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EXCLUSIVE  Published about 2 hours ago
Uber Group’s Visit to Seoul Escort Bar Sparked HR Complaint
By Amir Efrati
Mar. 24, 2017 9:05 PM PDT
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A woman who dated Uber CEO Travis Kalanick for three years, Gabi Holzwarth, says she was with Mr. Kalanick when he and a team of five Uber employees visited an escort-karaoke bar in Seoul in mid-2014. At the bar, women sat in a circle, identified by numbered tags. Four male Uber managers picked women out of the group, calling out their numbers, and sat with them, she says. About an hour later, she and Mr. Kalanick left.

A year later, a female Uber marketing manager who was in the group told Uber’s HR chief that the outing had made her uncomfortable, according to Ms. Holzwarth, who says she spoke to Mr. Kalanick about the complaint. Ms. Holzwarth also discussed the matter with the female Uber manager via instant message, which The Information has viewed.
THE TAKEAWAY
A 2014 visit by a group of Uber managers, including CEO Travis Kalanick and senior VP of business Emil Michael, to a Seoul escort-karaoke bar, prompted a complaint from an Uber employee to human resources. It highlights the male-dominated workplace culture at Uber that has been in the spotlight in recent weeks.
The marketing manager told Ms. Holzwarth in the instant message exchange that she spoke to Mr. Kalanick and the company’s human resources chief about the episode. “[I]t made me feel horrible as a girl (seeing those girls with number tags and being called out is really degrading),” the manager said in the exchange. The Information isn’t publishing the woman’s name to protect her privacy.

And three weeks ago, amid rising controversy over Uber’s male-dominated workplace culture, Ms. Holzwarth alleges that Uber’s senior VP of business Emil Michael—who was in the Uber group that visited the escort-karaoke bar—called her and said he feared the South Korea incident would be discovered by the press. He repeatedly asked her to tell anyone who asked about it that the group had visited a karaoke bar, she says.

“I just want to make sure that if this story comes out,” that she would say they went to karaoke and “had a good time,” Mr. Michael said, according to Ms. Holzwarth.

Ms. Holzwarth, who described the bar in vivid detail in an interview with The Information, said she and Mr. Kalanick left less than an hour after the men in Uber’s group picked some women to sit with. She doesn’t know what happened after she left.

Mr. Michael’s call prompted her to discuss her concerns with Uber’s top public relations executive Rachel Whetstone and Mr. Kalanick, among other people. She described and provided correspondence of those conversations for this story.

“I’m not going to lie for them,” she said in an interview with The Information this week. In the interview, she described Mr. Kalanick as “part of a class of privileged men who have been taught they can do whatever they want, and now they can.”

She said she wouldn’t have considered speaking publicly had Mr. Michael not attempted to “silence” her.

A spokeswoman for Uber said: “This all happened nearly three years ago. It was previously reported to human resources and in early March was referred to Tammy Albarran and Eric Holder,” who are leading an investigation into Uber's workplace culture.

Emil Michael said to The Information: “Given the intense news cycle I thought it was the right thing to do to reach out and let her know that reporters may try to contact her directly. I have known her for a long time, consider her a friend and did not want her to be taken by surprise. Her recollection of this conversation was different from mine and I am very sorry if the purpose of my call was misunderstood.”

High-end escort-karaoke bars are fairly common in Seoul, often frequented by businessmen, who pick out women to drink with. Karaoke is typically a feature of the evening. The men can choose to have sex with the women as well. Prostitution is illegal in South Korea.

Ms. Holzwarth’s statements are sure to deepen a controversy swirling around Uber’s male-dominated culture, a crisis prompted by sexual harassment allegations made by a former Uber engineer. Those allegations have sparked the investigation led by Mr. Holder, a former U.S. Attorney General, and have led to the departure of several top executives. The law firms handling the investigation will report the findings to Uber’s board later this spring. Uber board director Arianna Huffington promised earlier this week to make the reports’ findings public. Uber has also begun a search for a No. 2 executive to help Mr. Kalanick run the company.

The South Korea episode puts the spotlight on Mr. Michael, one of Mr. Kalanick’s closest confidants, who has already been embroiled in a controversy. In 2014, he suggested at a private dinner attended by a BuzzFeed reporter that Uber spend a million dollars digging up dirt on reporters critical of the company. Mr. Michael later apologized. Mr. Kalanick later said Mr. Michael’s comments were “terrible” and didn’t represent the company. "I believe that folks who make mistakes can learn from them—myself included. And that also goes for Emil…," Mr. Kalanick tweeted at the time.

Ms. Holzwarth said she spoke to Mr. Kalanick two weeks ago to tell him how upset she was by Mr. Michael’s call. The conversation veered onto the situation at Uber right now. She said she asked him if he might consider stepping down from the CEO role to “take care of yourself.” He told her that perhaps 2,000 employees in his company might want him to leave, but the others (10,000-plus) needed him. “You’ll know when you’re a mother,” he told her, according to Ms. Holzwarth.

Ms. Holzwarth, now 27, dated Mr. Kalanick from the end of 2013 until the summer of 2016. She has worked at tech companies such as a self-driving car startup. She also plays the violin professionally at various events, including at The Information’s launch party in 2013.

She has remained friends with several Uber executives and employees and says she wants the company to succeed. But she says she is concerned appointment of a no. 2 executive would only be a “band aid” covering the systemic workplace problems and questionable management practices at the company, some of which are detailed here.“Change starts with the truth,” says Ms. Holzwarth, whose name is pronounced “hoalz-vaht.” (Mr. Kalanick often referred to himself as a “fierce truth-seeker” inside of Uber, she said.)

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Emil Michael. Photo by Bloomberg
In the interview, she described the scene at the bar, where miniskirt-wearing women sat in plastic chairs as the men “sized them up” and decided “which numbers” they would choose and “take downstairs.” After picking women, visitors typically headed downstairs to get acquainted with the women and sing karaoke before going home with them, she said.

After the four male Uber managers picked out women, the group headed downstairs to sing karaoke. After a few minutes, the marketing manager appeared visibly unhappy and left, Ms. Holzwarth said. She and Mr. Kalanick left about 45 minutes later, leaving behind the other Uber managers with the women they had picked out.

More than a year later, Ms. Holzwarth contacted the woman on Facebook to see how she was. The two then had an exchange over Facebook Messenger, which was viewed by The Information: “I...didn’t know what was going on until [w]e got into that room...the response I got from another male coworker was, ‘Well, that’s how Korea is.’” The woman added that she was “afraid [people] would say, ‘It’s so long ago—why now?’” and that “I don’t think many men will understand why I may feel the way I feel.”

As part of that instant message exchange, Ms. Holzwarth, who was still dating Mr. Kalanick at the time, told the marketing manager that she was “actually really glad you were strong enough to bring it up. Not many women are. I wasn’t. I pretended to be ‘cool’ with things.”

She described Mr. Kalanick as “part of a class of privileged men who have been taught they can do whatever they want, and now they can.”
Also in that exchange, the woman wrote that she had spoken with Mr. Kalanick and Uber’s HR leader, Renee Atwood. (Ms. Atwood, who no longer works for Uber, could not be reached for comment.) Ms. Holzwarth said she recalls Mr. Kalanick’s phone conversation with the marketing manager, which occurred when she and Mr. Kalanick were on vacation in Italy.

“Are you OK, girl?” Mr. Kalanick asked the marketing manager by phone during their vacation, according to Ms. Holzwarth. He later said to the marketing manager on the phone that he wished she had come forward sooner. After the call, Mr. Kalanick told Ms. Holzwarth that the woman “must have a lawyer and wants something” and that’s possibly why she raised the issue, according to Ms. Holzwarth. “Sometimes it just takes time for women to talk about these things,” Ms. Holzwarth said she responded.

It isn’t clear how the HR complaint was resolved but the woman appears to still be at the company. She didn’t respond to a request for comment.

Gabi Holzwarth with Mr. Kalanick. Photo by AP
Gabi Holzwarth with Mr. Kalanick. Photo by AP.
Cascade of Controversies

In mid-February, Uber engineer Susan Fowler wrote a blog post describing her experience at Uber, the beginning of a cascade of controversies focusing on Uber’s culture. In late February, Uber’s newly hired engineering chief Amit Singhal quit when Uber discovered he hadn’t disclosed a sexual harassment allegation was made against him at his previous employer, Google.

A couple of days later, on March 1, Mr. Michael texted Ms. Holzwarth, asking to call her. She said they hadn’t spoken in eight months, since she says she split up with Mr. Kalanick.

When Mr. Michael called, he told her that “things have been really rough out here,” referring to Uber’s issues. He then said, “Remember that night in Korea?” There are reporters, he said, who will try to “break the story and I just want to go over things with you. We just went to a karaoke bar and that’s all that happened, right?”

He noted that “someone is leaking the story,” adding that he wanted to clarify with her that karaoke was all that happened, according to Ms. Holzwarth. “Can you just leave me out of it?” Ms. Holzwarth recalls asking him.

The two went back and forth, repeating those lines, she said. Then she said, “I’m dealing with my own shit” and started crying.

At the very end, Ms. Holzwarth said “yes, OK” to Mr. Michael’s request. “I hope everything’s OK, take care of yourself,” she said. Both of them then said goodbye.

Two days later, after Ms. Holzwarth said she was stricken with anxiety because of the phone call and had a relapse of an eating disorder, she called Rachel Whetstone, Uber’s head of public policy and PR. She told her about the phone call with Mr. Michael and said Uber should leave her alone.

Ms. Whetstone told her she would take notes about the South Korea incident, the call with Mr. Michael, and said “I’m so sorry,” according to Ms. Holzwarth. Ms. Whetstone asked Ms. Holzwarth numerous questions, including whether anyone used a corporate credit card at the escort bar. (Ms. Holzwarth didn’t know.)

After the call, Ms. Whetstone called Uber’s general counsel, which referred the matter to Mr. Holder’s team, according to a person with direct knowledge of the matter.

The next day, Mr. Michael sent Ms. Holzwarth several text messages, which were viewed by The Information. “I am so sorry for being cold the other day on the phone,” he wrote. “I was super panicked. I should have asked about you and how you were doing. I care about you and consider you a friend. We shared some amazing times together. I hope you believe me. I would love to see you at some point too.”

Later that day, Mr. Michael’s girlfriend and another female Uber employee texted Ms. Holzwarth to check in with her. Another of Mr. Michael’s female friends, with whom Ms. Holzwarth was acquainted, then invited her to a birthday party.

That night, Ms. Holzwarth sent a text message to Mr. Kalanick, saying she was resolved not to attack him and Uber publicly but wanted “Emil [Michael] and everybody at your company (to) let me be at peace as I put that part of my life behind me as best I can.”

In messages viewed by The Information, Mr. Kalanick responded that he “will respect your wishes for peace but I am always here” and “available to talk on the phone.”

She told him he didn’t “have to pretend to be nice to me.” She said she wouldn’t talk to reporters and had “said no comment to all of them.”

When she explained in more specifics about the call with Mr. Michael, Mr. Kalanick said, “No idea what this conversation was.. will ask emil.” She then asked him if he had spoken to Ms. Whetstone, the PR chief. “About what?” he responded.

The two then spoke on the phone briefly, with Mr. Kalanick reiterating that he had no knowledge of Mr. Michael’s call. A day later, Mr. Kalanick sent an instant message to Ms. Holzwarth, asking how she was doing.

After Ms. Holzwarth said, “I can’t speak to you anymore,” Mr. Kalanick said he didn’t understand why and that he was “going through a tough time and it’s really nice to talk to someone.”

CORRECTION: Susan Fowler's post about her experiences at Uber appeared on her blog. An earlier version of this article incorrectly said it appeared on Medium.