Latest news with #WorldEaters:HowVentureCapitalIsCannibalizingtheEconomy
Politico
14-03-2025
- Business
- Politico
5 questions for author Catherine Bracy
With help from Alfred Ng Happy Friday, and welcome to The Future in 5 Questions. This week we talk with Catherine Bracy, a civic technologist and CEO of the advocacy group TechEquity whose new book, 'World Eaters: How Venture Capital Is Cannibalizing the Economy,' is getting attention for its provocative argument that the structure of venture capital – the financial engine of the tech industry — has a distorting effect not just on companies and their values, but on American society overall. With Elon Musk currently running a startup-style disruption playbook on the federal government itself, she talks to DFD about the puzzling opacity of private tech giants, how 'moneyball for startups' could improve the economy — and the very disappointing device in her pocket. (You can also hear her on this recent POLITICO Tech podcast.) This interview has been condensed and edited. What is one underrated big idea right now? I would say, something like moneyball for venture capital. Technology itself is valueless, and the thing that gives it its potential to do harm or to create opportunity is the economic structure in which it's created. People should know that the way that investors are incentivizing their companies is to be the biggest they can possibly be, because that's how they create the financial return that they have promised to investors. The playbook for doing that is a bulldozer effect. Speed is goal, not efficiency. I think we see that with the way that Elon is moving — sledgehammer, not scalpel. That's a strategy. It's not a mistake. And all the fallout from that is a cost that is borne by the rest of us. So those companies skirt regulations. They exploit workers. They ship products that aren't good enough or that, you know, have risks to the customer. They do rugpulls. It attracts grifters. I came to believe, by the end of my research, that we were missing out on a ton of great innovation and financial gain by ignoring companies that were only kind of naturally able to hit doubles or triples instead of grand slams. And that in areas like housing and other areas of the economy that I care a lot about, either they were ignoring the right solutions, or they were forcing some of those companies to shape-shift. And that was because the investors are chasing power law returns, I think, to the detriment of the economy. What is a technology that you think is overhyped? Well, that's the thing about VC — everything is overhyped, right? It's like that joke: You can be underwhelmed, or you can be overwhelmed, but you can never be like, appropriately whelmed. And I feel like that's true in VC. Nothing is ever appropriately hyped. But if I'm giving my cheeky answer, I would say I have been really disappointed with the iPhone. I've been an Android girl since day one. I got my first Google phone in 2008, and I've been on Android ever since, and then my friend group shamed me into getting an iPhone so that I would no longer be a green bubble. And I came in thinking this was going to be like, so much better. And it's so much worse. So my spicy take is that the iPhone is really overhyped. What could the government be doing in regard to technology that it is not? I've actually got two answers to this. The first answer is to force more transparency for private capital markets and private companies. I think it's kind of a farce at this stage that companies that are as large and valuable and critical to the financial system as Stripe or OpenAI don't have the same reporting requirements as companies that are much smaller, but in the public markets. And then on the tech policy side, where I do my day job, we're working on a lot of regulation in California to set standards around the deployment and development of AI. A lot of the stuff that we're worried about AI doing in the world is actually already illegal, or there are laws to enforce that behavior, but they're very difficult to enforce when AI is perpetrating them. So we need to properly resource enforcement agencies, empower enforcement agencies and breathe life into them so that there are real, practical methods for people to enforce their rights against AI. What book most shaped your conception of the future? I've been thinking a lot since the election, and about what kind of economic system we will build after whatever this is that we're living through. How do we envision something that is positive about what we can build after? The first thing I did was kind of try to ground myself in history, and so 'The Rise and Fall of the Neoliberal Order,' by Gary Gerstle, has been very helpful in thinking through the grand sweep of how economic systems are created and political economies spring up around them, and what that means for how we got to where we are now, but also what it means for what we might build in the future. And I have found a lot of solace in the very optimistic and heartfelt vision that Natalie Foster laid out in her book 'The Guarantee,' which really points out that, while we think about these things — this sort of utopian idea of what you know, how the abundance economy could work for everybody — there are things we have already accomplished over the last 10 years that point us in the right direction. And then it's not all just fantasy and imagination. What surprised you the most this year? I feel like the cliche answer is the election results. Now, I feel like I shouldn't be surprised by anything. But I've been a little bit surprised by how transparent the Silicon Valley right has been about their goals and methodologies. Elon Musk is nakedly blitz-scaling his way across the federal government, and it's just a very literal interpretation of Silicon Valley's methodology as brought to government. I thought they would be more subtle about that. Maybe I shouldn't have been as surprised as I was. But, you know, here we are. HUAWEI BANNED The Chinese tech giant Huawei's lobbyists are banned from the European Parliament's premises until authorities wrap up a bribery investigation into the company. POLITICO EU's Max Griera reported Friday that Huawei is at the center of a corruption scandal linked to its lobbying in Brussels. The company had nine people registered to enter the European Parliament according to its most recent records in October, and the ban applies to all of the government's premises. Authorities so far have raided 21 addresses in Brussels, Flanders, Wallonia and Portugal, and made several arrests. CALIFORNIA'S PRIVACY COP GETS A NEW CHIEF The California Privacy Protection Agency announced a new executive director: Tom Kemp, a Silicon Valley-based investor who has advocated for the state's privacy regulations in the past. POLITICO's Tyler Katzenberger reported exclusively in today's California Decoded that the tech entrepreneur will lead the agency starting on April 1. He will replace Ashkan Soltani, who left in January. In his Q&A, Kemp said he wants to help Californians exercise their privacy rights, saying there's a disconnect between people worried about their data privacy and people taking action to protect it. POST OF THE DAY THE FUTURE IN 5 LINKS Stay in touch with the whole team: Derek Robertson (drobertson@ Mohar Chatterjee (mchatterjee@ Steve Heuser (sheuser@ Nate Robson (nrobson@ Daniella Cheslow (dcheslow@ and Christine Mui (cmui@
Bloomberg
18-02-2025
- Business
- Bloomberg
Venture Capital Kills ‘More Value Than It Creates,' Author Says
Go Big or go home. Move fast and break things. Winner takes all. In a new book, Catherine Bracy argues that this ethos underpins much of what's wrong with venture capital. In search of grand slam investment opportunities, VC investors choose startups according to what's known as nature's 'power law,' the tendency for outliers to have undue impact—in investing, astronomical returns. (And the vast majority of startups fail miserably.) Despite their oft‑repeated, and much ridiculed, claims to 'make the world a better place,' VCs either avoid addressing societal problems or, in their push for breakneck growth, make them worse, according to World Eaters: How Venture Capital Is Cannibalizing the Economy, out in March. Bracy calls herself a civic technologist. She's the founder and chief executive officer of TechEquity, a nonprofit advocacy group in California focused on the tech industry's impact on housing and workers. (Funders include the Ford and MacArthur foundations, as well as the Chan Zuckerberg Initiative, the philanthropy of Meta Platforms Inc. founder Mark Zuckerberg and his wife, Priscilla Chan.) Bracy, who opened Barack Obama's technology field office in San Francisco during the 2012 presidential election cycle, started TechEquity after seeing the unequal social impact of the tech boom in the Bay Area. She spoke with Bloomberg Television's Sonali Basak in January. Their conversation has been edited for clarity and length.
