Have you ever wondered how venture capitalists in Silicon Valley decide what startups to fund and what ones to skip? I had the opportunity to sit down with one of these “masters of the universe” and explore the secrets of venture capital. Scott Kupor is managing partner at Andreessen Horowitz (AH) – one of the most successful VC firms in the world – and we had a candid and lively discussion about the do’s and don’ts of pitching; lessons from Elon Musk’s entrepreneurial journey; diversity, bias and ethics; future trends; and when it’s OK to move fast and break things. Scott teaches at Stanford and Berkeley and has a new book out – Secrets of Sand Hill Road – that aims to demystify the VC mindset. The conversation took place in front of a live audience at the Commonwealth Club in Silicon Valley on June 10, 2019.
Listen to the Fresh Dialogues podcast:
Here are some highlights of our conversation (edited for length and clarity):
Re. Women in business, diversity and bias
Alison van Diggelen: Let’s talk about diversity: Julian Guthrie’s new book is just out – called Alpha Girls – it’s about four women who took on the Venture Capital “bad boys” and succeeded, despite the odds. There are some good lessons in there. It’s a very tough place to thrive as a woman. Less than 10% of decision makers in the venture capital world are women.
Scott Kupor: The number is about 10 or 12 %, depending how you cut the numbers, and about 2% of the funding going to female founders. It’s a real problem.
There are two types of bias: explicit bias, which clearly the #MeToo Movement exposed in a very horrible way. We have to root that stuff out. We need to shine the light on what was underground for many years. The more challenging problem is implicit bias…Whether I like it or not, I’m implicitly biased by the networks I came from. When I want to hire for a job, it’s more likely I go to people I know from Stanford. What we have to do is reach out to (other) networks. So we proactively send out job recs to MLT a group that works with African Americans who’re trying to get into business and financials; and we also have a Cultural Leadership Fund (at AH).
It’s a network connectivity problem. It’s going to take time, it’s a deep rooted problem.
Alison van Diggelen: How many general partners at Andreessen Horowitz are women?
Scott Kupor: 20%. Three out of fifteen are women. That’s only in the last two years. For the first eight years we did not have any female partners…We changed our criteria and opened up the funnel to have a more diverse talent pool.
Re: Ethics and moving fast and breaking things
Alison van Diggelen: Let’s talk about ethics: lessons learned from Theranos (the blood testing company that imploded). And Facebook: they used to have a mantra: Move fast and break things. They have been cavalier about sharing our personal data. How do you train your entrepreneurs to have ethics front and center?
Scott Kupor: I think there’s a difference between outright fraud – we can’t have behavior like that in this industry – and there is this idea that sometimes you have to push faster than sometimes is comfortable and you do break things sometimes and ask for forgiveness second. I think there are elements of that that are fine in this business. There’s a difference between committing crimes and defrauding people and are you just trying to move the ball quickly? You recognize there’s going to be iteration of products and sometimes you’re going to put stuff out that may not be perfect.
The big difference is: as companies mature it’s a bit of the Elon Musk question (we talked about earlier) – I think different standards of behavior are appropriate depending upon the size and maturity of these companies. Running fast and breaking things – and putting out half baked products – is not as unacceptable in the pure startup world where the scope of the harm potentially is smaller because you’re still dealing with small amounts of customers, but when you get to the scale of a Facebook, you have a different responsibility. Our best bet on our companies is to use our persuasive techniques to make them value these things. Over time, your level of responsibility changes, based upon your success. At some point in time you have to act like the navy – not a pirate – once you conquer the ship.
Alison van Diggelen: Are you saying it’s OK to be a pirate in the early stages of a startup?
Scott Kupor: It depends on what pirate means (audience laughter).
Fraud and misleading people is clearly not right. But the idea that you might enter into a market where you’re not exactly sure what the product should look like, you might have a theory on what your regulatory structure is, but you’re not 100% sure.
I’ll give you a great example: we’re investors in Airbnb and Lyft. These companies probably couldn’t have been successful if they’d asked for permission every time they went into a new market. You could argue that was unethical: They should’ve got permission first. The reality is, they said: we’re going to go into a new market, we believe we have a defensible theory that why what we’re doing is appropriate from a regulatory perspective, but we also know we’re likely to get challenged on that. But over time, if a consumer utility is big enough, there is a way to deal with these issues. So that’s my definition of a pirate: I think that’s reasonable acceptable behavior. Fraud and misleading people is not acceptable behavior.
Why did Virgin’s Richard Branson decide to invest in Hyperloop One, the futuristic transport system that seeks to shrink journey times (like LA to San Francisco, London to Glasgow) to less than one hour? On assignment for the BBC World Service, Alison van Diggelen sat down with Branson in San Francisco to explore his vision for the Hyperloop, as well as Virgin Galactic, One Web and supersonic travel around the world.
Branson is still reeling from the deadly hurricanes that destroyed his island paradise, and he’s calling for a Marshall Plan to aid sustainable recovery in the Caribbean region. He told me he’s energized by the “climate skeptic in the White House.”
“When you’ve got 99% of scientists saying the world is heating up, the world is heating up. Yes, you’ve got a climate skeptic in the White House but most sane people – most rational people – know that we have a problem. It’s sad to have someone like that in such a position of power and therefore all of us have just to work that much harder to rectify any damage that he does.” Richard Branson, Founder of Virgin Group
Photo: Richard Branson in conversation with Alison van Diggelen for the BBC World Service. San Francisco, October, 2017. Credit: Lewis van Diggelen
Here’s a transcript of the segment (plus some bonus material), edited for length and clarity:
The BBC’s Gareth Mitchell: First, a futuristic plan to transport us in supersonic tube trains. This is a concept called the Hyperloop and now one of the world’s richest people is investing in it. Virgin Group founder, Richard Branson has just done a deal with one of the companies developing the technology, Hyperloop One. Alison van Diggelen, our reporter in Silicon Valley has been speaking to Richard Branson. The conversation begins with Branson’s other great interest: space. Not just Virgin Galactic, but plans to improve connectivity for citizens back here on earth.
Alison van Diggelen:What makes Virgin Galactic distinct from what Jeff Bezos is doing with Blue Origin and Elon Musk with SpaceX?
Richard Branson: With Virgin Galactic our principal reason for being is to help this beautiful earth that we live on. Space can help people back here on earth…One of the things we’re going to be doing through a company we’re involved in called One Web is put an array of 2,000 satellites around the earth. That’ll be the biggest array of satellites in space and they can help connect the 4 Billion people who’re not connected today. If you’re not connected, and you can’t get Internet or wifi; it’s difficult for you to start businesses and help your children get educated in remote places….
Alison van Diggelen: What’s the timeline on that?
Richard Branson: One Web should be up and running in about 2 ½ years time (first launches are due to start in 2-3 months). Virgin Galactic’s mission is taking people into space, making them astronauts, and giving them an incredible experience and a chance to look back on this beautiful earth. Next year (2018) should be the year for Virgin Galactic, the year that VSS Unity goes into space, the year I go into space and we start taking people into space. Because Virgin Galactic – unlike what Jeff Bezos and Elon Musk’s are doing – is shaped like an airplane, like a spaceship (they’ve gone for big rockets) – it can go into space, it can come back, it can land again and we can grow it. So one day we can do point to point travel…
Photo: Richard Branson shows off Virgin Galactic’s VSS Unity. Credit: Jack Brockway
Alison van Diggelen: What does that mean? Rocket speeds around earth?
Richard Branson: We could potentially (laughter) send people into orbit at 18,500 mph which would mean you could go anywhere on earth in 45 minutes. Realistically, our bodies won’t cope with that so we most likely would send people into sub-orbital flight, traveling at more like 4,000 mph which would mean London to Australia in 3-4 hours, instead of 18 hours currently, so still a big step forward: much faster than Concorde was and still tremendously exciting.
Alison van Diggelen:What are the tech challenges to making that happen?
Richard Branson: The advantage we have today is something called carbon fiber and that is an awful lot lighter than metal – which is what Concorde was built with. That can also be used in the building of engines. A plane can be an awful lot lighter. The technology on supersonic engine power has moved ahead dramatically since Concorde. Unlike Concorde, which was built by British and French governments, and really never made any money, we think we can actually build planes to go supersonically that would be economically viable as well. Of course, as a private company they have to be economically viable…
Richard Branson: 20 years ago, BR existed in Britain and it was pretty dire to say the least…most government run companies are not great, so we said to the government we’d be willing to take over the West coast main line and we also promised we’d transform it. There were 8.5 million ppl using it then. We brought in the Pendolino train and this year we’ll have approx. 40 m people using it, but we’re restricted to ~130 mph – whereas our trains could be going 160 mph – because the track isn’t good enough. So we’ve been looking for technology that will transport people at much greater speeds. The exciting thing about Hyperloop is that if we could get a straight line between London and Edinburgh or London and Glasgow, we could transport people in about 45 minutes. That would open up the cities more than anything and the idea of being able to get into a pod…the pod could literally come to your office or your home, pick you up, go down a tunnel…the pod will connect to our system and then it takes off and 45 minutes later, a grandmother in Glasgow could find herself in London, the pod carrying on and taking her to see her grandchildren somewhere in London: A lot easier than the 4.5 hours it takes currently on trains.
Photo: Virgin Hyperloop One team: Giegel, Branson, Pishevar. Credit: Virgin.com
Alison van Diggelen:What’s your timeline on that? My mother is 85 and she has grandchildren in London…
Richard Branson: I’m a little younger than her and am determined that it will happen in my lifetime. I will try to make sure it happens in her lifetime. Obviously we have got to have discussions with the government, they are building a high speed line but I think this could be compatible with that – and could be separate from that: Great Britain needs a lot more capacity. Obviously it’s not just for Great Britain…We are talking to countries all over the world…
Gareth Mitchell: That’s Richard Branson, talking to countries all over the world, and also to Alison van Diggelen. Let’s talk to Bill Thompson.
Bill Thompson: I really wish I could believe the Hyperloop is something I’ll see in my lifetime. The idea is a very interesting one: vacuum tube, high acceleration, low friction. There are enormous engineering challenges. I do think that talking it up as if it’s just around the corner is too much of a distraction from solving the real problems of urban transportation. Getting permissions…sorting out the safety problems will take a lot more work. What happens if the power goes down when you’re traveling at several hundred kilometers per hour in a steel tube? I’m pleased to see it being talked about but I’m certainly not holding my breath.
Note: Virgin Hyperloop One was previously known as Hyperloop One and before that: Hyperloop Technologies. It’s distinct from rival: Hyperloop Transportation Technologies or HTT. Confused? Don’t be! Find out more here.
It’s estimated that there are over half a million tech job openings in the United States. A new initiative, the Tech Jobs Tour aims to connect “non-traditional” talent with tech job opportunities. It targets women, people of color, LGBTQs, veterans and disabled workers. Alison van Diggelen attended the San Francisco stop, on assignment for the BBC World Service.
“This is a crisis. There are so many open jobs. We have to come together as a country and solve this problem. We’re bringing people together…making connections to the Googles and Amazons of the world,” Leanne Pittsford, Founder Lesbians Who Tech
“Let’s make it so people can really build their own creative confidences, so that we can field the whole American team, the whole world team,” Megan Smith, former CTO for the Obama Administration
Or to the segment below, which includes bonus material that didn’t make the final BBC cut: a provocative rap by cyber security student, Chris Brooks (starts @6:00).
Here’s a transcript of the segment and a longer version my report (including highlights from Chris Brooks’s rap):
BBC Click Host, Gareth Mitchell: There are half a million vacancies in technology in the United States, so lots of people re-skilling. To help that along is a Tech Jobs Tour. It’s part road show, part boot camp, part job center. Alison van Diggelen was taking part in one recently. The tour rolled into San Francisco…
[Event atmos fade in…]
On stage:Service designer, front end designer, UX designer, full stack developer…
Alison van Diggelen: This is the Tech Jobs Tour. Stop number 8 on a 50 city tour of the US. Its aim: to connect “non-traditional” talent with tech job opportunities. This national initiative target women, people of color, LGBTQs, veterans and disabled workers.
Chris Brooks is here with his brother Dontay. They’re doing a 6-month coding bootcamp at the Stride Center in Oakland. Their dream jobs? Cyber security…
Dontay: We saw the opportunity for school and we just ran with it. We seen this conference right here and it looked exciting. We want to network, get our names out there. You gotta show up to do anything!
Alison van Diggelen: Do you feel through tech you can make your life better?
Chris Brooks: Taking advantage of any opportunity, any avenue we can go down…Really, I’m just trying to get my foot in the door…
Alison van Diggelen: The brothers are part of an eclectic group of aspiring techies who queued up around the block for this rare chance to meet some tech movers and shakers. I spoke with an Air Force vet, ex-entertainers, burned-out math teachers, fashionistas and an unemployed retails workers.
Megan Smith, former CTO of President Obama’s White House is one of the keynote speakers tonight and a powerful advocate for diversity…
Megan Smith: It’s like a career fair meets kind of a revival…All around are people from this community desperate for talent. 2000 people signed up tonight…people are coming out, they want to understand. The businesses need this talent. Really, it’s an ecosystem lift.
Alison van Diggelen: The evening features onstage Q&A with diverse speakers, face time with reps from major tech companies via “speed mentoring” and lots of networking opportunities. Tech Jobs Tour founder, Leanne Pittsford, paints their mission in stark terms, describing the half a million unfilled tech jobs…
Leanne Pittsford: There’s talent everywhere. This is a crisis. There are so many open jobs. We have to come together as a country and solve this problem. We’re bringing people together…making connections to the Googles and Amazons of the world.
Megan Smith extends that message globally.
Megan Smith: Let’s make it so people can really build their own creative confidences, so that we can field the whole American team, the whole world team. People would opt in with the passion of what they want to solve…
Alison van Diggelen: Be that social justice, the environmental crisis, poverty, etc…As well as tech hubs like Silicon Valley, the Tech Jobs Tour is stopping at a regions hardest hit by tech disruption and job off-shoring including Tennessee, Kentucky, and Wisconsin.
Leanne Pittsford: We really need investment in the middle of the country in places that typically don’t get funding from Silicon Valley.
Pittsford is also a women’s rights activist and founder of Lesbians Who Tech, an advocacy group.
Leanne Pittsford:We believe in intentional inclusion…there’s no way to remove bias. We’re programmed to hire people like us…that feels less risky. We believe in quotas, setting goals: all of our speakers…50% women, 50% people of color. We urge companies to set the same type of quotas…goals.
Photo caption: Stride Center instructor, Willie Lockett brought his class to the Tech Jobs Tour in SF. Photo by Alison van Diggelen, Fresh Dialogues
Alison van Diggelen: Pittsford says that about 60% of new technical people are getting their education* from short online courses and coding boot camps…a more affordable path for what she calls “non-traditional” talent. *It’s a trend highlighted this week by Hari Sreenivasan on the PBS Newshour
I chat with Audrey Zwibelman, one victim of tech disruption. A former apparel merchandiser at Macy’s, Gap and Levi’s. She’s doing what she describes as a mid-career pivot.
Audrey Zwibelman: My job moved to NY. It’s an industry that’s kind of dead or dying. The customer is shopping in a different way…
She’s bullish about training and job opportunities both here in Silicon Valley and across the world.
Audrey Zwibelman: No matter where you live, you can find those resources online. The remote accessibility that everyone has to be part of a company, means that people can work wherever they are. I think the opportunities are kinda limitless.
Leanne Pittsford sums up her goal for the Tech Jobs Tour…
Leanne Pittsford: Helping American innovation thrive… changing the face of tech and helping American innovation thrive. Diversity is better for your products, your team, and your bottom line. It affects all of us as an industry and as a country.
We have a community here today that is working really hard to change the landscape…trying to build a strong pipeline that represents the diversity of America…so if you’re hiring…
Alison van Diggelen: As yet, the model is unproven, but the team is traveling in hope.
Bonus Material
Here are highlights from Chris Brooks’s rap:
Chris Brooks: Climbing up a mountain
Young brother how come
Everybody’s dying by these guns?
I keep walking without one
Not trying to kill my brother
I’m trying to kill an album
Sell my story
Cos a good income’s a good outcome
Coming in due time
Millennials’ new minds
They tell them you look here
I tell you, you’re too blind
Just take a look around
My brother you’ll soon find
That the world is yours
Don’t let the hesitation haunt you…
Photo caption: Chris Brooks and his brother Dontay. Both are cyber security students at the Stride Center in Oakland.
As dramatic images of the Texas floods pour in, it’s timely to ask: would a tech mindset help cities be more responsive and efficient in their disaster response? The concept of transforming the culture of a city hall by adopting a tech approach is what I’ve been exploring this month for the BBC World Service. How would an agile, innovative tech mindset help to fix problems and meet community needs more quickly? My report aired this week on Business Matters and fellow guest Duncan Clark, Chairman of BDA, shared his perspective from Beijing.
Alison van Diggelen reports from Silicon Valley, on how a tech mindset is helping transform San Jose’s City Hall.
“I’ve been really encouraged with how willing people are to try new things. We’re seeing a culture shift here at city hall, that is interested in learning about technology and process improvement and customer driven innovation,” Erica Garaffo, Data Analytics Lead at San Jose City Hall
Here’s a transcript of the segment, edited for length and clarity:
The BBC’s Fergus Nicoll: We’ve been talking about urban management and weather. Time now to talk about simple urban management in the context of cities that aren’t content to wait for federal infrastructure investment. Alison’s been investigating this in San Jose, in the heart of Silicon Valley…
Alison van Diggelen: Some city managers are not holding their breath with the current administration in D.C. The Trump administration is behind on all major promises (infrastructure investment, tax reform etc.); so, here in San Jose, they’re adopting a tech approach to make City Hall more efficient, accessible and responsive to community needs like flooding. San Jose is leveraging its location in the heart of Silicon Valley to lead the charge. I’ve been exploring their game plan and I started by visiting Diridon Station, the main transport hub in San Jose’s city center, to find out from the locals what they think of the city.
[Atmos: Train, plane, bus traffic in downtown San Jose]
Glen Abbott: What public works you see being done are extensive street modifications and drainage that go on and on and on and never seem to reach completion! Somebody is buttering somebody else’s toast…
Chelsea Conrad: There’s a lot of graffiti and trash I’ve noticed…I think it should be cleaned up…It’s kind of an eyesore…
Alison van Diggelen: Meet Kip Harkness. He’s deputy city manager of San Jose, the self described “Capital of Silicon Valley.” Harkness dresses a la Steve Jobs in black turtleneck and blue jeans. A former Director at PayPal; today he wants to bring innovation and the “speed of business” to civic life in San Jose. With the enthusiasm of a tech evangelist, he demos the city’s latest release on his smartphone: It’s an app called “My San Jose”
Kip Harkness:Here we are at City Hall – you can see the pinpoints that are requests…you can see illegal dumping. Lots of illegal dumping!
Kip Harkness:It’s excites me. Now we know what the issues are. About 10,000 people have already downloaded the app…
Alison van Diggelen: He’s assembling what he calls “a tribe of innovators” to transform City Hall.
Kip Harkness:So we found some graffiti…it asks me if I want to take a picture. It confirms the location. Done, submitted, reference request is in there. Hopefully over the course of the day it will be processed in the system and that status will be updated.
[Atmos: scrum meeting discussion with Michelle Thong…laughter…]
Alison van Diggelen: I meet his “tribe” on the 17th floor of City Hall just before their daily “scrum” – a 15 minute standup meeting. Participants move sticky notes across a giant board to show the progress of their projects. An entire wall becomes a super-sized multicolored spreadsheet. Harkness enthuses about the nimble goal-setting approach and team peer pressure which speeds up action…
Kip Harkness:Championing the customer, learning from data and iterating to improve set apart the tribe. In typical government you do it all at once and push it out the door. We have a scrum cycle – a 2 week process, we reset goals, we evaluate how well we did. Every day we check in on our progress. Running government on scrum, as agile, is a completely different mindset from the traditional 5-7 years plans that characterize our history.
Alison van Diggelen: Erica Garaffo leads the team’s data analytics. She says her background in industrial engineering taught her about process improvement and ways to streamline business operations. She’s finding that can make big difference in delivering community services.
Alison van Diggelen: Would you say you “think different”?
Erica Garaffo: Yes! [laughter] Having the data lens affords me interesting perspective… from data we can see patterns, get insights, and we can take action… I’ve been really encouraged with how willing people are to try new things. We’re seeing a culture shift here at city hall, that is interested in learning about technology and process improvement and customer driven innovation…
Alison van Diggelen: San Jose’s Mayor, Sam Liccardo is helping drive this tech-centered approach.
Mayor Liccardo: We’re blessed to serve a community that’s the most innovative in the world…We’ve tried to create a platform here in the city for innovation – from great companies all around us, from our budding entrepreneurs. We’ve got a program called “Unleash your Geek” that’s got hundreds of folks from San Jose State University and others coming up with ideas to help us solve civic problems.
Alison van Diggelen: The City is partnering with Facebook to launch “Terragraph” in downtown San Jose – a new wireless internet system they say will offer the “fastest free wifi in the world.” It’s also partnering with a dozen tech companies to launch an autonomous vehicle pilot program on city streets.
Of course, San Jose is not unique in adopting a tech mindset. Many global cities are getting techie, from London to Singapore, and Berlin to Nairobi. But as Harkness point out, San Jose has a huge comparative advantage:
Kip Harkness: Literally down the street we have Adobe, the Paypal HQ, Cisco HQ in San Jose…Intel, Apple, Facebook, Google all within 30 miles of our city hall building. We can open up and chunk out our problems to all these tech companies and create a living laboratory for them try out new approaches, new tech and for us to learn from that secret sauce of Silicon Valley.
Fergus Nicoll: Great piece Alison. We’ve got some new expressions for you today: “running government on scrum;” “chunking out programs”… Is this going to work in China, Duncan?
Duncan Clark: China has a top down belief in technology. A lot of the senior officials are engineers themselves…sometimes they place too much emphasis on this. The key factor is the people in China are embracing technology, particularly through their smartphones. One example would be these Mobikes….where you can hop on a bike anywhere in Beijing or Shanghai or across the country. These are dockless bikes, so you don’t have to return them as you would in New York, London or Paris. You leave them anywhere, they have a GPS, and that’s contributing to a reduction in traffic… This is the private sector: Alibaba and Tencent are backing companies like these. The government also is also very on the ball on tech…
Continue listening to the BBC’s Business Matters program, as we discuss:
The potential benefits and synergies from the Whole Foods-Amazon merger
The Hyperloop: why it’s a crazy idea; and yet why it’s unwise to under-estimate Elon Musk’s latest brainchild.
Two court cases; multiple sexual harassment accusations; a 200,000 #DeleteUber campaign; and an exodus of senior executives. To say Uber’s had a bumpy start to the year is an understatement. You’d think the leadership at Uber would be curled up in a fetal position by now, gently whimpering. And yet, as Alison van Diggelen, host of Fresh Dialoguesreports for theBBC World Service, the fight for ride-sharing and self-driving car supremacy continues full tilt. This week, Uber confirmed it’s hired a top AI expert tasked with rapidly building a self-driving car team in Toronto, Canada. Alison spoke with Professor Raquel Urtasun (pictured above) yesterday and reported on Uber’s ongoing challenges for the BBC World Service earlier today.
Here’s a transcript of my report and conversation with Click’s host Gareth Mitchell (edited for length and clarity):
Gareth Mitchell: Today, more controversy at Uber. Has Uber been taking the regulators for a ride? According to the Reuters News Agency, the U.S. Justice Department has launched a criminal investigation into Uber software that helped evade the city transport officials. The tool, called Greyball was originally designed to foil would-be fraudsters from using Uber services. So protecting your drivers by deterring undesirable passengers, that’s one thing, but now the suspicion is that Uber has also been “Greyballing” city officials investigating unlicensed Uber cars. Portland, Oregon said Uber used Greyball to evade 16 of its transport officials in 2014, before Uber was officially authorized to operate there. I’ve been hearing more from our Silicon Valley reporter, Alison van Diggelen. We started by talking about Uber’s other woes…Uber and Google’s Waymo are not getting on very well…
Alison van Diggelen: No, not at all.
WAYMO VS UBER
Alison van Diggelen: Waymo – Google’s self-driving car spinoff – has accused Uber of stealing 14,000 files – including trade secrets. It concerns blueprints for Lidar, the spinning laser you see on top of self driving cars. At a hearing in San Francisco last week, the judge said Waymo didn’t yet have “a smoking gun” i.e. enough evidence to prove its technology was being used by Uber. We’re still waiting to hear whether the the judge will issue an injunction – that could impact Uber’s ability to use or develop this Lidar technology – and impact its entire self-driving car plans.
Uber’s Anthony Levandowski is accused of stealing Lidar secrets from Google’s Waymo, Photo credit: Quartz/Mike Murphy
There’s also a criminal court case at the early stages investigating the software tool – Greyball – that allowed Uber to evade and deceive regulators in several cities. Software was used to analyze profiles and credit card information of potential Uber users, to avoid it being available to law enforcement officials. All this is piling on uncertainty to Uber’s existing challenges -it puts its long anticipated IPO on hold indefinitely. (Uber may miss a good “window of opportunity” to go public, while the bull market endures. It’s been valued at about $70Bn, that’s $20Bn more than Ford!)
Gareth Mitchell: This Greyballing software. Initially, this was just a way for Uber to protect its drivers from dodgy customers and the allegations go that they’re using it this more evasive way when it comes to regulators.
Alison van Diggelen: That’s exactly right. When regulators tried to use the Uber app in places that it was forbidden at the time – like Portland, Paris, Las Vegas – They’d just get a fake site. It looked to them as though it wasn’t available.
Gareth Mitchell: Uber lawyers have told authorities in Portland, Oregon that the Greyball technology was used exceedingly sparingly….But what other challenges does it face, Alison?
HIGH PROFILE HIRING
Alison van Diggelen: Given the court cases; and a series of sexual harassment accusations and an exodus of executives recently, you’d think Uber would face huge hiring challenges. But yesterday Uber announced it’s hiring a high profile Artificial Intelligence expert – Raquel Urtasun, so a little bit of good news for Uber. She’s a professor at the University of Toronto. She’ll lead the expansion of Uber’s self-driving team in Canada.
I spoke with her yesterday and she told me she thinks the negative stories about Uber are overblown. She plans to build a team of several dozen within a year to develop what she calls the “perception algorithms” for self-driving cars … Basically, they’re building the brain of the car so that it can transform what it “sees” – via sensors and cameras into an explanation of “what” it is seeing.
She acknowledges that competitors (like Waymo) are still ahead – they’ve been working on the technology much longer (since 2009), but she insists that Uber is getting closer every day. But Uber has a long way to go: Recent reports show its self-driving cars travelled on average of 1 mile before a human driver had to take control. Google’s Waymo cars disengaged at a rate of once per 5,000 miles.
Gareth Mitchell: OK.That is Alison van Diggelen, talking to me just before we came on air.
[Online extra]
Alison van Diggelen: I also spoke with Anton Wahlman, a Silicon Valley Tech Analyst
He concludes that if Uber’s reported $3 billion loss last year is accurate, the company is operating at negative gross margins – ie subsidizing fares – to drive out competitors. Wahlman anticipates that as soon as prices rise to produce profitability, new competitors will simply enter the market. If Uber were a public company today he says he would short the stock.
FUTURE
There is mounting pressure for CEO Travis Kalanick to resign or step back from his leadership role. Since Uber began, he’s created an aggressive, “bad boy” culture at Uber and it’ll be hard to reboot that culture, but it’s still possible.
After all, replacing a founder (or founders) with a well established and experienced CEO is not unprecedented. Google appointed a “grown up” leader in its early days, not to change a “bad boy” culture but to drive rapid growth. Eric Schmidt, a veteran of Novell software, served as Google’s CEO for 10 years and passed the CEO position back to cofounder Larry Page in 2011. For now, it seems that Kalanick is holding tight to the steering wheel at Uber, but the pressure is growing for a co-driver to take over and navigate a safer, less turbulent road ahead.
The election of Donald Trump stunned the majority of people in Silicon Valley, but it also awakened many from their apolitical slumber. Today, leveraging technology is a key part of the national resistance movement. Alison van Diggelen, host of Fresh Dialoguesfound that Silicon Valley may be the epicenter of high tech, but old-school methods still have their place in the tech resistance, and techies are less partisan than you might expect.
(Photo credit: A young women protests at an immigration rally, by Chris Shipley/The First 100 Days Project)
“Good is going to come out of this difficult time. Too many people in Silicon Valley stood back from politics…it’s the context in which we’re building our businesses. We can’t continue to build democracy as if it’s all about capitalism and we can’t build capitalism without the context of democracy,” Chris Shipley, Founder The First 100 Days Project
Here’s a transcript of the report and discussion with Click’s host Gareth Mitchell and tech commentator, Bill Thompson (edited for length and clarity).
Gareth Mitchell: After 100 days (of Donald Trump’s presidency), what’s the view of the tech community? As Alison van Diggelen has been finding, attitudes aren’t quite as straightforward as you might think.
Mario Savio: There is a time when the operation of the machine becomes so odious, makes you so sick at heart that you can’t take part…and you’ve got to put your bodies upon the gears, and upon the levers, upon all the apparatus and you’ve got to make it stop!
Alison van Diggelen: That was Berkeley student activist Mario Savio in 1964. Once again, Berkeley has become a flashpoint of political protest. The election of Donald Trump left many people in Silicon Valley shocked and outraged. Coder, Nick O’Neill was dumbfounded last November. But by inauguration day, he’d found his voice. He launched an app called 5Calls that makes it easy for citizens to become political activists. His app has enabled over 1 million phone calls to members of Congress in all 50 states. In US politics, old fashioned phone calls are still the most effective leverage. Here’s O’Neill:
O’Neill: People have tweeted us: I’ve never called my representatives before…but because we made it so easy… we put the phone numbers, and the scripts and issues together in one place, that helped them get over that hump. They know exactly what the process is.
van Diggelen: O’Neill is just one of hundreds of Silicon Valley techies leveraging tech skills, and a startup mentality to create a resistance movement against the anti-immigration, anti-environment, anti-globalization stance of Trump’s administration. Apps and projects include: Tech Stands Up, Track Trump, Swing Left, and the Tech for Campaigns Project…
What made the tech community wake from its apolitical slumber?
(Photo: “President Trump…therefore we resist” Interview with 5Calls Founder, Nick O’Neill at the Thinkers Cafe in San Francisco)
O’Neill: All these people feel disenfranchised, a little bit helpless, and so we’re all trying to build things to see what sort of change can make….The tech approach is to jump first, build things and see if it sticks. It’s the ethos that runs behind tech…
van Diggelen: But not all tech reactions are partisan. At the Free Speech Movement Cafe on Berkeley’s campus, I met with Ash Bhat, a 20-year-old student. He explains how Trump’s rhetoric felt personal for many, especially his Muslim and undocumented classmates. But it was a violent demonstration against a right wing provocateur on campus that inspired him to act.
Bhat: It was depicted as a group of Berkeley students destroying their own school and that couldn’t be further from the truth. Anarchists came in, breaking windows… I remember being in my rhetoric class, going to WhiteHouse.org …looking through the source code and I was like: hey this looks pretty scrape-able.
van Diggelen: Bhat found he can “scrape” or extract data updates from the White House every time an executive order is signed. The Presidential Actions app launched and his team now boast of tens of thousands of users across the political spectrum. They’ve resisted partnerships with partisan groups.
(Photo: Ash Bhat and I discussed the power of resistance in the Free Speech Movement Cafe in Berkeley. It’s dedicated to Mario Savio, whose passion inspired thousands of students and activists worldwide)
Bhat: As someone in tech, it’s a responsibility for us to build software that helps inform the public… be compassionate towards both sides and provide unbiased bipartisan information. There’s a lot of talk about the resistance…my worry is being too tied to a polarized side just feeds the echo chamber. The people who’re afraid of tech will no longer listen to it…
van Diggelen: How will he ensure Presidential Actions information is unbiased?
Bhat: We’re taking the actual docs from the White House, first hand primary documents, we’re looking at summarization algorithms as opposed to subjectively summarizing contents… We want to be able to present the news to our users so that they can come to their political conclusions completely by themselves.
van Diggelen: But the tech resistance isn’t all bits and bites. Remarkably, old fashioned ink and paper is part of its arsenal.
Chris Shipley has advised over 1500 startups in Silicon Valley. After the Women’s March in Washington DC, she was inspired to create “The First 100 Days Project” to chronicle citizen activism in stunning visual images. Her Indiegogo campaign aims to make commemorative postcards and a book. Why so old-school?
(Photo: Chris Shipley’s project aims to support “at risk” organizations such as Planned Parenthood, The Environmental Defense Fund and arts organizations)
Shipley: There’s something ephemeral about digital media – it a wonderful expression, a wonderful reach, but then we go to the next url and we’re on to something else. A book, a postcard, something you can hold in your hands has this reminder effect..a book can sit on your table, someone can pick it up, flip through it and come back to it again and again, and be reminded of the conversations happening in DC, in SF and Seattle, one march after another…
van Diggelen: But of course she’s leveraging technology via social media:
Shipley: Text msgs, IMs, Twitter, all social channels are ways of building awareness…allow the message to be amplified. It’s very gritty, hand to hand combat. If there’s a tech to get the message out, we’re going to use it.
van Diggelen: Shipley admits that her project is aimed at progressives, but is emphatic that they want to be heard and listen to the other side too…
Shipley: We’re in a really pivotal time. I’m a casual optimist, good is going to come out of this difficult time. Too many people in Silicon Valley stood back from politics…It’s the context in which we’re building our businesses. We can’t continue to build democracy as if it’s all about capitalism and we can’t build capitalism without the context of democracy.
Bill Thompson: A certain sector of the tech community has been enlivened by the election of Trump to deploy their skills. It’s always good when people get engaged in politics, but I’m reminded of Evgeny Morozov‘s book “To Save Everything Click Here” and part of me wonders how much real engagement these apps will get. There’s a danger of it descending into “clicktivism.” The app that encourages people to phone their representatives about issues that matter to them – on whatever side of the political fence you are – is a really important development there.
Gareth Mitchell: It’s a bit more active than clicking on something you agree with…you have to take some action…
Bill Thompson: Exactly. It’s not just “liking” something. It’s designed to take you through to be really engaged with politics. At a time when the U.S. does seem slightly fractured, it’s good to have things which encourage people to be politically active and argue for the things they believe in.
Gareth Mitchell: Yes, and follow people on Twitter with whom you don’t agree!
Scott Kupor: It depends on what pirate means (audience laughter).
(Photo: “President Trump…therefore we resist” Interview with 5Calls Founder, Nick O’Neill at the 
(Photo: Ash Bhat and I discussed the power of resistance in the 
(Photo: Chris Shipley’s project aims to support “at risk” organizations such as Planned Parenthood, The Environmental Defense Fund and arts organizations)
