Why tech’s titans are struggling to work together against Trump’s havoc

Image: bloomberg via getty images

On a daily basis, Stewart Butterfield roasts Donald Trump on Twitter.

The Slack CEO is among the most outspoken leaders in the tech community when it comes to the new chairman, which induced it all the more surprising to consider his company missing from the list of 97 tech giants that signed onto an amicus brief resisting the recent Muslim travel banarguably the most unified, aggressive action ever taken by the industry on a political issue.

Turns out, Slack wasn’t a holdout. They just got left off an email.

“Slack heard about this when it appeared in the media and of course we support it, ” a Slack spokesperson explained over email Monday morning. “Its our understanding that a supplemental one is being filed and Slack will be on that list.”

So runs the behind-the-scenes madness as tech companies big and small work to triangulate public policy , now, on a near-hourly basisoften trying their best not to stray too far toward activism or be seen as too close to the administration.

As the tech industry has matured, many of its bigger players have begun to exert power in politics, thanks in part to deep pockets that can buy expensive lobbyists.

Lobbyists can help push friendly policy, but they’re not crisis directors. Under Trump, even veterans like Google face a threat they haven’t quite ensure before.

“The tech industry is younger historically, ” said Erik Grimmelmann, the president of the NY Tech Alliance, with decades working in tech under his belt. Trump’s recent actions have serve as a “wake up call” for better coordination. “I think the tech industry has had fewer people thinking about these matters than they realise they need.”

Slow, tone-deaf answers have already cost some companies greatly. Uber in particular has born the brunt of the anti-Trump movement, thanks in part to its CEO’s participation in one of the president’s business council. He has since stepped down from the board. Elon Musk, however, kept his spot. His companies SpaceX and Tesla were also not part of the original 97 but were present at the next round.

Slow, tone-deaf reactions have already expense some companies greatly.

Many companies had clearly been hedging their wagers. Politico reported Tuesday that several of the tech giants who were on the original lawsuit or signed the amicus briefincluding Amazon, Google, Microsoft and Facebookdonated cash and service to Trump’s inauguration.

Intel, despite represent one of the 97 signees, participated Thursday in what can only be described as an informercial, next to President Trump, at his desk, in the White House.

Many of these companies and their CEOs tend to portray their work as having a higher purpose. Which attains the slow( and from time to time, contradictory) reply of tech companies to the administration’s actions magnified under a not-so-flattering light.

Erica Baker, an engineer at Slack and an advocate for tech diversity and inclusion, summed it up Monday night at TechCrunch’s Crunchies eventanother Silicon Valley show now riddled with heightened nervousnes in the Trump era 😛 TAGEND

Yet, with Trump taking such swift actions, as government contracts and future partnerships remain on the line, tech companies are still treading lightly, debating both internally and externally with their friends in the industryor foeson how and when to participate.

“Were all trying to respond as quickly as we can”

A spokesperson at a different tech company, who was one of the 97, asked which amicus brief Mashable refers to in a request for remark Sunday evening on if they were participating, prior to its official filing.

“It’s hard for big companies to move quickly, and so the fact that 97[ companies] did that so quickly is a testament to the importance of the questions, ” Grimmelmann said. “It’s hard to get everyone to agree to the same speech instantly. Were going to see a lot of ongoing discussion in terms of what declaration of principles should be made.”

Even before Trump, the tech industry’s relationship with the government was beginning to show signs of problems.

The topic of encryption, for example, was a flowing dialogue with the White House under President obama. Following Edward Snowden’s leak of the National Security Agency’s surveillance program, tech companies teamed up to cut access. In 2010, Google released the first transparency report, highlighting the requests of private information by the government.

Tech companies also banded together following the FBI’s lawsuit against Apple, to access the iPhone of the San Bernardino shooter. Tech companies do look for friends in these situations, taking ethical and legal stands on issuesdespite these stands, they remained in dialogue with Barack Obama, the so-called tech president.

Yet, tech companies wespoke with said they did feel a sense of urgency for the purposes of the new administration. For one, immigration is an issue on which most tech companies can agree. There’s already a shortage of talented technologists, and many tech leaders and high-profile investors are immigrants themselves.

Several companies who missed the opportunity or chose not to sign the original amicus brief have since issued their own letters to the court. The names include Fitbit, Postmates, Soundcloud, Spothero, OneLogin and GoDaddy.

Now that the tech industry is beginning to move as one to oppose Trump, there’s more action in the works.

A letter currently being passed around among tech companies features actual policy proposals , not only a broader look at why immigration is important. “We share your goal of ensuring that our immigration system gratifies todays security needs and keeps our country safe, ” reads a draft of the letter, obtained by Bloomberg . “We are concerned, however, that your recent Executive Order will affect many visa holders who work hard here in the United States and contribute to our countrys success.

That piece, however, is still being debatedmeaning plenty of late-night emails and phone calls, trying to figure out how to strike the right balance.

“Things are being pursued so fast, ” said a spokesperson at a tech company that did not sign the amicus brief. “You’re going to see so many of these that get signed.”

Internet Association, a trade organization that includes Airbnb, Uber, Facebook, Google, Snap( to name a few ), said it has been and will continue to be involved in dialogues like immigration but that is just one issue to discuss over the next four years.

“Were merely in week three of the administration, ” told Noah Theran, spokesman of Internet Association. “While immigration is plainly a very important issue to the companies that we represent, as it is to many companies in the broader economy, there are going to be many other areas where we can agree and work together with the administration to help the internet thrive.”

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Tech’s Wealthy Enclaves Hurt the Countryand Tech Itself

On a dreary Thursday afternoon in March, the halls of the Russell Senate Office Building in Washington, DC, swelled with people who spend their lives trying to salvage the economies of America’s forgotten towns. Hailing from across the country, they hurried past Majority Leader Mitch McConnell’s office in their sharp suits and jewel-toned dresses, each one carrying a different proposal for how to keep their cities and states afloat.

Together, they reflected America’s diversity: a mixture of millennials, Gen Xers, and baby boomers, men and women of different races and religions. So no, they were not members of the United States Senate.

They were startup founders, venture capitalists, and academics who had come to DC for the Rise of the Rest Summit, convened by AOL founder Steve Case and his investment firm to call attention to tech and innovation outside the coastal hubs where the industry remains largely cloistered. In a great marble-columned room, the Rest had gathered: people like Darcy Howe, a retiree who hosts dinner parties in her Kansas City, Missouri, home for early stage investors, and Jill Ford, a former angel investor from San Francisco who moved to Detroit to become the city’s head of innovation and entrepreneurship.

“It gives you a real view of how small businesses are in many ways fueling America,” Ford told the crowd. “They’re the source of inspiration for young people as they’re getting introduced to what is possible for them.”

The mood was light as the crowd snacked on soda and cookies and applauded each others hard work. But the very need for such an event underscored one of the country’s great 21st century divides: the deep economic imbalance between the tech industry in its enclaves and the rest of the American people.

For too long, Silicon Valley’s rainmakers have poured the vast majority of their billions into businesses in just three states: California, New York, and Massachusetts. They’ve created showy islands of wealth in those places, exacerbating economic tensions now roiling Washington between coastal elites and the rural poor. Ironically, because the industry has concentrated its wealth, talent, and votes in so few places, it has simultaneously undermined its own political clout.

Silicon Valley, in other words, has gerrymandered itself, helping to stir the ill will that empowers President Trump to bulldoze over many of the policies tech leaders care about, from climate protections to immigrant rights. The tech industry has become economically, politically, and culturally isolated from much of the rest of the US. As those entrepreneurs roaming the halls of the Senate hoped to make clear, it’s in tech leaders’ best interests—and the interest of the country—to start looking beyond the coastal metropolises they call home.

Rich Getting Richer

Ross Baird may be one of the only venture capitalists besides Peter Thiel who saw President Trumps win coming, and for good reason. Baird’s firm, Village Capital, has invested about 60 percent of its capital in states that Trump won. (Only about 15 percent of venture capital overall goes into those states.) As he traveled the country meeting entrepreneurs, Baird witnessed firsthand the frustration business owners and employees felt about the growing economic divide.

“The way we allocate our resources in the investor world right now makes all other issues harder to solve,” says Baird, whose firm co-sponsors the Rise of the Rest effort with Case’s VC firm Revolution. “Over time, the best-off cities get better and better, and the worse-off lose more people, more businesses, more talent.”

But the tech industry, confident in its belief it was creating a better future for the world, never paid much attention to that disparity. As a result, it systematically weakened its hand in Washington, Case argues. In the quid pro quo world of US politics, he says the tech industry has tended to hold government at a distance until it needs something. “People start coming to Washington, but only to deal with issues that are, frankly, selfish,” Case says.

Little wonder then that representatives from other parts of the country would be reluctant to, say, fight for more worker visas to fill the engineering talent gap in US tech when their own constituents are underemployed. Or that they’d hesitate to fight for green tech when coal has served as the lifeblood of their districts.

“If tech isn’t really in their districts other than people using iPhones and companies having computers, its harder for a member of Congress, even a member thats sympathetic, to put them at the front of the line,” says Rob Atkinson, founder of the Information Technology and Innovation Foundation.

If the tech industry wants more leverage at the federal level, Atkinson says, it needs to do a better job explaining to the rest of the country how it too can benefit from the economic upheaval tech is spurring. And then the tech industry needs to put some money behind ensuring those opportunities exist.

To some extent, that’s started to happen. Facebook founder Mark Zuckerberg has been stoking speculation about a political run after pledging to visit 30 states in 2017. San Francisco-based Salesforce recently opened an office in Indianapolis, where it plans to hire 800 people. Those gainfully employed workers will earn their paychecks not far from where Carrier will keeping making air conditioners in the US, saving 1,100 jobs. But thanks to President Trump, most American have probably only heard of Carrier.

“We’ve got to do a better job telling each other’s stories,” says Case. That’s one reason why Revolution recently hired JD Vance, author of the bestseller Hillbilly Elegy. After the election, Vance’s book became a kind of guidebook to the rural America that helped vote Trump into office. Vance, himself both a product of a hardscrabble rural upbringing and a principal investor at Peter Thiel’s firm, will help Revolution find and support new companies that further the Rise of the Rest agenda.

Still, reorienting the tech industry’s entire worldview will take more than good storytelling. There is, after all, a reason tech has huddled around Silicon Valley, with its esteemed educational institutions like Stanford churning out a steady stream of capable coders and a venture capital industry that knows how to foster billion-dollar companies. While in theory the internet should make for a mobile tech workforce, the highly skilled workers tech companies need in order to thrive remain concentrated in big cities. Even Baird acknowledges that many of the Rise of the Rest companies are unlikely to deliver the sort of overnight exponential returns that the Valley’s investors are accustomed to getting. Often these companies have found their place in niche industries that just aren’t built to have a billion users. Investors in such companies often need to take a long-term view.

‘Over time, the best-off cities get better and better, and the worse-off lose more people.’

That’s where he says Washington may be able to help. As senator Mark Warner (D-Virgina) noted when he spoke at the summit, the average length of time investors hold a public stock before selling it has dropped precipitously over the last few decades. That makes tech companies more risk averse and less likely to, say, open an office in the middle of Kentucky. “They’re only concerned about that next quarter,” he said, noting that Washington could craft legislation to encourage investors to hold onto their shares longer, which would give companies more room to diversify their investments and let them take root in places where growth might come more slowly but yield more widespread benefits to the economy.

The good news is, especially after the presidential election, politicians are looking for ways to create jobs for people living beyond the coasts. And some in Silicon Valley are waking up to the realization that by expanding beyond their own ultra-pricey borders, they’re not just helping out middle America. They’re helping their own case in Washington.

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Musk’s Tesla makes a bid for Musk’s SolarCity energy company

Electric car company attempts to acquire solar panel seller to create a Silicon Valley one-stop-shop for clean energy for car and home

Elon Musks Tesla electric car company has made an offer to buy Musks solar power company, SolarCity, for as much as $2.8 bn in stock in an attempt to make a one-stop-shop for cleaner energy.

SolarCity, for which Musk is both chairman and its largest shareholder, is the market leader in residential solar panel installings in the US, but has about $6.24 bn in liabilities, including debt.

Musk described the deal as a no-brainer, saying: Instead of building three trips to a house to put in a car charger and solar panels and battery pack, you can integrate that into a single visit. Its an obvious thing to do.

If the bargain goes through, SolarCity will adopt the Tesla brand and sell its solar panel alongside Teslas PowerWall home batteries to store electricity created during the day for when it is needed at night.

Both of the companies, situated 17 miles apart in Silicon Valley, are burning through money as they try to expand in still relatively small markets. Tesla has lost $1.2 bn in the past two years alone while SolarCity has suffered losses outstripping $ 1.1 bn during the same period.

Yet both have fared well in the stock market, especially Tesla, largely thanks to Musk being widely viewed as a visionary since he co-founded online pay service PayPal in 1998.

SolarCity is run by Musks first cousins, the chief executive, Lyndon Rive, and his brother, Peter, who is also a founder of the company and its chief technology officer.

Musk and Lyndon Rive hatched the idea for SolarCity during a trip to the Burning Man desert festival in 2004. More than a decade afterward, SolarCity has become the top US residential solar installer thanks to a no-money-down financing strategy that allows homeowners to pay for their solar panel through a monthly fee that is less than what they would pay their local utility.

Musk and the Rive brethren said they would recuse themselves from the vote on the bargain, as will Antonio Gracias, who is a director of Tesla and sits on the board of SolarCity. Musk owns a 26% stake in Tesla and a 22% stake in SolarCity.

The move comes as Tesla sold over 100,000 of its Model S barroom autoes by the end of 2015, launched its Model X SUV in the US, as well as unveiled its Model 3 aimed at the mass-market with around 400,000 preorders. Tesla has also invested$ 5bn in battery production in partnership with Japans Panasonic for its so-called Gigafactory, which will be needed to bring the cost and scale of battery production into the mass market.

Huge profits in store for firm that they are able make a great leaping in battery technology

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