Sources: Benchmark, other Uber shareholders have discussed selling some shares to SoftBank; Benchmark initiated the effort to sell stock before the CEO's ouster
Uber Technologies Inc. shareholders and its board, led by early backer Benchmark, have discussed selling some of their shares …
Context & Ripple Effects
This July report opened the arc that defined Uber's second half of 2017: Benchmark — Uber's earliest backer and a board power center — had quietly started shopping shares to SoftBank even before the CEO's ouster, tying the investor-exit question directly to the governance crisis. By August the shape of a deal had emerged in reporting on SoftBank's structure of buying existing shares at a steep discount while injecting new money near the last valuation (buying shareholder stock at $40B-$45B plus $1B at $70B).
The story then bent twice more: by September Benchmark told fellow investors it was leaning against selling into the consortium (unlikely to sell any shares), yet by November it and Menlo Ventures were committed sellers in a tender at a $48B valuation — well below Uber's prior mark — with other holders given twenty days to sell or wait for a possible 2019 IPO (the SoftBank tender). The through-line is that Uber's internal turmoil created the first real liquidity window for its late-stage backers.
First-order effects
- SoftBank gains a negotiated path to a large Uber stake at a discount to the last private valuation, while early holders like Benchmark and Menlo convert paper gains into cash years ahead of any IPO.
- Benchmark's disclosure that it began the sale effort before the CEO's ouster puts its dual role — board governor and motivated seller — under direct scrutiny from other shareholders.
Second-order effects
- Competing suitors — a Dragoneer-led coalition and a Pishevar offer, both reported as under board consideration — force price discovery, pushing the eventual clearing price toward the discounted end of the range rather than the headline valuation.
- A tender priced below Uber's prior round hands every later investor a marked-down reference point, pressuring how Uber can defend its valuation heading into fundraising or an IPO.
Third-order effects
- If the pattern holds, structured secondaries to deep-pocketed consolidators like SoftBank become the standard exit for late-stage venture positions, replacing the binary wait-for-IPO bet.
- Boards dominated by funds actively negotiating their own exits face a structural conflict-of-interest problem that governance norms and possibly regulation will have to catch up with.
The trend: Late-stage startup equity is shifting from hold-until-IPO to negotiated secondary sales to sovereign-scale buyers, with governance disputes accelerating rather than delaying the repricing.