Tech tycoons who like to back winners are lurching to the right.
Marc Andreessen and Ben Horowitz, founders of a venture fund backing startups like OpenAI and SpaceX, are the latest Silicon Valley giants pledging to finance Donald Trump’s presidential campaign.
So what? Parts of Northern California are turning purple. In 2020 San Francisco was declared “the bluest part of California” and Joe Biden took 86 per cent of the vote. Four years on, Silicon Valley’s blue wall is crumbling thanks largely to a vocal group of high-profile Trump backers.
“Silicon Valley likes to present as liberal, but folks here are really libertarian disruptors and free market mavens in their ethos,” the venture capitalist Jason Calacanis tells Wired. The wave of recent Republican support reveals a conservatism that has long been present – it’s just no longer taboo.
Who’s pro-Trump?
- On Monday former Democrat Elon Musk said he planned to commit around $45 million a month to a new, Trump-backing super political-action committee called America PAC. Andreesen and Horowitz followed suit a day later.
- America PAC has already raised more than $8.7 million from 13 tech titans including the Winklevoss twins (early investors in Facebook); Doug Leone, former managing partner of Sequoia Capital; and Palantir co-founder Joe Lonsdale.
- Last month Trump and JD Vance, now his VP pick, travelled to a $50,000-a- head fundraiser at a San Francisco mansion hosted by former-Democrat tech investors David Sacks and Chamath Palihapitiya. Sacks once said Trump’s actions during the January 6th riots made him unelectable. The event raised $12 million for the Trump campaign.
Who’s not?
- Ross Gerber, a Silicon Valley investor and a Democrat, says the billionaires backing Trump are in a minority in tech, and many Biden-backing businesspeople are staying silent because wading into politics is toxic and “bad for business”.
- As of this month Democrats were receiving more money from tech firms than during the previous election cycle. LinkedIn co-founder Reid Hoffman and venture capitalist Vinod Khosla are among the high-profile entrepreneurs sticking with Biden.
- Peter Thiel, once a lonely Republican voice in tech and a major financial backer of the 2016 Trump campaign, has said he won’t give money to America PAC and will only vote Trump “if you hold a gun to my head”.
But PAC America could signal a sea change. The voices backing Trump today are influential – and vastly wealthy.
Why now? The startup tech sector grew eight-fold between 2012 and 2022 to $344 billion. It’s now stagnating thanks to high interest rates, which slowed the flow of capital. Biden’s detractors blame him, and they’ve been spooked by his recent policy proposals, including:
- High taxes. In March, Biden proposed $5 trillion in additional taxes on corporations and high earners over the next decade. That included a 25 per cent “billionaire tax” on holdings that could include startup stock. “Biden has a disdain towards rich people, and he’s made that disdain clear, and it’s also alienated people like me who are traditional liberal Democrats,” Gerber says.
- AI regulation. An open letter from founders and investors last November accused Biden of stifling innovation in his attempt to create safeguards around the development of AI.
- Competition crackdown. Democratic regulators have promised to crack down on anti-competitive practices in AI, setting the stage for antitrust probes into Nvidia, Microsoft and OpenAI – a push led by the Biden-appointed chair of the Federal Trade Commission, Linda Khan.
Vance’s stance. JD Vance was briefly a venture capitalist in San Francisco before entering politics, and he owns stakes in a Catholic meditation app and Rumble, the right-wing social media app. Tech leaders hailed his appointment; Musk said it “resounds with victory”. But he’s not the libertarian business leaders might be dreaming of.
- Vance has praised Khan – the FTC chair with a reputation for tech busting. In February he said she was “doing a pretty good job”.
- He’s called for Congress to row back aspects of Section 230, which shields tech platforms from liability for content posted by users.
What’s more. The real issue facing Silicon Valley is Biden’s “cognitive decline,” Gerber says. “People don’t want to come out and say that they’re for Biden.” If another Democratic candidate took his place, “I think you’d see real money people backing [the Democrats].”
