Predatory Sexual Harrassment Practices Outed in VC Community

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“[You are a] sorceress casting a spell.” […]comment[ing] on how she looked in a blue dress [he ]added, “Know what I’m thinking? Why am I sending you this — in private? (1)”

A recent article in the New York Times contained some startling allegations made by many women currently working in the tech industry.  It would seem to indicate that rampant sexual harassment is casting a significant pall over the start-up community. Many venture capitalists stand accused of using their position to request a variety of sexual favors from women pitching their companies. These men represent invaluable funding sources that can make or break a start up. It’s a lot of power to wield.

It has been only two years since Ellen Pao lost her bid to level the playing field in her case against VC firm Kleiner Perkins. Perhaps Ms. Pao was ahead of her time in her efforts to gain more acceptance for women in tech.  However, the day of reckoning appears to be on the horizon. Claims of sexual harassment in VC are on the rise.  As more stories surface from women alleging they have been coerced into intimacy in order to obtain funding, other female entrepreneurs become emboldened.  They are refusing to sit quietly by as the future of their fledgling companies is overshadowed by being extorted for sex. Ultimately, we must succeed in putting an end to this practice by speaking out.

Treatment Exposed

With the NYT article, the ugly specter of the pervasive mistreatment of women in the VC community has been exposed. There is mounting evidence to support allegations that men are using positions of power to sexually harass women within their circle of influence.  Female entrepreneurs are being met with “conditions” prior to approval of requests for desperately needed funding. Women in the VC community have raised the issue repeatedly over the last several years. These women allege that the “conditions” imposed on their bids for financing have little to do with credit scores, but instead are merely crude overtures for sex. The Times’ article would indicate that harassment is far more prevalent than previously imagined.  Yet CEO’s and HR departments have alternately dismissed allegations, looked the other way, or worse, joined in, as women were propositioned, harassed and coerced for sexual favors.

“I was getting confused figuring out whether to hire you or hit on you.(2)”

The above statement provides a glimpse of the issues that lay at the root of the problem. The tech culture of Silicon Valley is a culture of youth. It is a also primarily dominated by men. Many of these men have gone straight from fraternity life to the monumental success of a single creative idea. They find themselves going from living in a studio apartment on tacos and beer, to living a life of tremendous wealth. When their own companies are up and running, these entrepreneurs seek to increase their portfolios by supporting the ideas of other like-minded upstarts and disruptors. They go from “frat bro” to venture capitalist, with money to burn. That may explain an immaturity behind the behavior, but it is no excuse for their failure to grasp the concept that soliciting any woman they find attractive is impermissible in a business setting. McClure’s statement suggests that these men are so conditioned to view women as objects, that they sincerely do not know better than to hit on any woman they meet.

“Of course you won. You’re a total babe. (3)”

The imbalance of power that exists in the currently male-dominated corporate structure is further complicated by the fact that these women are first introduced as supplicants for financing. Their need for assistance serves to intensify the tendency of certain men to blur the lines of sexual propriety in the workplace. It may even be the case that these men don’t consider their position before making these advances. Some of these men have seemed surprised when confronted with the women’s responses. Yet nerd-boy or not, they are in positions of power and must act accordingly.

These men hold the power to determine a woman’s entrepreneurial success. They should know better than to bring up intimate personal topics within the context of  conversation surrounding a request for a loan from a female applicant. Regardless of any possible innocence behind the intent, expressing a desire for intimacy in response to a pitch for financing is an obvious taboo.  Such a request uses disproportionate power to extract sexual favors from the recipient. The underlying implication is that to say “no” will result in a refusal of assistance with critical career goals. Women cannot feel they must acquiesce to prevent getting blackballed in the professional community.  This assumption must always color such advances, making them immediately sinister.

The Takeaway

Silence is not golden. In the case of sexual harassment and gender bias in employment, or in business relations in general. Men with money too often use their power to bed female colleagues or co-workers. This behavior is unacceptable, and must be called out whenever it occurs.  Women are not sex objects who exist only to fulfill the lurid fantasies of men in positions of power. Such behavior cannot be tolerated, and the best way to stop it, short of a New York Times exposé, is to file a lawsuit to admonish such behavior.

Should you be experiencing sexual harassment, the team at Lazear Mack is here to help. Remember to document your case as soon as you believe you have been a victim of inappropriate unwanted advances. We can be reached at 510-735-6316, or an intake form may be completed here.

Lazear Mack, LLP
Employment Law Attorneys
436 14th Street, Suite 1117
Oakland, CA

Footnotes:__________
(1) These messages were allegedly sent to Wendy Dent of Cinemmerse, an app for smart watches, by start-up adviser, Marc Canter, during her search for funding  in 2014.. Dent alleges that Mr. Canter (who founded Macromedia in the 1980s) initially agreed to help her, but instead began sending messages that became increasingly sexual in nature.
(2)  This statement is part of a message left on the Facebook page of Sarah Kunst by Dave McClure of 500 Startups shortly after she pitched an idea to 500 Startups. When Ms. Kunst rejected McClure’s advances, she alleges her calls were no longer returned and the company ceased considering the financing of her startup. While ultimately Ms. Kunst managed to start her fitness company, Mr. McClure has since apologized for his behavior and resigned his position with the company.
(3)   Comment allegedly made to Lisa Curtis, of food start-up, Kuli Kuli. She posted the comment on Facebook and got a call from a different investor who told her if she didn’t take down the post, no one in Silicon Valley would ever invest in her ideas. Ms. Curtis says she subsequently deleted the post.

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