One of the highlight speakers during the recent True North conference in Waterloo, Chairman Mom and Pando founder Sarah Lacy pulled no punches talking about what’s wrong with Silicon Valley and just how it got to this point.
Lacy sat down with BetaKit editor-in-chief Douglas Soltys to reflect on some of the points made during her talk, doubling down on “everything Silicon Valley fucked up.”
When BetaKit last covered Sarah Lacy, she was speaking at Montreal’s 2017 Startupfest about how toxic masculinity had seeped into Silicon Valley’s culture. Around that time, Silicon Valley was having its own Me Too movement, with 500 Startups founder Dave McClure and Robert Scoble, among others, facing allegations of sexual misconduct.
Over a year later, Lacy said that she understands that while some find it “frustrating” that only the tip of the iceberg was exposed, she appreciated the measured way journalists approached these stories without turning them into a “witch hunt.”
“I think it did dramatically change the conversation and it was a shift,” said Lacy. “Every woman I know — whether a journalist, whether a PR person, whether a founder — getting inappropriately propositioned was part of life in Silicon Valley,” said Lacy. “I would never think a VC would lose their job over that, much less a fund. Just setting that standard was such a dramatic shift even though people don’t feel like it won’t far enough.
“When there’s these dramatic cultural things, there’s this after-effect where people want to normalize it all again. But we don’t even really see the ripple effects until years later.”
Asked about her comments onstage that Canada is not as toxic as what we’ve seen in the Valley, Lacy said that she’s “sure” that the Canadian version of 500 Startups exists. However, she said that there are things about toxic bias in America that are “uniquely” American in the way they’re expressed.
“People are in a place where they value paying for something on the internet for the first time.”
The journalist pointed to the history of how Silicon Valley had developed its particular strain of toxicity — it’s a place that has always considered itself a meritocracy, but while the people who have done well there historically are young, white men, they still feel marginalized before their success.
“Silicon Valley is where they got to feel their power… and they felt they succeeded because they were smart,” said Lacy. “It wasn’t because of their looks, it wasn’t based on athletic ability or things that might have stigmatized them growing up. To now face that they had a massive advantage that people of colour and women didn’t is an existential threat. And that’s throughout America right now.”
Lacy pointed to other dynamics swirling within Valley culture that has propagated a ‘bro economy’: the “cult of the founder,” massive and unending injections of funding capital, and the fear of missing out leading VCs to invest in problematic but potentially profitable companies.
“Ninety percent of the returns come from five percent of the companies,” said Lacy. “What 95 percent of the companies in Silicon Valley do, and how they build their businesses, and how they conduct themselves, has no bearing on the culture of Silicon Valley. Because everything that’s going to be on magazine covers, or pattern-recognitioned, or emulated, or held up as an example, is from five percent of companies.”
To tackle the issue head-on, Lacy’s talk emphasized the important of diversity, moving away from ad-driven business models, and VCs getting a backbone. In the wake of scandals like Facebook has seen with Cambridge Analytica, Lacy said that consumers are now in a place where they want to support companies that are trying to do good.
“People are in a place where they value paying for something on the internet for the first time,” she said.
Feature image courtesy Harminder Phull, Communitech