SAN FRANCISCO — One technology investor stepped down and two issued public apologies as Silicon Valley’s widening sexual harassment scandal exposed more tales of bad behavior by venture capitalists.
More than two dozen women spoke to the New York Times in recent days about being sexually harassed by tech investors. Ten of the women named the investors involved. One of them, Dave McClure of 500 Startups, gave up his leadership of the firm he co-founded. Another, Chris Sacca, published an apology before the article appeared.
The revelations published Friday came one week after six women accused Binary Capital partner Justin Caldbeck of making unwanted sexual advances in the technology news outlet The Information. Several said the misconduct took place when the women sought funding or guidance on their businesses.
The explosive allegations have brought the venture capital firm Caldbeck co-founded to the brink of collapse and have exposed the broader problem: that men with wealth and influence are using their position to prey on women who are seeking funding and advice to build their careers and companies.
Alleged predatory behavior by a prominent venture capitalist has struck a cord on social media, where women who have come forward have found deep support, suggesting that the cone of silence that once protected perpetrators has cracked, if not shattered.
“I hope the industry continues to support women who speak up and shun men who do these things,” said entrepreneur Sarah Kunst who, when discussing a possible job at 500 Startups in 2014, received a 4 a.m. message from McClure on Twitter that said in part: “I was getting confused figuring out whether to hire you or hit on you.”
On Saturday, McClure posted a blog post entitled, ‘I’m a creep. I’m sorry.’ in which he apologized to Kunst and other women he put “in compromising and inappropriate situations.”
One accusation led to another. After a multimedia pioneer Marc Canter defended his behavior with a female entrepreneur, who accused him of sexual advances when she sought advice, another woman in tech tweeted she wasn’t surprised, since he had propositioned her many times.
Binary fund to wind down
Caldbeck was forced to resign Sunday. A second partner, Matt Mazzeo, also resigned and the third, Jonathan Teo, has offered to resign over “continued questions regarding my behavior,” according to news site Axios. Limited partners have already voted to wind down Binary Capital’s latest $175 million fund.
Two start-ups funded by Binary Capital, Havenly and Dia, have terminated their board relationships. A third, business messaging start-up Assist, has requested to buy back its investment from Binary Capital and end any working relationship with the venture firm.
In the meantime, the venture capital firm is being sued by a former Binary Capital principal, Ann Lai, for harassment and defamation.
On Friday, the New York Times reported that when Caldbeck invested $25,000 in San Francisco entrepreneur Lindsay Meyer’s fitness start-up, she began receiving constant texts from him asking if she was attracted to him. When they met in person, the encounters would gradually get out of hand. He would sit too close, touch her leg, hold her hand and then kiss and grope her.
“As soon as he committed funds, it gave him access to me, and that put me in a difficult position. I had to respond and be available to him,” Meyer told USA TODAY. “When you’re a female entrepreneur, it’s hard to get access to investors and it’s hard to get them to invest in your company. Then you meet a guy who says: This is great. And he understands your business model, starts offering to help you and writes a personal check.”
An investor in Binary, which was notified of his behavior, did nothing — and later apologized for the firm’s inaction in a statement to the newspaper.
‘I use language, I flirt’
When Wendy Dent, 43, sought business advice for her smartwatch app Cinemmerse from start-up adviser Canter, she says the tone of his correspondence took on an increasingly sexual nature.
When they met at a cafe to discuss her start-up in 2015, Canter praised the idea and offered to be her adviser, Dent says. Then, within minutes, he said: “You are spectacularly beautiful. Distractingly beautiful.”
Over the next few weeks, Canter’s messages became more provocative, Dent says. In one message, obtained by USA TODAY, he wrote, “To quote a wise woman ‘what’s in it – for me?’ I apologize that our meeting got cut short. That’s the downside of flying by the ‘seat of your pants.'”
In another, he referred to Dent as a “sorceress casting a spell.” “You (sic) image is haunting my psyche,” he wrote later that day.
Canter, 60, who founded what is now Macromedia, denies he ever agreed to help Dent and says he didn’t like her idea.
“At no time did I have any expectations to sleep with that woman,” Canter says. “I use language, I flirt, I try to cut through bullshit. That’s my style.”
“If I flirted with her, it was to drive her away – and it worked,” says Canter, a self-described “old, fat” feminist. “(Dent) used her sexuality to get attention and hey, it worked. She got plenty of press coverage.”
After Canter’s initial comments in the Times, a second woman — Danah Boyd, a principal researcher at Microsoft Research, tweeted, “Horrified but not surprised by Marc Canter’s justification of his sexual harassment. He propositioned me for a threesome many times.” She wrote, “Didn’t matter how many times I said no or how awkward it was.” (Canter vehemently denied Boyd’s claims, calling it a “witch hunt.”)
Dent says she wasn’t seeking attention or fame.
“Sexual harassment is not about sex, it’s about power,” she says. “Advisers and VCs have so much leverage, and push women against the wall because of that power imbalance.”
‘This behavior isn’t normal’
That realization seemed to be sinking in Friday.
At a mostly male tech gathering in Las Vegas in 2009, entrepreneur and investor Susan Wu said Sacca, a prominent tech executive, touched her face in a way that made her uncomfortable. She spoke with the Times, who asked Sacca for comment. He responded with a blog post.
“As more and more brave women have come forward to share their own tales and experiences from the hostile environment of the tech world, it has become clear to me there is a much bigger underlying issue in this industry,” Sacca wrote, “and I am realizing at times I was a part of that.”
Rachel Renock, CEO of Wethos, told the New York Times she encountered sexist remarks when raising money for her online community site in March. She and her female partners endured the remarks because they “couldn’t imagine a world in which that $500,000 wasn’t on the table anymore.” Wethos ended up raising the money from another investor.
“The reason I came forward is to let other female founders know that this behavior isn’t normal, you don’t have to take it, and that there are plenty of good-hearted people out there who will take you seriously, and you deserve to be taken seriously,” Renock told USA TODAY.
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