venture capital

A Silicon Valley kingmaker wants to fix what tech did to California

The conscience of liberal venture capitalist Sam Altman.

venture capital

Sam Altman is launching ‘The United Slate’

The venture capitalist plans to help candidates build tech and use targeted ads to win elections.
Altman's 10 policy goals attempt to tackle inequality, education, housing and transit.
It all starts in California.
venture capital

A Silicon Valley kingmaker wants to fix what tech did to California

The conscience of liberal venture capitalist Sam Altman.

Sam Altman, 32, is sitting here in a Y Combinator conference room in San Francisco wearing a blue striped shirt and jeans, both knees pulled up to his chest and his shoes on the chair. One arm is wrapped around his left leg, showing off his zebra print Yeezys.

Altman, the president of Y Combinator — Silicon Valley’s most prestigious startup incubator — pulled out his iPhone to walk me through the 10 policy goals of The United Slate, his new political advocacy project aimed at introducing new political candidates at the state and federal level. It’s “basically an effort to find five-ish candidates to run in California in 2018 on the same set of policies,” Altman said.

Through Y Combinator, Altman funds technology startups and provides mentorship to its founders. Y Combinator's success stories include Dropbox, Airbnb, and Twitch, and it claims the combined valuation of its companies exceeds $80 billion. The acceleration of these companies contributed to rising living costs in the Bay Area, which is rapidly dividing into two classes of techie haves and non-techie have nots. Therefore, Altman seems to have a sense of responsibility — guilt? noblesse oblige? — when it comes to tackling inequality in the region. This led to his passion project, The United Slate.

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Altman, like many liberal Bay Area techies including Mark Zuckerberg, was shaken by the election of Donald Trump. After November 9, Altman went soul searching. He took a tour of the country and California, interviewing 100 Trump supporters and publishing his findings. He vocally criticized Trump, but at the same time, he refused to cut ties with friend and billionaire Trump surrogate Peter Thiel, who works as a part-time partner at Y Combinator.

This was the beginning of Altman’s poking into politics. In the kitchen where catered lunch is being served to Y Combinator employees, Altman explained that the cost of housing is one of the biggest problems in California. Leading me into the conference room, he told me it’s something he’d “really like to fix.” The cost of housing has skyrocketed not just in San Francisco where the rise of multi-billion dollar technology companies has driven lower income people out, but in all of California. In January 2012 in Southern California the median home price was $260,000. Today it is half a million dollars.

“One thing I can help with is, just, building really good software to help people run really great online campaigns,” he said. “I think that’s been terrible.”

Just earlier this year, Altman himself was mulling a run for governor, and he’s certainly thinking about what he’d do if he were Governor. “So like, personally, if I were Governor,” Altman told me, “I would not do the bullet train, and I would take that hundred billion dollars and I would spend it all on local rapid transit.” Altman is talking about the multi-billion dollar California High Speed Rail train that will connect San Francisco and Los Angeles. “This is another thing we heard from regular people, they don't actually need to go from SF to LA every weekend, but they would really like it if they don’t have to spend 95 minutes in traffic every day, each way.”

So: how does Altman get people to vote for these candidates? For him, it all comes back to building better tech. “One thing I can help with is, just, building really good software to help people run really great online campaigns,” he said. “I think that’s been terrible.”

When I brought up the fact that Trump and Cambridge Analytica, the online data firm working on behalf of the Trump campaign, seemed to have done a pretty good job online campaigning, he demurred. “He did pretty good, but I think the sad thing about Trump is I think he just mostly won on message,” he said. “I don’t think he was individually targeting people. I think the era of everyone seeing the same ad for anything is over, and, you know, there’s a lot of people who are really great at targeted online marketing, but not politicians.”

As for cash, The United Slate isn’t set up as a PAC. It’s more of a branding exercise than a fundraising one, and candidates will run their own campaigns and raise their own funds. Hundreds of candidates have reached out to him expressing their interest in running with The United Slate, he said. The platform encompasses disparate goals, but overall, it’s aimed at reducing inequality: its three guiding principles are personal liberty, prosperity from technology, and economic fairness.

Portions of our interview with Sam Altman are on our daily podcast, The Outline World Dispatch. Subscribe on Apple Podcasts or wherever you listen.

One of his proposals is Medicare for All, where Altman proposes dropping the age of Medicare availability over time. Another point of the platform is expanding social programs, where Altman suggests researching Universal Basic Income. (Y Combinator has already begun work on a UBI project in Oakland.) “We should set a goal of eliminating poverty in the country,” Altman writes on his website. “I’m not yet sure what a reasonable timeframe for this goal is, but I do feel a moral obligation to figure out how to do it.” Unions aren’t working, Altman says, and wages are stagnant, so we need something better, even though he isn’t sure what that is yet.

The one Altman cares about the most, he tells me, is government investment in research and development. “Like, right now we’re set up to fight World War II again, very unlikely that’s what we need to be really good at, and we should really be investing hard in biotechnology, artificial intelligence, cybersecurity.” So Altman has proposed shifting 10 percent of the annual defense budget into “the research and development of future technologies.”

There’s also a clean energy target of 90 percent by 2050; Altman says we should get rid of the clean energy subsidies and just impose a carbon tax. His plan includes an increased tax rate for capital gains, calls for an end to corporate tax shelters, and a tax on land ownership, which Altman sees as the fundamental way wealth inequality builds up over time.

It’s hard to pin down where exactly Altman lies on the political spectrum. He’s decidedly on the left, and has gone so far as to compare Trump to Hitler. He also breaks with Silicon Valley libertarianism by wanting a requirement that the children of California representatives must go to public school. Altman went to a “not great” public school, he explains, “and I think if the people that are setting the rules don't feel that, they won't fix it.”

A lot of Altman's ideas are broad and vague, he’s not really sure at what rate he’d like the Medicare eligibility rate to drop for example, but that’s probably the point. He’s trying to find candidates that identify with these ideals, and the details can get worked out later.

“A democracy needs everyone's lives to get better every year, and I think prosperity is how we do that,” Altman explains. “We have this prosperity machine in the U.S., we've created huge amount of wealth and its not distributed very well.” Does that everyone include people who are already rich? “Yeah, people who are already rich too,” Altman says.

The United Slate is just three people: Altman; Matt Krisiloff, who works as the Director of Research at Y Combinator; and his brother Scott Krisiloff, a mutual fund manager, who are helping conduct focus groups around California. Altman isn’t trying to build some big operation he warns, he’s simply interested to see if he can advance the political wish list he’s dreamed up.

“What I hope more than anything else is that if there’s a group of people running together, and they say ‘Hey, all five of us we’re running as a slate and here’s this new set of things we believe, if you want this vote for us all.’ No one has tried that in a while, but I hope there will be this network effect.”

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