Democracy Gone Astray

Democracy, being a human construct, needs to be thought of as directionality rather than an object. As such, to understand it requires not so much a description of existing structures and/or other related phenomena but a declaration of intentionality.
This blog aims at creating labeled lists of published infringements of such intentionality, of points in time where democracy strays from its intended directionality. In addition to outright infringements, this blog also collects important contemporary information and/or discussions that impact our socio-political landscape.

All the posts here were published in the electronic media – main-stream as well as fringe, and maintain links to the original texts.

[NOTE: Due to changes I haven't caught on time in the blogging software, all of the 'Original Article' links were nullified between September 11, 2012 and December 11, 2012. My apologies.]

Monday, May 30, 2016

Meet the Montrealer who gave Uber a jolt

MONTREAL—Alexandre Taillefer’s father taught him to read a newspaper upside down at the age of 5. It seemed no more than a game at the time, certainly less practical than the lessons that soon followed in how to play the stock market. But it taught him to look at things differently, an ability that helped make him a rich man.

As with so many of Quebec’s public figures, Taillefer’s high profile is largely restricted to the province. But that could soon change. He’s the Quebec poster boy for the battle against Uber, a crusade he plans to bring to Toronto next year.

A grey-bearded 43-year-old with black-rimmed glasses, the self-described “deal junkie” has been a bit of a boy wonder in the Quebec business world since 1993, when, at the age of 21, he founded a website design firm that would take his personal wealth to almost $100 million.

He surfed the highs and lows of the dot-com bubble and emerged as managing partner of his latest creation, a private equity investment company called XPND Capital. Recently, he was shaken by the death of his young son, a personal tragedy that tempered his well-known joie de vivre and fuelled a desire for a meaningful legacy.

“My objective is not to become a billionaire,” he says in an interview at his Ste-Catherine St. office in downtown Montreal. “My objective is to work on projects that will improve society, that will make people happier. That’s my big motto.”

The head of Montreal’s board of trade, Michel Leblanc, calls Taillefer the bearer of a “third way” business philosophy between scorched-earth “disruption” and ossified status quo. The best example, Leblanc says, is Taillefer’s fledgling taxi company, called Téo.

It’s a bizarro-world reflection of both Uber and the traditional taxi industry. Its name a French acronym for “optimized ecological transportation,” Téo’s only similarity to Uber is the app-based hailing and payment service.

The differences begin with Téo’s fleet, which are all electric cars owned by the company. App software glitches since the launch last November often kept its initial 60 cars off the road until fixes were completed in early April. Taillefer plans to have 1,000 cars by 2018, a total investment of $250 million.

The more radical difference is Téo’s model of drivers as company employees. They earn $15 an hour ($4.25 more than Quebec’s minimum wage), work eight-hour shifts, receive benefits including two weeks of vacation and company contributions to Quebec’s pension plan, and are eligible for workers’ compensation in case of injury.

In an industry where drivers often work 12-hour shifts to make ends meet, Téo’s notion of disruption is in stark contrast to that of Uber, which emphasizes the self-employed model.

“We decided to reinvent the taxi industry,” says Taillefer, who put $3.5 million of his own money into Téo, along with funds from XPND Capital. Other investors include the powerful Caisse de dépôt et placement, which manages Quebec’s pension plan.

Taillefer plans to expand Téo to Quebec City. And during an interview with the Star, he announces: “I’m dead serious about Toronto. Our intention is to be in Toronto in 2017.”

Chilly reception for Uber

Quebec’s Liberal government likes what Taillefer is selling. It made Téo possible by amending regulations — allowing the company to rent taxi permits — and gave $5 million to launch it as a pilot project. The government also backs his characterization of American-based Uber as an outlaw service populated with drivers ducking taxes.

Another boost came on May 12, when the government tabled legislation forcing Uber to adhere to the same regulations governing all Quebec taxi companies. Its drivers will need to buy or rent taxi permits and obtain a taxi driver’s licence, which involves 53 hours of mandatory training. The government will also control the number of permits, and drivers will have to pay provincial sales tax on every ride.

Breaking the proposed rules will result in stiff fines, cars seized and drivers’ licences suspended. The only concession to Uber’s model is the introduction of industry-wide surge pricing.

In a statement Monday, Uber Canada said the draft legislation “would prevent sharing economy services like Uber from operating in Quebec.” Its Quebec general manager, Jean-Nicolas Guillemette, made clear that the company’s hardline attitude with the government had failed.

Guillemette had refused to suspend Uber’s Quebec operations during legislative hearings on the bill, a move that added to government anger about unpaid taxes.

“We regret where the debate on regulations has led us and we take responsibility for our part in getting there,” Guillemette wrote. He announced Uber would take part in government consultations on the bill, hoping to find “a middle ground.”

As a homegrown company, Téo has wide business and public support, Leblanc says. But he criticizes the proposed law as failing to fully reform an outdated industry and likely to drive Uber out of Quebec.

“What’s troublesome is that it sends a signal that innovative models are difficult to establish here,” Leblanc says.

The government also faces a backlash from the Liberal party rank and file, who clearly want Uber to stay. A week ago, the party’s general council adopted a resolution from the Liberal youth wing calling on the government to embrace the sharing economy.

Taillefer credits Uber with improving a stagnant industry. He’s not surprised millennials embraced it as a ride-sharing service, and hopes to lure them by marketing the social and ecological aspects of Téo.

“Gen Y is a bit mixed up,” he says. “They think that limiting Uber is attacking innovation. It’s not.

“I would never start a business the way Uber has, which is to attack regulations in every city and really mock democracy,” he adds. “It’s savage capitalism.”

He cites a survey his company conducted of Montreal Uber drivers, which concluded they make about $6 an hour after expenses, including fees for the app-based dispatch service.

“Innovation is important but it can’t come at the price of a reduction in social equity,” Taillefer says. “What the Uber model is essentially pushing is more self-employment, which in our society has become a way of paying people less than the minimum wage. And that to me is unacceptable.”

Dragon with a difference

Taillefer’s public persona in Quebec was launched in 2013, his first of three seasons as a venture capitalist on the French-language version of Dragon’s Den. But don’t dare ask — as the Star did — if he’s the francophone equivalent of that other guy.

“If you want to show me disrespect, compare me to Kevin O’Leary,” he says, almost spitting his contempt for O’Leary’s “greed is good,” power-to-the-market ethic. “Neo-liberalism is probably the worst thing that can happen to society.”

He says he opposes self-defeating forms of capitalism that drive down wages, leave workers without a social safety net and create a growing class of people too poor to buy products and services.

“He’s an entrepreneur with a social conscience,” says Leblanc, the board of trade president and CEO, adding that Taillefer has been calling for a $15-an-hour minimum wage in Quebec, a move the board opposes.

“He represents someone who innovates not just at the level of technology but at the level of business models,” Leblanc says, describing Taillefer as a force in multiple cultural and business networks.

Taillefer’s headquarters is a fifth-storey loft decorated with modern art from his private collection, one of the most important in Canada.

Jean-Robert Drouillard’s sculpture of a proud man, standing cross-armed with moose antlers sticking out of his head — called I Am Nature — dominates an open space where dozens of employees tap away quietly at computers. Nearby, attached high to a cement support beam, is a chair partly covered by a lampshade and pierced by a neon light.

“As long as an artist determines that it’s art, you can’t say that it’s not,” Taillefer says, looking at the chair. “You can just decide whether you like it or not.”

He and his wife, fashion industry executive Debbie Zakaib, own more than 300 works. A Taillefer favourite, framed in his office, is a photograph of a man standing with his face buried in the naked belly of a child he holds high. Neither face can be seen, a fact that allows unsettling interpretations. But Taillefer, whose 14-year-old son died in December, sees only the profound love of a father for his child.

“I like to be surrounded by art that moves you, that shocks you, that puts you on the edge,” he says, adding that the best entrepreneurs have the imagination and creativity of artists.

“Art helps you create better strategies, helps you see things differently. It helps you get through life because life can be miserable.”

A decade ago, Taillefer became head of Montreal’s opera company and saved it from bankruptcy. He now heads the city’s contemporary art museum — appointed by a Quebec government that hopes he can work the same magic there.

He also sits on a committee with federal and provincial ministers, mapping Montreal’s cultural investments for the next decade, and on a board planning the city’s 375th anniversary celebrations next year.

He grew up in Montreal surrounded by the works of Old Masters — fakes produced by his mother, a hobby painter. His father sold insurance for Quebec film productions.

In his late teens, Taillefer tried to become a standup comedian, but flopped. He then participated in a reality TV show in which contestants produced short films. But he lost, and had no idea what to do next.

While at Jean-de-Brébeuf College, Prime Minister Justin Trudeau’s alma mater, he slipped on a beer-soaked dance floor and sued the school. At 20, he headed to Europe with his $12,000 settlement.

In France, he was travelling with friends to the Côte d’Azur when their car was hit by two other cars that collided head on. Four people died; Taillefer and his friends survived. He doesn’t know if charges were laid, but believes one of the drivers may have been drunk.

“I saw a guy decapitated,” he says. “When you live through something like that, it puts things in perspective.”

He returned to Montreal, enrolled in a university computer program and discovered a new talent. He left without getting his degree and in 1993 launched Intellia, a website design company bought three years later by communications giant Quebecor. He stayed on as a top manager, making acquisitions that turned Intellia into today’s Nurun, a designer of digital products and platforms.

Taillefer’s Nurun shares, at $89 each, made him worth almost $100 million at one point. “I was 28 at the time. I bought a Porsche, bought a house and got a wife,” he says, adding he had already been living with Zakaib for a year. They would eventually have two children, a boy and a girl.

In 2000, the dot-com bubble burst. Taillefer sold his stock at less than a dollar a share and found himself $2.5 million in debt. The bank called him to the “special loans” division.

“They put you in a very small room, kick up the heat and leave you there on your own for a few minutes. Then they come in and say, ‘We want all your goods.’”

Two years earlier, Taillefer had transferred ownership of his home to his wife. There was little for the bank to seize. “That’s when your problem becomes the bank’s problem,” Taillefer says, smiling.

He had just started a new company, Hexacto, which designed games for mobile phones, long before they got smart. Investors were hard to come by. “Wireless gaming? People thought I was crazy,” he says.

To the relief of his bankers, he sold the company in 2003 for $10 million. It sold again three years later for $680 million. Taillefer still owned shares.

In 2007, he co-founded Stingray Digital Group, the cable TV music provider with more than 100 million subscribers around the world. He sold his stake before it raised $140 million in its initial public offering and, in 2010, set up XPND Capital, which manages investment funds of $100 million.

XPND invests in several companies, from a maker of fuel-efficient school buses to one that bought and relaunched a once-influential free cultural tabloid, to another building an observation deck atop the city’s iconic Place Ville Marie.

Investing suits Taillefer’s temperament. He gets bored easily, yet has learned that a company’s success can’t be rushed.

“Creating the right broth requires slow cooking,” he says. “You can’t put the heat to the max and think it’ll come out right. You need to put it on simmer.

“An investment fund lets me have many pots simmering at the same time,” he adds. “If one needs more spice, I spend time dealing with it, and then go to the next one.”

Taillefer has mused about one day entering politics. Asked if he’s a Quebec nationalist, he replies: “I’m a Montrealist.” He laments “all the money that flew away during the (sovereignty) referendums,” landing in Toronto along with many of Montreal’s young bright minds. He hopes they’ll be lured back by a city that one day overcomes its economic struggles and becomes a symbol of innovation, design and “authenticity.”

He won’t say how much he’s worth, stressing that business teaches humility; luck plays a big role in success and all can be easily lost. Life is the same, of course, although some losses can make explanations sound meaningless.

Heartbreak on a Post-it note

The day before Taillefer met the Star, in mid-April, he appeared on Radio-Canada’s top-rated talk show, Tout le monde en parle. Confident and intense while explaining his business ventures, he broke down when asked about the death of his son, Thomas, on Dec. 6.

He told Quebecers for the first time that Thomas had taken his own life in his home. The only message the 14-year-old left was a Post-it note stuck to his computer. It said simply, “Bye.”

“I was a good father. I loved my son,” Taillefer says the day after his TV appearance. “I would cook dinner every night and I would wake him up every morning and spend two or three hours with him.”

In the months before his death, Thomas was diagnosed as gifted, perhaps mildly autistic and a bit stressed. He was given pills for a more restful sleep.

“We met psychiatrists and they never detected he was suicidal,” says Taillefer, who wants to see more publicly funded programs for people struggling with mental illness.

Thomas spent long hours on Twitch, a wildly popular live-streaming video platform where gamers gather to play, watch and socialize. It was bought by Amazon in 2014 for almost $1 billion (U.S.).

Thomas didn’t share his troubled thoughts with his parents. But after his death, Taillefer learned that his son had sent “clear signals with the word suicide” in a post on the site last May. Two other messages that should have raised alarm were posted in June and on the December day when Thomas killed himself.

Taillefer wants to know why Amazon, which can detect if online shoppers are in the market for a pair of red shoes, doesn’t alert parents or authorities when someone posts about suicide on a site it owns.

This week, he and his wife sent a letter to the chairs and CEOs of Twitch and Amazon. It detailed what happened to Thomas and called on the companies to develop software to detect suicidal behaviour.

Taillefer, who calls his son’s death “my biggest failure,” takes some comfort in knowing the tragedy has brought his family closer. They’re spending more time together; social engagements have lost their appeal.

“Life is hard to understand,” he says. “You need to work on a purpose. Doing good around you, trying to change things — not only for your wallet, but for the good of society — is what keeps me alive.”

The Téo model


  •     Up to 3,000 drivers will eventually be hired by Téo, some of them part-time. There are more than 10,300 drivers in the traditional taxi industry in Montreal, using 4,400 permits, a number regulated by the provincial government. During the Grand Prix week last June in Montreal, 1,000 UberX drivers were on the road.
  •     Ryad Azzouni, 31, drove a traditional cab for four years before switching to Téo. He went from 12-hour shifts, often seven days a week, to working 40 hours over five days. “My life has completely changed,” he says. “I have more time for my family, my friends and for myself.”
  •     Téo is aiming for standardized service, from the all-black outfits for drivers to the cleanliness of cars. “The big challenge is for drivers to go from being an independent worker to a salaried one,” says Téo’s director of operations, Thierry St-Cyr. “They like the fewer hours and bigger salaries, but they have to learn that now there are rules. You have to arrive at a certain hour every morning and you can’t leave when you like.”
  •     Téo currently uses Nissan Leafs, Kia Souls and Teslas. Other electric cars will be tested. Next spring, the model that performs best during winter will be chosen to populate what will eventually be a 1,000-car fleet. Depending on the price of gas, Taillefer expects his electric fleet to provide cost savings of up to 15 per cent.
  •     Téo plans to invest $20 million for its own charging stations, including some that can recharge a car in 35 minutes. Some already exist at the company’s garage in southwest Montreal; more will be set up at another garage downtown. Two mobile stations will be located in parts of the city where demand is high.
  •     On the roof of the cabs are 4K resolution screens. “We’ll have one of the largest out-of-home advertising networks in the world,” Taillefer says. Passengers will have the use of a tablet with a feature that recharges smartphones. Passengers who hail a Téo on the street can also use it to set up an account for payment; Téo is a cash-free ride.


Original Article
Source: thestar.com/
Author:  Sandro Contenta

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