yesIssie LapowskyNone
×

Get access to Protocol

Will be used in accordance with our Privacy Policy

I’m already a subscriber
Politics

Beyond the megadonors, Silicon Valley is still stingy about donating to politicians

The tech industry has minted some of the wealthiest people in the world in record time. But many of them are still reluctant to get in the arena.

Beyond the megadonors, Silicon Valley is still stingy about donating to politicians

Despite the industry's enormous wealth, Big Tech is still giving relatively small amounts to politicians, compared to other industries.

Image: Getty Images

Silicon Valley has minted some of the world's wealthiest people in record time. But compared to other industries, a new analysis by Protocol shows, a relatively small slice of that wealth is being spent on the 2020 election. While the past decade has made millionaires and billionaires of loads of tech founders and Big Tech leaders, most of them remain deeply reluctant to donate to politicians.

"My read, as a member of the tech community, is that we have significantly large percentages of our community who have the ability to give to campaigns who just aren't," former Pete Buttigieg national investment chair Swati Mylavarapu told Protocol this spring. Mylavarapu and her husband, Matt Rogers, the co-founder of Nest, committed to giving $2 million to political campaigns before July 2020. "If you look at the subset of people who are actually hosting fundraisers and making contributions, it's a surprisingly small percentage," she said.

Sure, Big Tech's political megadonors have spent lavishly on Democratic campaigns this election cycle. According to a recent count by Recode, the top 15 donors who have made their money from tech have given a whopping $120 million in federal campaign contributions over the last two years. And contributions across the industry are growing substantially compared to elections past. But look beyond the shortlist of megadonors — beyond the Karla Jurvetsons and Dustin Moskovitzes and Reid Hoffmans — and Silicon Valley's contributions to politicians, particularly the ones running for president, begin to look stingy compared to other industries.

A recent Forbes analysis of U.S. billionaire contributions to Trump and Biden found that tech billionaires are both outnumbered and outspent by billionaires from the financial sector. That's despite the fact that eight of the top 10 richest people in America made their money from tech.

According to data from the Center for Responsive Politics, among the top 20 donors to all federal campaigns and committees this cycle, only two — Jurvetson and Moskovitz — made their money from the tech industry. (Three if you count Michael Bloomberg, which we are not.)

These figures don't include contributions to dark money groups, but are telling nonetheless. And remember that when tech founders got rich, from Facebook or Google or Microsoft or PayPal, they weren't alone: In lots of cases, a swath of early investors and employees got rich, too. But according to data from The Center for Responsive Politics on total donations to the 2020 presidential race by sector, donors from the tech industry don't even make it into the top 10.

Those numbers don't include contributions to down-ballot races and can, of course, be skewed by a single individual like Sheldon Adelson, the casino magnate and Republican megadonor who consistently puts the casino industry on the map.

Tech companies are similarly scant when the data is sliced to show top donors by organization. The Center for Responsive Politics tracks donations both from corporate PACs and from individuals who work at those companies, which means it would include not just the megarich CEOs and founders of big tech companies, but all of their employees, too. Even so, according to the figures, the only tech company among the top 20 organizational donors this cycle was Alphabet, which clocked in at No. 14. Only two others — Microsoft and Amazon — even make it into the top 50.

Protocol also recently analyzed the biggest donors at Amazon, Apple, Facebook, Google and Microsoft, and found that not only had none of the companies' CEOs made large donations to candidates this cycle, but the average size of the top donors' biggest checks was just over $183,000 — sizable, but far short of the seven-figure checks that the largest donors are writing.

"There are a large number of uber-wealthy people who just don't want to get hit," said one top Democratic fundraiser who asked to remain anonymous. "For them to have such large checks under their name would put their companies needlessly in harm's way by the Republicans. There's no point."

Silicon Valley wealth extends far beyond the big five companies, of course. The past decade has made billionaires of dozens of founders whose companies either sold or went public, but many of them are also hesitant to donate to politicians. Protocol compared Federal Election Commission records to data on the top 20 U.S. venture-backed tech exits of the last decade provided by PitchBook and found stark differences between founder-CEOs and founders who have moved on or taken on less public roles within their companies.

Case in point: While Mark Zuckerberg has focused his political giving on ballot measures and election preparedness this year, his Facebook co-founders Moskovitz, Chris Hughes and Andrew McCollum have spent big supporting Biden and other Democrats. Moskovitz, in particular, has spent some $24 million up and down the ballot this cycle.

It's similar across the sector. While Twitter's Jack Dorsey contributed small amounts during the Democratic primary, his Twitter co-founder, Evan Williams, who now heads up Medium, has written a $250,000 check to the Biden Victory Fund. At Palantir, CEO Alex Karp has contributed $2,800 to Biden's campaign. His co-founder, Republican megadonor Peter Thiel, meanwhile gave $850,000 to a committee supporting Kris Kobach's Kansas senate primary race.

Two notable exceptions: Lyft President John Zimmer and CEO Logan Green together contributed $100,000 to the Senate Majority PAC, a Democratic group, and wrote smaller checks to dozens of other campaigns.

Concerns about appearing overly partisan at a moment when the president himself claims to be running against Big Tech are definitely standing in the way of some tech execs. But beyond the impact that donating can have on their reputations, tech donors often also prefer to have more control over how their money gets spent, according to the Democratic fundraiser. That can sometimes lead them to make bigger bets on, say, political tech companies, like Alloy, a Democratic data firm that LinkedIn founder Reid Hoffman and former U.S. Chief Technology Officer Todd Park funded to the tune of $35 million. Former Google CEO Eric Schmidt has also reportedly funded 20 political startups through an outfit called OneOne Ventures.

Raffi Krikorian, a former Uber and Twitter exec and current managing director of The Emerson Collective, a philanthropic group funded by Laurene Powell Jobs, says an equally big barrier to political donating in Silicon Valley is a lack of education. Newly wealthy techies, he says, often don't want to align themselves with one candidate or another and prefer to donate to causes that are either nonpartisan or that don't have to disclose their donors. "I've had to get on the phone with people this cycle to say […] 'You don't just have to give money to candidates. There's other places you can give your money to make a difference this cycle,'" Krikorian said. "They just didn't know this is the case."

Krikorian added: "Then you've got the Coinbases of the world, who are asshats."

While the pool of political donors in tech is still relatively small, there are clear signs it is growing. As Recode noted, the top 15 tech donors this year had given only $7 million in collective federal political contributions prior to 2016. But that election changed everything. "Trump is as anti-Silicon Valley thinking as there could ever be a politician," the Democratic fundraiser said. "There was a visceral negative response to Trump once he won."

Silicon Valley is beginning to catch up on the political money race, in other words. But it's still got a long way to go.

Protocol | Fintech

Jack Dorsey is so money: What Tidal and banking do for Square

Teaming up with Jay-Z's music streaming service may seem like a move done for flash, but it's ultimately all about the money (and Cash).

Jay-Z performs at the Tidal-X concert at the Barclays Center in Brooklyn in 2017.

Photo: Theo Wargo/Getty Images

It was a big week for Jack Dorsey, who started by turning heads in Wall Street, and then went Hollywood with an unexpected music-streaming deal.

Dorsey's payments company, Square, announced Monday that it now has an actual bank, Square Financial Services, which just got a charter approved. On Thursday, Dorsey announced Square was taking a majority stake in Tidal, the music-streaming service backed by Jay-Z, for $297 million.

Keep Reading Show less
Benjamin Pimentel

Benjamin Pimentel ( @benpimentel) covers fintech from San Francisco. He has reported on many of the biggest tech stories over the past 20 years for the San Francisco Chronicle, Dow Jones MarketWatch and Business Insider, from the dot-com crash, the rise of cloud computing, social networking and AI to the impact of the Great Recession and the COVID crisis on Silicon Valley and beyond. He can be reached at bpimentel@protocol.com or via Signal at (510)731-8429.

Sponsored Content

The future of computing at the edge: an interview with Intel’s Tom Lantzsch

An interview with Tom Lantzsch, SVP and GM, Internet of Things Group at Intel

An interview with Tom Lantzsch

Senior Vice President and General Manager of the Internet of Things Group (IoT) at Intel Corporation

Edge computing had been on the rise in the last 18 months – and accelerated amid the need for new applications to solve challenges created by the Covid-19 pandemic. Tom Lantzsch, Senior Vice President and General Manager of the Internet of Things Group (IoT) at Intel Corp., thinks there are more innovations to come – and wants technology leaders to think equally about data and the algorithms as critical differentiators.

In his role at Intel, Lantzsch leads the worldwide group of solutions architects across IoT market segments, including retail, banking, hospitality, education, industrial, transportation, smart cities and healthcare. And he's seen first-hand how artificial intelligence run at the edge can have a big impact on customers' success.

Protocol sat down with Lantzsch to talk about the challenges faced by companies seeking to move from the cloud to the edge; some of the surprising ways that Intel has found to help customers and the next big breakthrough in this space.

What are the biggest trends you are seeing with edge computing and IoT?

A few years ago, there was a notion that the edge was going to be a simplistic model, where we were going to have everything connected up into the cloud and all the compute was going to happen in the cloud. At Intel, we had a bit of a contrarian view. We thought much of the interesting compute was going to happen closer to where data was created. And we believed, at that time, that camera technology was going to be the driving force – that just the sheer amount of content that was created would be overwhelming to ship to the cloud – so we'd have to do compute at the edge. A few years later – that hypothesis is in action and we're seeing edge compute happen in a big way.

Keep Reading Show less
Saul Hudson
Saul Hudson has a deep knowledge of creating brand voice identity, especially in understanding and targeting messages in cutting-edge technologies. He enjoys commissioning, editing, writing, and business development, in helping companies to build passionate audiences and accelerate their growth. Hudson has reported from more than 30 countries, from war zones to boardrooms to presidential palaces. He has led multinational, multi-lingual teams and managed operations for hundreds of journalists. Hudson is a Managing Partner at Angle42, a strategic communications consultancy.
Power

Google wants to help you get a life

Digital car windows, curved AR glasses, automatic presentations and other patents from Big Tech.

A new patent from Google offers a few suggestions.

Image: USPTO

Another week has come to pass, meaning it's time again for Big Tech patents! You've hopefully been busy reading all the new Manual Series stories that have come out this week and are now looking forward to hearing what comes after what comes next. Google wants to get rid of your double-chin selfie videos and find things for you as you sit bored at home; Apple wants to bring translucent displays to car windows; and Microsoft is exploring how much you can stress out a virtual assistant.

And remember: The big tech companies file all kinds of crazy patents for things, and though most never amount to anything, some end up defining the future.

Keep Reading Show less
Mike Murphy

Mike Murphy ( @mcwm) is the director of special projects at Protocol, focusing on the industries being rapidly upended by technology and the companies disrupting incumbents. Previously, Mike was the technology editor at Quartz, where he frequently wrote on robotics, artificial intelligence, and consumer electronics.

Transforming 2021

Blockchain, QR codes and your phone: the race to build vaccine passports

Digital verification systems could give people the freedom to work and travel. Here's how they could actually happen.

One day, you might not need to carry that physical passport around, either.

Photo: CommonPass

There will come a time, hopefully in the near future, when you'll feel comfortable getting on a plane again. You might even stop at the lounge at the airport, head to the regional office when you land and maybe even see a concert that evening. This seemingly distant reality will depend upon vaccine rollouts continuing on schedule, an open-sourced digital verification system and, amazingly, the blockchain.

Several countries around the world have begun to prepare for what comes after vaccinations. Swaths of the population will be vaccinated before others, but that hasn't stopped industries decimated by the pandemic from pioneering ways to get some people back to work and play. One of the most promising efforts is the idea of a "vaccine passport," which would allow individuals to show proof that they've been vaccinated against COVID-19 in a way that could be verified by businesses to allow them to travel, work or relax in public without a great fear of spreading the virus.

Keep Reading Show less
Mike Murphy

Mike Murphy ( @mcwm) is the director of special projects at Protocol, focusing on the industries being rapidly upended by technology and the companies disrupting incumbents. Previously, Mike was the technology editor at Quartz, where he frequently wrote on robotics, artificial intelligence, and consumer electronics.

Protocol | Policy

Bad news for Big Tech: Bipartisan agreement on antitrust reform

Democrats and Republicans found common ground during the first House hearing on antitrust of the new Congress. Here's what that means for tech giants.

The House Judiciary antitrust subcommittee held their first hearing of the 117th Congress.

Photo: Tom Williams/Getty Images

During the first House antitrust hearing of the new Congress, Democratic chairman David Cicilline and Republican ranking member Ken Buck made it clear they intend to forge ahead with a series of bipartisan reform efforts that could cut into the power of the largest technology companies.

"We will work on a serious bipartisan basis to advance these reforms together," Cicilline said during his opening remarks Thursday.

Keep Reading Show less
Emily Birnbaum

Emily Birnbaum ( @birnbaum_e) is a tech policy reporter with Protocol. Her coverage focuses on the U.S. government's attempts to regulate one of the most powerful industries in the world, with a focus on antitrust, privacy and politics. Previously, she worked as a tech policy reporter with The Hill after spending several months as a breaking news reporter. She is a Bethesda, Maryland native and proud Kenyon College alumna.

Latest Stories