The carpooling feature in particular rankled Uber, a source close to the company said.

“Things escalated from frenemy to now enemy quite quickly,” said Anand Sanwal, CEO and co-founder of venture capital research firm CB Insights.

The tension bubbled to the surface last August, when Drummond stepped down from Uber’s board.

Uber declined comment on any of its dealings with Google and did not make Kalanick available for an interview.

UNDERMINED BY ITS OWN INVESTORS?

Uber’s aggressive culture was the subject of many conversations at Google Ventures, a source close to the transaction said. Hoping to influence the startup, the venture firm at first encouraged a flow of talent from Google to Uber.

Yet that too ultimately created problems. Anthony Levandowski, a key engineering manager at the self-driving car unit, now called Waymo, began to talk openly about leaving the company as the autonomous vehicle field blossomed, according to Alphabet’s lawsuit.

In January 2016, Levandowski and some colleagues quit Alphabet to form the self-driving truck start-up Otto, which Uber acquired later that year for $680 million. Alphabet claims in its lawsuit that Levandowski had been in touch with Uber even before he left Alphabet.

In the lawsuit, Alphabet alleges Levandowski downloaded 14,000 proprietary design documents and used them to create Otto’s—and later Uber’s—version of a key autonomous vehicle technology called Lidar, which uses light pulses reflected off objects to gauge their position.

Uber and Levandowski deny the allegations.

The high-stakes legal showdown over whether vital information was transferred between the two companies is perhaps the logical conclusion of their opaque relationship.

All along, Uber remained mysterious to its Google Ventures investors. Kalanick was adamant from the start that he would share little information, and try as it might, Google Ventures could not gain better visibility over time, two sources said. If anything, Kalanick grew more tight-lipped as his business matured.

“It was one of the few companies where we sat there and said, ‘Hope it goes well,'” one of the sources said.

About the Author
By Reuters
See full bioRight Arrow Button Icon
Add Fortune on Google for similar content.

Latest in Tech

Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025

Most Popular

Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Fortune Secondary Logo
Rankings
  • 100 Best Companies
  • Fortune 500
  • Global 500
  • Fortune 500 Europe
  • Most Powerful Women
  • World's Most Admired Companies
  • See All Rankings
  • Lists Calendar
Sections
  • Finance
  • Fortune Crypto
  • Features
  • Leadership
  • Health
  • Commentary
  • Success
  • Retail
  • Mpw
  • Tech
  • Lifestyle
  • CEO Initiative
  • Asia
  • Politics
  • Conferences
  • Europe
  • Newsletters
  • Personal Finance
  • Environment
  • Magazine
  • Education
Customer Support
  • Frequently Asked Questions
  • Customer Service Portal
  • Privacy Policy
  • Terms Of Use
  • Single Issues For Purchase
  • International Print
Commercial Services
  • Advertising
  • Fortune Brand Studio
  • Fortune Analytics
  • Fortune Conferences
  • Business Development
  • Group Subscriptions
About Us
  • About Us
  • Press Center
  • Work At Fortune
  • Terms And Conditions
  • Site Map
  • About Us
  • Press Center
  • Work At Fortune
  • Terms And Conditions
  • Site Map
  • Facebook icon
  • Twitter icon
  • LinkedIn icon
  • Instagram icon
  • Pinterest icon

Latest in Tech

Sam Altman and Donald Trump.
AIOpenAI
OpenAI agrees to stagger rollout of its most powerful model to only Trump-approved customers
By Eva Roytburg and Beatrice NolanJune 26, 2026
3 hours ago
gr
PoliticsElections
Anthropic and OpenAI waged a $27 million proxy war in a Manhattan congressional race. The winner told them both to get lost
By Sasha RogelbergJune 26, 2026
3 hours ago
fire
Europeclimate change
Greece tackles climate change wildfire risk with satellite network that can spot a blaze the size of a parking space
By Derek Gatopoulos and The Associated PressJune 26, 2026
5 hours ago
AI boom may be on its last legs amid stock volatility and dash for cash—but will go out in a blaze of glory with ‘blow-off phase’ before bubble pops
AItech stocks
AI boom may be on its last legs amid stock volatility and dash for cash—but will go out in a blaze of glory with ‘blow-off phase’ before bubble pops
By Jason MaJune 26, 2026
6 hours ago
m
LawMeta
‘Careless People’ author claims Meta surveilled her for a year to enforce her silence
By Barbara Ortutay and The Associated PressJune 26, 2026
6 hours ago
apple
Big TechApple
Apple blames inflationary effect of AI for price hikes: ‘We have never seen a component price increase this much’
By Barbara Ortutay and The Associated PressJune 26, 2026
6 hours ago

Most Popular

MacKenzie Scott alone accounted for one-third of America's $19.2 billion in megagifts last year
Success
MacKenzie Scott alone accounted for one-third of America's $19.2 billion in megagifts last year
By Sydney LakeJune 25, 2026
2 days ago
Now worth $200 million, Sarah Jessica Parker credits being ‘one of eight kids that struggled financially’ for her hunger, ambition, and work ethic
Success
Now worth $200 million, Sarah Jessica Parker credits being ‘one of eight kids that struggled financially’ for her hunger, ambition, and work ethic
By Orianna Rosa RoyleJune 24, 2026
3 days ago
Ray Dalio says the U.S. just had its 'Suez moment'—and history says what comes next could end an empire
Economy
Ray Dalio says the U.S. just had its 'Suez moment'—and history says what comes next could end an empire
By Nick LichtenbergJune 26, 2026
15 hours ago
The bond market knows something about the $39 trillion national debt that Washington doesn’t
Economy
The bond market knows something about the $39 trillion national debt that Washington doesn’t
By Eva RoytburgJune 25, 2026
1 day ago
Trump turns on Big Oil donors who spent nearly $100 million to get him elected—now he wants the DOJ to investigate them for price gouging
Economy
Trump turns on Big Oil donors who spent nearly $100 million to get him elected—now he wants the DOJ to investigate them for price gouging
By Tristan BoveJune 25, 2026
1 day ago
Current price of oil as of June 25, 2026
Personal Finance
Current price of oil as of June 25, 2026
By Joseph HostetlerJune 25, 2026
1 day ago

© 2026 Fortune Media IP Limited. All Rights Reserved. Use of this site constitutes acceptance of our Terms of Use and Privacy Policy | CA Notice at Collection and Privacy Notice | Do Not Sell/Share My Personal Information
FORTUNE is a trademark of Fortune Media IP Limited, registered in the U.S. and other countries. FORTUNE may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.