Republican vice presidential candidate Senator J.D. Vance — AP
DEEP inside their glass-walled corridors, some of Silicon Valley’s biggest venture capitalists (VCs) are smiling to themselves about Donald Trump’s new running mate, JD Vance.
Resentment over a public backlash against tech combined with disillusionment over President Joe Biden have contributed to an ideological shift to the right in Silicon Valley over the last few years, driven by a number of venture capitalists.
If Trump wins and if his new vice-president sticks to his beliefs on antitrust, his appointment could finally challenge the dominance of Big Tech firms.
That would be a welcome change. Less welcome, however, would be the way he is seeking to erode the progressive values that have underpinned the tech world for years.
Several leading VCs cheered the appointment of someone they consider one of their own.
“WE HAVE A FORMER TECH VC IN THE WHITE HOUSE,” Founders Fund partner Delian Asparouhov posted on X after news about Vance’s appointment broke.
“GREATEST COUNTRY ON EARTH BABY.” There was more gushing praise from Chamath Palihapitiya, David Sacks, Elon Musk and more.
When I asked an Israeli venture capitalist over lunch on Tuesday about the news, he simply pumped his fist in the air and grinned.
This comes at a time when some of Silicon Valley’s ultra-rich investors are gravitating towards Trump. Prominent VCs like Marc Andreessen and Ben Horowitz and veteran Sequoia Capital investor Doug Leone are making large donations to political action committees supporting Trump’s campaign.
Elon Musk has just pledged monthly contributions of US$45mil. Vance himself has strong financial ties to tech, and especially to Peter Thiel, who gave Vance his first VC job, put money in his first venture fund, and donated US$15mil to his 2022 Senate campaign in Ohio.
California has long been a Democratic stronghold, but the rightward move by some of tech’s leading figures mirrors Vance’s own transition from never-Trumper to Make America Great Again advocate.
While Vance’s self-declared “red-pilling” has been more ideological, the shift for tech investors has naturally been more financial.
They’ve soured on Biden over his 25% minimum tax on billionaires and fears that he’ll over-regulate AI. His perceived hostility to crypto, which Trump and Vance have embraced, hasn’t helped either.
A cultural adjustment has also taken place in tech over the last two years, culminating in a more hard-nosed management style.
The region’s reputation for generous perks and cushy middle-management jobs look passé after Musk’s sledgehammer tactics at Twitter, where he cut 80% of staff last year.
That move reportedly gave leadership at other tech firms cover to make similarly harsh cutbacks, including ones that gutted their trust and safety teams.
Tech firms like Zoom Technologies Inc, Google and Meta have meanwhile reined back diversity, equity and inclusion (DEI) programmes they put in place after the murder of George Floyd, reforms that have coincided with a startling and disturbing decline in women in tech.
For better or worse, Silicon Valley is a place where gut-feeling and fear of missing out are powerful drivers of change.
That’s why Vance’s presence in the White House, and the credibility that gives to his rhetoric against issues like immigration and abortion, could fuel a greater unravelling of Silicon Valley’s progressive values.
Technologists mostly ignored Trump’s antagonistic comments on diversity and immigration when he was president between 2016 and 2020, but Vance’s views hold special weight as a former VC.
He has not been shy about his disdain for diversity programmes, recently tweeting about industrial-scale diversity, equity, and inclusion in tech and left-wing bias in AI tools like Google’s Gemini.
Efforts to make AI safer, he said, were an “obvious effort to entrench insane left-wing businesses.”
Despite the hyperbole, there are many unknowns with Vance.
Vice-presidents have a history of being shunted to the background, and there’s every chance that Trump will do that to his 39-year-old running mate. (That hasn’t been the case with all veeps, of course: see Dick Cheney’s sway over foreign policy and national security decisions after 9/11.)Vance’s views on tech –- which he has talked about more than other former vice-presidential candidates – are also complex. He is a protege of Thiel and spent six years with three different VC firms, often focusing on Midwestern startups before founding his own Narya Ventures.
He has rightly railed against the dominance of Big Tech, which includes Alphabet Inc, Meta Inc and Microsoft Corp, and attacked AI regulations that could “be to the advantage of those current incumbents.”
He’s thrown his weight behind the Federal Trade Commission’s aggressive antitrust action against tech giants and tweeted that “it’s time to break Google up.”
That view is not as controversial as one may think in Silicon Valley, especially among venture capitalists whose startups are often locked into using the tech giants’ cloud services.
The VC relationship with Big Tech is a grudging one where they must make nice with execs who might one day buy their startups, but whose dominance of market and talent stifles the growth of their investments.
In that sense, Vance is trying to toe a line between two distinct elites in Silicon Valley.
There is Big Tech, and then there’s the vast network of startups and wealthy venture capitalists.
Cracking down on the former without also harming the latter won’t be easy if Vance is serious about levelling the playing field, but addressing Big Tech’s grotesque market imbalance is something that’s long overdue. — Bloomberg
Parmy Olson is a Bloomberg Opinion columnist covering technology. The views expressed here are the writer’s own. Yet, given how slow and cumbersome antitrust enforcement in the United States can be, Vance’s greater impact will most likely be in adding fuel to Silicon Valley’s cultural shift back to an elite tech-bro culture, as his comments about everything from immigration to abortion to diversity initiatives get amplified on social media in the coming months.
The small but hard-won gains Silicon Valley has made in bringing more women and ethnic minorities into tech are under threat more than ever. If that is Vance’s legacy for the region and industry, it will be a disappointing one. - Bloomberg
Parmy Olson is a Bloomberg Opinion columnist covering technology. The views expressed here are the writer’s own.
