WHAT IS THIS ALL ABOUT?:
We are the constituents of Nancy Pelosi and
Jared Huffman.
Campaign billionaires
(John Doerr, Elon Musk, Eric Schmidt, Steve Jurvetson, etc,) paid
bribes in order to get tax credits, rigged government contracts,
free real estate, free labor, stock market valuation manipulations,
IRS waivers, SEC avoidance, commodity market rigging and monopoly
arrangements. They are now under investigation, by multiple law
enforcement entities, but that doesn't help us!
We
witnessed these crimes and reported them, at the request of federal
officers.
For our troubles, we had
revenge and retribution attacks placed on us by public elected
officials.
We have had hacking,
character assassination, blacklisting, threats and other forms of
political revenge fired at us by political operatives. The finances
and directions, for those attacks, have now been financially,
operationally and forensically traced back to
specific politicians and their campaign billionaires. At least
three people, that we know of, have been killed. At least two of us
were poisoned by toxic heavy metal poisoning. The attacks against us
are increasing because... Elections!
We
reported this to every State and Federal law enforcement agency,
that we knew of, and filed lawsuits, but the journalists tell us the
investigations and lawsuits are being subjected to lies,
stone-walling, document shredding, "missing hard drives",
delay tactics, obfuscation, cover-ups and manipulation. Over 15
Senate and public investigations, into this, have been stonewalled.
Over 20 top Washington officials have quit over this. This is a very
real, very documented matter but we do not have time to wait for the
long, drawn out final conclusion. We need results today!
We
have hired ex-CIA, Ex-FBI, private investigators, researchers,
forensic lawyers and specialists to help with this. Parts of the
U.S. Congress, top journalists and other key people, support our
cause. Additionally, over 300 million taxpaying voters think these
corrupt politicians simply "suck"! There are
enough people, on our side, to get every take-down
completed, if we need to go that far.
If
you bad guys want to keep the fight going: "BRING IT!" You
will lose your campaigns, your assets, your party, your tax
shelters, your family trusts, your 501 C 3's + 4's, your PAC's, your
parties and your stock holdings!
If you
want to settle this, we are waiting for your call!
We
are DEMANDING that Jared Huffman and Nancy Pelosi, as required by
law and policy, take action to help us by ending these attacks and
recovering our damages, now!. We are documenting all of the actions
that they do take, and don't take,
delays, stone-walls, solutions, etc. to the World, Law Enforcement
and Investigative Reporters globally using torrents, blogs, email
lists, listserves, Tweets, social pages, Drawstrings and other
technologies.
We have worked in, and
with, Washington DC. We know where "the bodies are buried",
the tricks, the tactics and who knows what. Don't screw around any
more. Fix this!
Nancy & Jared:
Organized crime is still a "bad thing", right?
Nancy
& Jared: END THE BLOW OFF!
Nancy & Jared: You can end
this with two phone calls. Make the calls!
Nancy
& Jared: Some of us were Democrats, before your DNC partners
F*cked Them In the As* with their little crime kick-back scheme. Are
you like them, or do you have a shred of morality
left?
http://endtheblowoff.weebly.com
NOTE: At this time, we are not saying that Nancy and Jared, specifically, are crooks. We will base our future comments, about them, on the actions they take in resolving this matter!
USING THEIR OWN "LOOP
HOLE LAWS" AGAINST THEM:
In order to rob
taxpayers, steal their money, manipulate public policy for personal
profit and "rig the game", as Elizabeth Warren says; these
dirty politicians create "loop hole laws". Loop hole laws
are fake laws that only help themselves, and hurt every
American.
We have found that teams of citizens can wipe
out even the most billionaire-backed, wealthiest, corrupt
politicians on Earth. They can do it using the law. We can turn
their crooked laws against them. As far as they stretch the law to
do crimes, you can use those same laws to do
good deeds, and shut them down.
Unlike
the corrupt politicians, we will never break the law, and we WILL
use the law to take them out if they don't solve this problem! We
will also use elections, the media, social networks and community
alliances.
Our "dead-man switches"
are "awesome"; according to one well-known reporter.
The
public can now use all of their power and resources to take out the
kick-backs, PACS, family trusts, investor portfolios, off-shore tax
havens, hookers, credit card expense frauds, junkets, campaign
financiers investor pools, kick-back stock warrants, tech
company holdings of corrupt billionaires, and other secret scams,
and wipe out the political legacy of any criminal politician. The
public now has their own X-Key-Score!
Ready
to ride?
Together, you can create a
tornado!
THE
END OF WASHINGTON CORRUPTION
BACKGROUND
ARTICLES & NEWS COVERAGE:
Over
100,000 news articles have been published about this incident -
Dear President Obama:
You
are familiar with the fact that your staff, including, Mr. Emanual,
Plouffe, Daly, Strickland, Holder, Chu, Gibbs, Axelrod, Carny,
McDonough, Rattner, and others, all of whom, suddenly, quit their
federal jobs, when exposed, did a bad thing.
They
arranged with campaign financiers, including Mr. Musk, Westly,
Jurvetson, Schmidt, Doerr, and others, to exchange government
contracts, tax waivers, grants, stock valuation increases, stock
holding assets and tax credits for campaign support.
This
has come to be known as the “CleanTech Scandal”. It has been
deeply documented in numerous lawsuits; the 60 Minutes Episode
called: “The CleanTech Crash”; Many published GAO
investigations; the in-progress FBI case which began with the FBI
Solyndra raid; Over 100,000 news stories which deal with the
following keywords: “Corruption, steven chu, department of energy
Solyndra”; U.S. Senate ethics investigation documents, and
thousands of other published, and broadcast materials. In fact,
there is now, so much published evidence, proving that this scandal
took place, that it is impossible to deny. There are now millions of
pages of evidence, and hours of recordings that provide irrefutable
proof.
To date, federal, and news, investigators have
documented over a “trillion dollars in losses to taxpayers” from
this incident.
We are the victims of this scandal. We are
the companies, and individuals, that your Administration invited
into the program, so it would look good, in the beginning. Your
staff, knew, though, from Day One, that the money had already been
set-aside for Mr. Musk, Westly, Jurvetson, Schmidt, Doerr, and
others. The money was hard-wired, ahead of time. All of our time and
money, spent at the request of your people, was worthless, and your
people knew it, and lied to our faces.
While your people
knew it all along, we sure hope you didn’t know it. That would
just be a very sad situation for The Nation.
So all of us
were lied to, and forced to spend our time and money on a federal
program that we were never going to be allowed to help with. Bright
Automotive, Aptera, Brammo, Zap, XPV, and all of the rest, were just
being used as a cover for a game that was already rigged.
You
owe us our expenses for the damages your people cost us because of
those lies and abuses.
As if that wasn’t bad enough,
when we cooperated with federal investigators, who were looking into
these abuses of taxpayer resources, your people put hit-jobs on us.
Your offices, and campaign financiers, ordered their associates:
Media Matters, Gawker Media, In-Q-Tel, New America Foundation, Think
Progress, Google, and others, to attack us. Your people tried to
wipe us out, in retribution for helping the cops. The attacks were
ten times worse than the whole “Lois Lerner”- type
attacks.
That was pretty unkind.
You owe us
for the losses suffered from these character assassination and
employment database attacks. Your people made sure all of us could
not work again. We plan to use our free time to prevent these kinds
of abuses, starting with the 2016 elections.
On top of
all that, you, personally, owe us an apology.
These were
your people, on your watch. The buck stops at the Oval Office.
We
look forward to your phone call. DOJ has our
numbers.
Sincerely,
The Victims, and their
families, from the “Cleantech Crash”
WHO KILLED GARY D. CONLEY, ASK HIS RELATIVES AND FRIENDS?
(Hornet's Nest will provide all copies of all of the "really juicy" evidence to credentialed journalists today, and the entire world if this does not get settled very soon!)
McKinsey was paid by the Cartel to flood Washington DC with BS "White Papers" that steered all laws to Kleiner Perkins
WANT MORE PROOF? WE CAN PROVIDE MILLIONS OF PAGES OF EVIDENCE...BUT... YOU SENATORS HAVE ALREADY SEEN ALL OF IT, ALREADY. FIX THIS NOW! PAY OUR DAMAGES AND SEND US THE APOLOGY LETTER!... |
Whistle-Blowers
|
While this recent news item appears to have been
authored with a bit of tongue-in-cheek, it fully, and accurately,
describes what took place:
“The
U.S. Department of Energy (DOE) Corruption and Racketeering
Organized Crime Payback Program for Campaign Financiers Calls for
More Kick Back Deals
PRESS
RELEASE – WASHINGTON, DC- ### The U.S. Department of Energy
(DOE) supports campaign financiers, mostly from Silicon Valley, who
want to monopolize advanced technology vehicles (ATV) and associated
components through its Advanced Technology Vehicle Manufacturing
(ATVM) Loan Program administered by the agency's Loan Programs
Office (LPO. ATVM is a direct loan program established pursuant to
Section 136 of the Energy Independence and Security Act of 2007 so
that certain politicians have the biggest slush fund ever
created.
Under the ATVM Program, Kleiner
Perkin’s, and the Silicon Valley Cartel campaign financiers for
the Obama, Reid and Feinstein campaigns, who suddenly decide they
are automobile manufacturers, or advanced vehicle automobile
component manufacturers, are eligible to obtain give-away free
direct taxpayer cash, from DOE, for projects that the “SAY” will
reequip, expand, or establish manufacturing facilities in the United
States that greenwash a load of BS about saying they will produce
"ultra-efficient vehicles," passenger automobiles, light
duty trucks, or associated components that meet DOE's emission and
fuel economy standards for "advanced technology vehicles",
When, in fact, they are just using those statements to befuddle
taxpayers as a cover-story to get tax credits and kickbacks from the
White House.
To date, DOE has funded five of
their friend’s loans under the ATVM program totalling $8.4
billion, approximately one third of its $25 million loan authority.
To prove the corruption, DOE kicked out every single applicant that
competed with the campaign financiers stock portfolios.
The
ATVM Program is not subject to an expiration date, and despite
previous Congressional efforts to rescind ATVM's funding, because it
is the most corrupt program in the history of America, the program
and its remaining $16.6 billion in loan authority is being actively
promoted for new kick-back programs, to pay for Hillary’s
campaign, by the DOE and LPO leadership and staff. DOE staff feel
that “Those Republican pigs tried to shut the DOE scam down, but
we, at DOE, said “Screw You” and just kept on doing it because
Holder was covering our butts”.
ATVM is
pretending to “actively solicit quality applications” from
anybody, when in fact they plan to, as usual, reject anybody who is
not a campaign financier, or funded by one. Program officials are
vocal in promoting the use of DOE's capital for industry scale-up
and improvement projects exclusively for their campaign
moneybags.
For campaign investors, particularly
John Doerr, seeking to expand materials, component, or manufacturing
lines, ATVM offers an attractive opportunity for low-interest
capital, with less fees than other DOE loan programs, and a
precedent for both high-value loans and the program office's
willingness to interpret its legislative mandate as broadly as
possible (e.g. loans in support of companies beyond established
automakers, such as Tesla and Fisker, clearly prove that 100% of the
cash gets kicked back to those who pay for our bosses political
campaigns and give our families stock in their Cartel operations).
This is the very program that funded the Obama campaign and it will,
again be the very program to fund the next President.
In
addition to meeting technology and commercial eligibility criteria,
each applicant must be determined, by the White House controlled
DOE, to be a favoured campaign financier, without receipt of
additional federal scrutiny associated with the proposed project.
Specifically, these rigorous terms specify that the principal amount
of the loan may not exceed 80 percent of reasonably anticipated
total project costs (But we never check), and the term of the loan
may not exceed the lesser of the projected life of the proposed
project or 25 years, but we always fudge the numbers, and manipulate
the applications, with financial hyperbole and bullsh*t, if you are
a campaign financier, so you will get in, and your competitors will
get sabotaged.
Solyndra was one of our biggest
corruption disasters. With Vehicle Production Group's and Fisker
Automotive's loans auctioned off following defaults, because our
partners: Goldman Sachs and Richard Blum had already skimmed their
fees off the top, the loans from Ford and Nissan in the process of
repayment, and Tesla's loan fraudulently “paid back” (Except
they didn’t and then we gave Musk billions more to pass back to
the White House), ATVM has a pathetic record across its five loan
portfolio but a less than 2% default rate by dollar value. We
are proud to have created the greatest taxpayer loss in U.S. history
by destroying more domestic companies, in the shortest time-span, by
spending the largest amount of taxpayer dollars, on kick-backs, than
any other agency has ever had the audacity to do. F*cking Issa still
hasn’t rattled our cage!
Accordingly, we
expect the program to continue to push cash to our payola buddies
John Doerr, Elon Musk, Eric Schmidt, Steve Jurvetson and Goldman
Sachs, as those are our priorities. Things such as strategic and
creditworthy partnerships, on the part of applicants, are never
considered if you pay to get Google to steer all the search results
to elect Hillary; advanced vehicle technologies in the consumer
vehicle category (under 8,500 pounds) rather than fleet or
commercial vehicles are not relevant; and a strong focus on electric
vehicle technology so that the public won’t pay too much attention
to our scam (e.g. advanced lithium battery components which we all
own the monopoly controlling stock interest in, charging
infrastructure, and vehicle lightweighting to offset heavy battery
systems).
In March 2015, the Department of
Energy announced a conditional commitment for a $259 million loan to
Alcoa Inc because the world’s largest metal factory was so broke.
They had already spent the money and we owed them so much
quid-pro-quo to pay for Obama’s bus. The conditional commitment is
the first issued by the Department under the ATVM loan program since
Secretary Moniz (Known as Steven Chu 2.0) announced a number of
oversight reduction improvements to the program in 2014, and is the
first step toward issuing a final loan to Alcoa. If finalized, the
loan would support the company's Alcoa, Tennessee, manufacturing
facility, where the company will produce high-strength aluminium for
North American automakers to lightweight their vehicles because
Alcoa executives ONLY can afford two private jets apiece. This jet
inequality is horrific in a day and age where Eric Schmidt and John
Doerr have all the Gulfstreams’s, and private NASA airfields we
can give them.
Unlike the DOE's Title XVII Loan
Guarantee Program, the ATVM Program is not subject to an expiration
date, application fees, or excessive diligence (We can just hand out
taxpayer cash, to our friends, like it is water) and project
negotiation fees. Indeed, with ATVM, the DOE covers both the credit
subsidy costs and its own counsel fees because you Silicon Valley
types are spending billions on mood manipulation and search engine
rigging to make sure our guys get elected). While private financing
is not broadly available because the Silicon Valley Cartel controls
it, via their Cartel and the NVCA Cartel that they own, and
blacklists competitors, and we give DOE cash to our VC buddies at
attractive, comparable rates exclusive to Silicon Valley VC’s who
only get low-interest federal loans, automotive and automotive
components; materials for vehicles, engines, batteries, and
electronics; and integrated new vehicle technologies remain
challenging to finance at a rate comparable to this program from us.
Taken together, these factors make this program the most attractive
government Corruption and Racketeering Organized Crime Payback
Program financing available in history.
For More
Information, Contact Secretary Moniz at the U.S. Department of
Energy Headquarters in Washington, DC.”
OVER ONE MILLION PAGES OF EVIDENTIAL EVIDENCE DOCUMENTS, NOW ON FILE WITH FEDERAL COURTS, STATE AND FEDERAL LAW ENFORCEMENT AGENCIES AND NATIONAL JOURNALISTS, PROVE, BEYOND A SHADOW OF A DOUBT, THAT ORGANIZED CRIME ACTIVITIES WERE CONDUCTED WITH TAXPAYER DOLLARS INSIDE OF FEDERAL OFFICES BY FEDERAL EMPLOYEES
WHY POLITICIANS DO REVENGE, RETRIBUTION, ECONOMIC MURDER AND CHARACTER ASSASSINATION TO KEEP THEIR KICKBACKS FROM BILLIONAIRES:
Here is a small sample of
a quite vast set of evidence that exists to prove that they do this.
Please blog additional reports of such actions in all of the blogs
and social media postings you can.
Articles from
across the
web:
************************************************
So
A Blogger Walks Into A Bar…
By Michael
Arrington
Yesterday I was tipped off about a
“secret meeting” between a group of “Super Angels” being
held at Bin 38, a restaurant and bar in San Francisco. “Do not
come, you will not be welcome,” I was told.
So I
did what any self respecting blogger would do – I drove over to
Bin 38, parked my car and walked in. In the back of the restaurant
in a private room was a long oval table. Sitting around the table,
Godfather style, were ten or so of the highest profile angel
investors in Silicon Valley. These investors, known as “super
angels” because they have mostly moved on to launch small venture
funds of their own, are all friends of mine. I knew each person in
the room very, very well.
I certainly didn’t
think anything was amiss and I expected a friendly hello and an
invitation to sit down for a drink or two before being shooed off
while they talked about whatever they thought should be kept off
record. But instead it went something like this:
Me:
Hey!
Person who was talking: oh, oh no.
Me:
Hi. I heard you guys were here and I wanted to stop by and say
hi.
Them: dead silence.
Me: so….
Them:
Deafening silence.
Me: This is usually where you guys say
“sit down, have a drink.”
Them: not one sound
Me:
This is awkward. I guess I’ll be leaving now.
I’ve
never seen a more guilty looking group of people. But that alone
isn’t that big of a deal. Lively conversations often die
quickly when I arrive, and I’ve learned not to take it personally.
But I did sniff around a little afterwards, and have spoken to three
people who were at that meeting. And that’s where things got
interesting.
This group of investors, which
together account for nearly 100% of early stage startup deals in
Silicon Valley, have been meeting regularly to compare notes. Early
on it was mostly to complain about a variety of things. But the
conversation has evolved to the point where these super angels are
actually colluding (and I don’t use that word lightly) to solve a
number of problems, say multiple sources who are part of the group
and were at the dinner. According to these souces, the ongoing
agenda includes:
Complaints about Y Combinator’s
growing power, and how to counteract competitiveness in Y Combinator
deals
Complaints about rising deal valuations and they can act
as a group to reduce those valuations
How the group can act
together to keep traditional venture capitalists out of deals
entirely
How the group can act together to keep out new angel
investors invading the market and driving up valuations.
More
mundane things, like agreeing as a group not to accept convertible
notes in deals (an entrepreneur-friendly type of deal).
One
source has also said that there is a wiki of some sort that the
group has that explicitly talks about how the group should act as
one to keep deal valuations down.
At least two
people attending were extremely uneasy about the meetings, and have
said that they are only there to gather information, not
participate.
So what’s wrong with
this?
Collusion and price fixing, that’s what. It
is absolutely unlawful for competitors to act together to keep other
competitors out of the market, or to discuss ways to keep prices
under control. And that appears to be exactly what this group is
doing.
This isn’t minor league stuff. We’re
talking about federal crimes and civil prosecutions if in fact
that’s what they’re doing. I had a quick call with an attorney
this morning, and he confirmed that these types of meetings are
exactly what these laws were designed to prevent.
I’m
not going to say who was at the meeting since at least a couple of
the attendees are saying they were extremely uncomfortable with the
direction the conversation was going. But like I said, it included
just about every major angel investor in Silicon Valley.
On
a side note, this is a difficult post to write, because I call
nearly every person in that room a friend. But these actions are so
completely inappropriate it has to be called
out.
**************************************
Not
sure what your sources are, but courts have ruled that parallel
action can be sufficient evidence of conspiracy under Section 2 of
the Sherman Act. See e.g. American Tobacco v. United States (1946),
available
here:
http://supreme.vlex.com/vid/american-tobacco-v-united-states…
The
Supreme Court wrote: “[The conspiracy's] existence was
established, not through the presentation of a formal written
agreement, but
through the evidence of widespread
and effective conduct on the part of petitioners in relation to
their existing or potential competitors.”
If I
remember correctly from my anti-trust class last year, the American
Tobacco precedent still stands. You don’t need written or audio
evidence to get a conviction; anti-competitive behavior in the
marketplace is
sufficient.
*****************************
dandelany
774 days ago | link
Interesting questions… IANAL,
but I imagine they’re colluding to bring down the valuations of
startups, therefore essentially fixing the “price” of their
money, to be paid for in startup equity. If I, and others, say your
company is worth a million dollars, then I’m fixing the price of
my $500,000 at 50% of
your
company.
*****************************
blueben
774 days ago | link
“Look, you and I both know
your company is worth $50 million. But I only want to pay $10
million, and I’ve already worked out a deal with my competitors so
they won’t bid any more than that either. We own the market for
investment, so you can take it or your company can die for lack of
funding.”
You don’t see a problem with this kind of
artificial market manipulation? This is no longer a market; it short
circuits true capitalism and only serves to siphon gains from the
seller (in this case, the company’s founders) to the buyer, who
will turn around and effectively try to resell (or otherwise exit)
the company for profit. Everyone seems to be convinced that
price fixing only applies to sellers. That’s wrong. It firmly
applies to both selling and buying. It’s fundamentally about
market manipulation; taking steps to undermine the economy of the
system for direct personal gain. That kind of behavior destroys
wealth and erodes confidence in the
marketplace.
*************************************
grellas
774 days ago | link
That comment was made out of
ignorance. Antitrust laws are by no means limited to sellers
only.
*************************************
SkyMarshal
774 days ago | link
Interesting,
thanks.
***************************************
invisible
774 days ago | link
I know this was pointed at
grellas, but I think this is a misunderstanding when we look at
price fixing and
collusion. The illegality of
collusion is secretly forming agreements to benefit competitors at
the expense of
other parties. Words like defraud
can succinctly help you understand whether it is illegal or not when
looking at
these
agreements.
*******************************************
dctoedt
774 days ago | link
The Wikipedia summary of
Section 1 of the Sherman Act is a decent
read:
http://en.wikipedia.org/wiki/Sherman_Antitrust_Act#Violation…
*********************************************
jon_dahl
774 days ago | link
Grellas, would there have to be
evidence that the participants were acting anti-competitively, or is
being in the
room enough? Arrington says that a few
of the folks there were uncomfortable with what was going on, and
were
maybe there just to see what was
happening.
********************************************
grellas
774 days ago | link
Assuming the meeting had an
illegal purpose (which is a major assumption at this point), one
might infer that
anyone present was complicit in
that illegal purpose. In my view, that by itself would not normally
be enough to
subject someone to liability,
especially if the participant disclaims affiliation with the group
and thereafter
does not act in concert with
it.
*****************************************
From
the ATVMDOE WIKI:
Did Venture Capital groups run a cartel
to try to control the energy and new auto industry?
Posted
on October 29, 2012
The venture capitalists are from the
same few schools, are males with similar appearances and only fund
companies with senior staff from the same schools and with similar
appearances and fraternity connections. They put their offices on
the same road: Sandhill Road. If you, or your team did not go to
Stanford, it is not likely you will get funded by them.
They
meet at Bucks restaurant in Woodside (now recorded by Iphone
carrying entrepreneurs and posted on YouTube) and in conference
rooms on Sandhill road and decide which companies to blockade and
which companies to let through. Isn’t that a monopoly? Isn’t
that against the law? These people should be prosecuted under the
Sherman, FTC and RICO
Acts!
*****************************************
grellas
774 days ago | link
It is not required that the
participants have monopoly power for them to transgress the law on
this point. I agree
with you that the “nearly
100% of the early stage deals in Silicon Valley” statement is
wildly overstated but this
should not affect the
fundamental legal analysis
here.
*********************************************
tc
774 days ago | link
Congratulations to PG &
company. When I first met Paul years ago, he was musing about spam
filters and the finer
points of a well-designed
lisp. Now he apparently has the top 10 angels in Silicon Valley
running scared of
him.
*******************************************
jeromec
774 days ago | link
The interesting thing is unlike
that group of Angels apparently in the bar PG’s interests are less
about helping
himself, and more about helping
entrepreneurs. From an essay by PG entitled “Why YC”:
The
real reason we started Y Combinator is one probably only a hacker
would understand. We did it because it seems
such a
great hack. There are thousands of smart people who could start
companies and don’t, and with a relatively
small
amount of force applied at just the right place, we can spring on
the world a stream of new startups that
might
otherwise not have existed.
In a way this is
virtuous, because I think startups are a good thing. But really what
motivates us is the
completely amoral desire that
would motivate any hacker who looked at some complex device and
realized that with a
tiny tweak he could make it
run more efficiently. In this case, the device is the world’s
economy, which
fortunately happens to be open
source.
http://paulgraham.com/whyyc.html
*******************************************
wensing
774 days ago | link
YC’s greatest hack is
identifying founder material based on technical rather than social
proof (the YC app asks
for an example of the
coolest thing you’ve ever built, not an example of a cool person
that thinks you are cool).
This hack is possible
thanks to a judges panel full of real nerds. How many super angels
or VC’s can claim to have
the
same?
**************************************
gruseom
774 days ago | link
I agree that YC are able to
identify great hackers and great founders more easily because they
are these things
themselves. What’s little
recognized is how big a difference this is between YC and the other
YC-like
funds.
******************************************
brendonjason
774 days ago | link
Yes. They are running scared of
the growing threat of the Ylluminati. But since they have 100% of
all the deals,
they also seem to
co-invest(?!?).
These anxious (yet all-powerful)
group of angels and this unstoppable new seed-stage prominence. They
form a
closed loop. A loop closed off to venture
capitalists and angels not at that meeting … which is
basically
everybody.
Except
Michael. He got away with his life intact and lived to warn us
all.
Actually, I don’t know what’s scarier –
the supposed collusion or the subtle dread that Y Combinator is
supposed
to evoke in my mind as I ponder the
possibility of this event being true.
If it is true
– maybe we should be side with these poor angels and help them
before it’s too late.
To paraphrase Woodrow
Wilson, “Since I entered (angel investing), I have chiefly had
(angel investor’s) views
confided to me
privately. Some of the biggest men in the (Valley), in the Field of
(IT) and (Venture Capital), are
afraid of
something. They know that there is a power somewhere so organized,
so subtle, so watchful, so
interlocked, so
complete, so pervasive, that they better not speak above their
breath when they speak in
condemnation of
it.”
That something … is Y Combinator.
Um
… no. The dark side doesn’t suit you, Y Combinator.
Please
stop.
I’m sorry. Maybe I’ve had too many beers
tonight. But this is the kind of scenario that only comes out of the
mind
of a silicon valley PR firm.
(please
don’t downvote me too much … I’d like to get above 100 karma
points just once for a change!
Noooo!)
****************************************
mattmaroon
774 days ago | link
This goes well beyond
sensationalism. I’m inclined to believe him for three
reasons:
1. Mike’s not known for boldly lying. He
might publish rumors that Facebook is building a phone too
liberally, but
I’ve not heard of him saying “I
saw x happen” and it wasn’t true. Assuming the account of what
he himself saw was
accurate it’s hard to imagine
collusion wouldn’t be the purpose.
2. This sounds
like something that would happen. VCs do this crap all the time, why
not angels?
3. Publishing this might be bad for
him, and if it were untrue, it would definitely be really bad for
him.
*********************************
cletus
774 days ago | link
I believe it too. You
succinctly enumerate the reasons. The biggest for me was that (he
claims) he saw it happen.
That puts his personal
reputation at stake, which I think will have to meet a far higher
standard than the rumour
publishing “go tos” of
“an anonymous source”.
The FB phone was (imho)
classic Arrington (the bad side). Posted on the weekend (in the
hopes that FB PR would be
slow to respond and
debunk it), quoting anonymous sources and no substance at all.
Basically, link bait. That sort
of story does him
(or rather his credibility) no
favours.
**************************************
swombat
774 days ago | link
Add to that that there is no
convincing reasons why this group of angels would manufacture this
story to lead him
on. Unlike with some other TC
stories which turned out to be manufactured to discredit TC, in this
one, the
sources themselves would risk a lot by
leaking this – true or
false.
*************************************
Alex3917
774 days ago | link
In Arrington’s defense his
claims are laid out clearly without any weasel words. Either this is
happening or it
isn’t. So while I’m pretty meh
about TC as a whole, I’m giving him the benefit of the doubt on
this one.
*******************************************
swombat
774 days ago | link
He doesn’t need to expose
himself to lawsuits by naming names. The names are pretty obvious to
anyone in
the
field.
**************************************
chc
774 days ago | link
Yes, but that’s the thing —
you can’t get sued for “obvious names.” Even if he’s
completely making this up, if one
of the obvious
suspects sues him, he can just say, “Oh, no, I didn’t mean
him.”
The comment I was replying to said, “his
claims are laid out clearly without any weasel words. Either this
is
happening or it isn’t.” I disagree with that
— Arrington is not laying it all out here as a black-and-white
truth.
He’s consciously omitting facts in a way
that happens to shield him from repercussions if this is false. As
a
traditional dead-tree newspaper guy, I’m very
familiar with the ways reporters fudge their claims to avoid
being
responsible if it turns out to be crap.
That’s what this sounds like to
me.
************************************************
eavc
773 days ago | link
If he calls them felons and
they wind up being acquitted for whatever reason, however technical
or stupid, then he
would be liable for libel.
He
clearly wanted to avoid using weasel words. The only way to do that
without being reckless is to not refer
directly to
the objects of the
post.
*****************************************
techiferous
774 days ago | link
“the only reason”
He
did mention that they were his friends. Perhaps he wants to nip the
illegal activity in the bud with as little
collateral
damage as
possible.
*********************************************
origoterra
774 days ago | link
Arrington is smart, a lawyer
himself, and already know he is headed straight to the witness
stand. Thanks for
blowing this whistle Mike. That’s
the TC we
like.
*******************************************
danielnicollet
774 days ago | link
If you read the full post, take
in account that he was present and saw who was there, and assume he
has not chosen
to reveal everything about the
sources through TC at this time (that’s highly understandable –
protecting his
sources and only disclosing what he
feels is verifiable), there is definitely a lot here and absolutely
enough for
a climb to the witness
stand!
***************************************
lsternlicht
774 days ago | link
I think your statement was
clear. However, I find it hard to believe Arrington would put some
of his best sources
at risk if his claims were
completely
unfounded.
**********************************************
jexe
774 days ago | link
Well, at least one investor
seems to have accidentally included himself in the mess (from TC’s
comments)
http://twitter.com/speechu/status/25083299594
*************************************************
jakevoytko
774 days ago | link
This link is now a 404.
Thankfully Google has the text of the tweet!
speechu:
Bin 38 is like heaven right now, chock-full of angels.
Not
explicitly incriminating, but it sounds pretty
bad
**********************************************
dzlobin
774 days ago | link
Strangely, it’s still on the
feed. http://twitter.com/speechu
But the status
link is
deleted
**********************************************
nostromo
774 days ago | link
I just put “forming a cartel”
on my list of things not to
tweet.
***********************************************
mrduncan
774 days ago | link
The original tweet was removed
in the past few minutes (others have dug it up again). His latest
tweet doesn’t
seem to be taking Arrington too
seriously:
Thanks Mike for techcrunching me for no
reason. Note to self: hold next secret meeting in underground bunker
to
get the feds off my trail.
Sundeep
Peechu@speechu
Thanks Mike for techcrunching me for
no reason. Note to self: hold next secret meeting in underground
bunker to get the feds off my trail.
21 Sep 10
Reply
Retweet
Favorite
***************************************************
dannyr
774 days ago | link
The tweet has been erased but
somebody did an old-school retweet of it.
“Timestamp
is 8p yesterday. RT @speechu: Bin 38 is like heaven right now,
chock-full of angels. #superevil
#evidence cc
@arrington”
Matt
Mireles@mattmireles
Timestamp is 8p yesterday. RT
@speechu: Bin 38 is like heaven right now, chock-full of angels.
#superevil #evidence cc @arrington
21 Sep 10
Reply
Retweet
Favorite
*******************************************************
hanskuder
774 days ago | link
Tweet’s now deleted. That’s
not suspicious at
all.
************************************************************
joshu
774 days ago | link
i’ve never heard of this guy
before, and he isn’t a coinvestor on any deal i’ve been
on…
**********************************************
bl4k
774 days ago | link
he works with Aydin at
Felicis
**********************************************
dannyr
774 days ago | link
Cached
version:
http://cc.bingj.com/cache.aspx?q=http://twitter.com/speechu/…
*******************************************************
danilocampos
774 days ago | link
IANAL, but as I understand
it…
Any time individuals or businesses get
together to collaborate on a strategy that restrains trade or
supply, thus
artificially skewing prices, this runs
afoul of antitrust law.
Collusion between angels to
keep valuations low and prevent newcomers from participating sounds
like a textbook
case. In this case, they’re
artificially inflating their cost of capital by reducing the overall
valuations of the
businesses they fund. They
artificially reduce the supply of capital by conspiring to keep out
new participants.
Similarly, the Department of
Justice is looking into Valley hiring, since companies have a
gentlemen’s agreement
not to poach from one
another:
http://www.forbes.com/feeds/ap/2010/09/17/technology-special…
In
this case, the argument would go that the companies are artificially
constraining the supply of paying work for
qualified
applicants, while reducing the competitive landscape that would
drive up their
salaries.
***************************************************
nostromo
774 days ago | link
It sounds like price fixing,
even though they are buying and not selling. Check out Wikipedia for
a good write-up:
“Price fixing is an agreement
between participants on the same side in a market to buy or sell a
product, service,
or commodity only at a fixed
price, or maintain the market conditions such that the price is
maintained at a given
level by controlling supply
and demand. The group of market makers involved in price fixing is
sometimes referred
to as a cartel.
The
intent of price fixing may be to push the price of a product as high
as possible, leading to profits for all
sellers,
but it may also have the goal to fix, peg, discount, or stabilize
prices. The defining characteristic of
price fixing
is any agreement regarding price, whether expressed or
implied.
Colluding on price amongst
competitors is viewed as a per se violation of the Sherman Act
regardless of the
market
impact.”
*****************************************************************
tptacek
774 days ago | link
Would it still be price fixing
if all of them got up from the table and announced the formation of
Super Angel
Capital Partners? I can’t see how;
there’s tons of VC firms already. If that’s not unlawful, how is
a joint
venture among them unlawful?
Are
we just stuck on the fact that they’re “angel investors”? The
law doesn’t recognize any such sector of the
venture
capital
business.
**********************************************
j_baker
774 days ago | link
“Would it still be price
fixing if all of them got up from the table and announced the
formation of Super Angel
Capital Partners?”
Yes.
That would effectively make SACP a cartel. Price fixing is price
fixing if it was done by a group of entities
or one
entity.
**************************************************
InclinedPlane
774 days ago | link
If they create a single super
angel corporation then they could run afoul of anti-monopoly
laws.
*****************************************
dschobel
774 days ago | link
You’re referring to the Edge
Act [1][2] and that only applies to US banks’ foreign operations
(their subsidiaries,
to be specific).
It
is still very much illegal for them to collude against US
customers.
[1]
http://en.wikipedia.org/wiki/Edge_Act
[2]
http://www.answers.com/topic/edge-act-corporation
*********************************************
jnoller
774 days ago | link
I’d like to know the laws
too, this could be construed as collusion, conspiracy and probably a
few other
things.
*****************************************
tptacek
774 days ago | link
Before I turn into “the guy
on the thread arguing that the Evil Angels are just peachy”,
banding together for the
sole purpose of pushing
back YC and making life harder for founder is a total dick move, and
I’m happy Arrington
is shaming them for it.
But
it is a much more ambitious claim to say that they’re breaking
federal laws by doing
it.
****************************************************
Federal
funds flow to clean-energy firms with Obama administration ties
By
Carol D. Leonnig and Joe Stephens, Washington Post
Sanjay
Wagle was a venture capitalist and Barack Obama fundraiser in 2008,
rallying support through a group he headed known as Clean Tech for
Obama.
Shortly after Obama’s election, he left
his California firm to join the Energy Department, just as the
administration embarked on a massive program to stimulate the
economy with federal investments in clean-technology
firms.
Following an enduring Washington tradition,
Wagle shifted from the private sector, where his firm hoped to
profit from federal investments, to an insider’s seat in the
administration’s $80 billion clean-energy investment program.
He
was one of several players in venture capital, which was providing
financial backing to start-up clean-tech companies, who moved into
the Energy Department at a time when the agency was seeking outside
expertise in the field. At the same time, their industry had a huge
stake in decisions about which companies would receive government
loans, grants and support.
During the next three
years, the department provided $2.4 billion in public funding to
clean-energy companies in which Wagle’s former firm, Vantage Point
Venture Partners, had invested, a Washington Post analysis found.
Overall, the Post found that $3.9 billion in federal grants and
financing flowed to 21 companies backed by firms with connections to
five Obama administration staffers and advisers.
Obama’s
program to invest federal funds in start-up companies — and the
failure of some of those companies — is becoming a rallying cry
for opponents in the presidential race. Mitt Romney has promised to
focus on Obama’s “record” as a “venture capitalist.” And
in ads and speeches, conservative groups and the Republican
candidates are zeroing in on the administration’s decision to
extend $535 million to the now-shuttered solar firm Solyndra and
billions of dollars more to clean-tech start-ups backed by the
president’s political allies.
White House
officials stress that staffers and advisers with venture capital
ties did not make funding decisions related to these companies. But
e-mails released in a congressional probe of Obama’s clean-tech
program show that staff and advisers with links to venture firms
informally advocated for some of those companies.
David
Gold, a venture capitalist and critic of Obama’s investments in
clean tech, said that even if staffers had been removed from the
final decision-making, they had the kind of inside access to exert
subtle influence.
“To believe those quiet
conversations don’t happen in the hallways — about a project
being in a certain congressman’s district or being associated with
a significant presidential donor, is naive,” said Gold, who once
worked at the Office of Management and Budget. “When you’re
putting this kind of pressure on an organization to make decisions
on very big dollars, there’s increased likelihood that political
connections will influence things.”
Energy
Department spokesman Damien LaVera said the companies won awards
based on merit, not political connections. He said the staffers and
advisory board members reviewed by the Post had no role in funding
decisions, nor did they have any personal financial stake in the
companies. One of those administration advisers had first been
appointed to his position by the Bush administration, LaVera
said.
“As is evident from the 10-month long
congressional investigation into Solyndra, Energy Department loans
and grants are decided on the merits,” White House spokesman Eric
Schultz said. “What’s more, these are all professionals with
expertise in clean-energy science, finance or both — but none of
them play a decisional role in DOE awards and none of them are in
positions of regulating the industry.”
Venture
capitalists arrive
During the 2008 campaign, the
venture capital industry lined up behind Obama as he vowed to spur
clean-technology development. Obama raised more than twice the
venture capital contributions of his opponent, Republican candidate
John McCain.
Known for making billions of dollars
in the 1990s on Internet startups, venture firms in 2006 were
rapidly switching to invest in clean tech. Legendary venture partner
John Doerr, a leading early investor in Google and Amazon, that year
called the clean-energy sector the next great profit center, “the
mother of all markets.”
With the 2008 economic
crisis, new private investment in fledgling clean-tech companies
withered. But passage of the $787 billion stimulus package offered
new opportunities to launch and grow those firms, with $80 billion
set aside for clean energy and energy-efficiency efforts.
Suddenly
flush with cash, the Energy Department was under orders to ramp up
quickly and get money out to promising companies. The administration
tapped industry players to take on key Energy Department roles, both
as agency staffers and outside advisers on agency boards.
Wagle,
then 38, took a job as a stimulus adviser in the agency’s recovery
act office. Officials say his role did not involve making funding
decisions for companies tied to Vantage Point.
Private
investors cheered the administration for hiring industry colleagues.
In a 2009 article, venture firm leader Jim Matheson said Wagle,
along with another Washington-bound venture capitalist, David
Danielson, would help ensure commercial successes from “the steady
flow of dollars coming out of D.C.”
Wagle’s
former employer had invested in several companies that received
federal money: Brightsource, which won a $1.6 billion federal loan
for a solar-generating plant; Tesla Motors, which won a $465 million
loan to build electric cars; and biofuels firm Mascoma, which in
2011 received $80 million for a Michigan ethanol plant.
Wagle
recently returned to the California venture capital industry to work
as an investor and clean-tech adviser. Reached at his home, he
declined to comment. Vantage Point Venture Partners, renamed Vantage
Point Capital Partners, did not respond to requests for
comment.
Danielson, formerly of General Catalyst,
joined an Energy Department office whose mission was to fund
breakthrough energy technologies. Officials say he had no role in
arranging $105 million in funding for three General Catalyst
portfolio firms.
David Sandalow, a former Clinton
administration official and Brookings Institution fellow, had been
paid $239,000 for consulting work for a venture capital firm, Good
Energies, in 2008 before joining the Energy Department as assistant
secretary for policy and international affairs, his disclosure form
shows.
A Good Energies-backed firm, SolarReserve,
won a $737 million agency loan. Officials say Sandalow played no
role in arranging it and LaVera, speaking on behalf of Sandalow,
said the assistant secretary had no financial interest in Good
Energies or SolarReserve.
The Energy Department
came under criticism from Republicans earlier this year when agency
e-mails raised questions about a possible conflict of interest
involving Steven J. Spinner, a former department loan adviser who
disclosed that his wife worked for Wilson Sonsini, a Silicon Valley
law firm that handled funding applications for several clean-tech
companies.
Wilson Sonsini’s clean-tech clients
reaped $2.75 billion in Department of Energy grants and financing,
the Post analysis found.
One of the firm’s
clients was Solyndra. Republicans have accused the Obama
administration of favoring the risky company because its leading
investor was tied to a major Obama donor.
Wilson
Sonsini had its own connection to the White House: the firm’s
chief executive, John Roos, was a top bundler for Obama’s 2008
campaign.
Before joining the administration,
Spinner, a venture investor and start-up adviser, also helped raise
$500,000 for Obama as a member of his national campaign finance
committee. He has pledged to raise a half-million dollars or more
for Obama’s reelection effort.
Once inside the
agency, Spinner agreed not to discuss loan matters involving Wilson
Sonsini clients. But e-mails show he urged career officials to
resolve delays in the Solyndra loan, and also defended the financial
prospects of Solyndra to a White House deputy before its federal
loan was approved.
Spinner left the Energy
Department in the fall of 2010. He did not respond to requests for
comment. The department said Spinner was not involved in the
company’s application review or loan approval.
A
Wilson Sonsini spokesman said the firm does not believe its
employment of Spinner’s wife influenced Energy Department
decisions.
I nvestors as advisers
Thousands
of agency and White House e-mails released as part of the Solyndra
investigation show that venture capitalists who held advisory roles
with the Energy Department were given access to Obama’s top
advisers.
Steve Westly, an Obama fundraising
bundler for both his 2008 and 2012 campaigns, is a founder of the
venture firm Westly Group and served part time on Energy Secretary
Steven Chu’s advisory board.
The e-mails show
that Westly communicated with senior White House officials,
including Obama adviser Valerie Jarrett, voicing concerns about the
president’s planned appearance at Solyndra.
Westly’s
firm also fared well in the agency’s distribution of loans and
grants. Its portfolio companies received $600 million in funding.
LaVera said Westly had no role in the funding decisions.
David
Prend also surfaces in the e-mails as a venture capital investor who
had White House access.
His firm, Rockport Capital
Partners in Boston, was among the investors in Solyndra, with a 7.5
percent stake. The e-mails show him asking a White House aide to
“help get the word out” about Solyndra and asking for help on
another Rockport portfolio company. They show he and a group of
venture capital investors met with new White House climate czar
Carol Browner before Solyndra’s loan was tenatively approved, and
the White House confirmed that the subject of the company came up
briefly.
Prend had worked closely with the Energy
Department since the Bush administration, when he was first
appointed to an advisory panel for the National Renewable Energy
Laboratory. He continued to advise the Obama administration, while
also chairing a panel that helps advise the department on solar
technologies.
The agency provided $550 million to
several firms in which Rockport had invested at the time. The
department gave an additional $118 million grant to an electric-car
battery company, Ener1, that was partnered with Rockport portfolio
car company Think. (Rockport soon after invested in Ener1.) Ener1
filed for bankruptcy protection last month.
LaVera
and Chad Kolton, a Rockport spokesman, said that Prend’s advisory
role was separate from stimulus programs and had no bearing on
agency decisions about companies backed by Rockport.
Research
editor Alice Crites contributed to this
story.
********************************************************
POTOMAC
WATCH
May 24, 2012, 7:24 p.m. ET
Vulture
Capitalism? Try Obama’s Version. A profit-driven economy is
preferable to one run by political favoritism.
President
Obama is no fan of Mitt Romney-style “vulture” capitalism. So
what’s his alternative?
All those Republicans
grousing about the president’s attacks on private equity might
instead be seizing on this beautiful point of contrast. Mr. Obama,
after all, is no mere mortal president. Even as he’s been
busy with the day job, he’s found time to moonlight as
CEO-in-Chief of half the nation’s industry. Detroit, the energy
sector, health care—he’s all over these guys like a cheap
spreadsheet. Like Mr. Romney, Mr. Obama has presided over
bankruptcies, layoffs, lost pensions, run-ups in debt. Yet
unlike Mr. Romney, Mr. Obama’s C-suite required billions in
taxpayer dollars and subsidies, as well as mandates,
regulations, union payoffs and moral hazard. Don’t like
“vulture” capitalism? Check out the form the president’s had
on offer these past
three years: “crony” capitalism.
The case study is the solar-panel maker Solyndra, which was part of
a green-energy sector that even by 2009 was flailing. The
president took one look at the industry’s utter lack of both
profits and sellable products, and yelled “that’s my baby!”
The stimulus bill shipped tens of billions of dollars to the Energy
Department to pour into green companies via grants and loans.
It promised five million jobs.
The Energy Department’s
nuclear physicists were admittedly a bit flummoxed by the
whole P&L thing, but they got their venture-capitalism groove on
and in 2009 handed Solyndra a $535 million loan guarantee.
Even prior to disbursement, government accountants were
warning that Solyndra was a lemon, but the White House didn’t
worry. After all, the IRS had only recently and conveniently
tripled the tax credit (to 30%) for buyers of Solyndra
products, which the government figured would help grease their
start-up’s skids.
Unfortunately, the
physicist-CFOs overlooked that whole “global energy
market” factor—easy mistake! Foreign competitors were
already piling into
Solyndra’s niche. Unable to
compete, the firm went bankrupt last year. And, oh, the
carnage! It was kind of like . . . GST Steel! Only worse.
Solyndra laid off 1,100 employees. It provided no severance,
not even back pay due for vacation credits. But a
bankruptcy judge would later approve $370,000 in bonuses for
20 employees. Mr. Obama railed against the high-dollar
Silicon Valley investors who lined up in front of government to
“suck” the remaining “life” out of the bankrupt firm,
even as employees were left to . . . Oh, wait. He said no such
thing. He was probably too busy doing damage control on his other
government subsidized energy bankruptcies, from Beacon to
Ener1. Or running down the latest report of a government-funded,
instantaneously combusting electric car. (Karma, anyone? Now at the
low, low price of $103,000. Fire extinguisher included.) Speaking of
cars, Detroit is the business venture Mr. Obama’s team has been
most flogging as a success. True, General Motors and Chrysler are
still turning their lights on, though they’d have arguably been
doing the same had they been left to go through normal, orderly
bankruptcies like those that helped the steel and airline
industries
restructure to become more competitive. To get to
the same place, Mr. Obama’s crony capitalism handed $82 billion in
taxpayer dollars to the two firms. That bailout money went to make
sure the unions that helped drive GM to bankruptcy (and helped elect
Mr. Obama) did not have to give up pay or
pension benefits for
current workers. They were instead rewarded with a share of the new
firm. The UAW at GM meanwhile used the government-run bankruptcy to
bar some 2,500 nonunion workers who had been laid off from
transferring to other plants. How truly vulture-like.
Contract
law was shredded, as unions were given preference over other
creditors, such as pension funds for retired teachers and police
officers. Congressmen used political sway to keep open their weak
auto dealerships, forcing layoffs at stronger ones (vulture . . .
vulture . . . vulture). Political masters obliged the industry to
pour resources into unpopular green cars. The political masters were
obliged to offer $10,000 tax credits to
convince
Americans to buy them. (They still won’t.) And the message to
every big industry? Go ahead, run your business into the ground. The
Capitalist-in-Chief has your back (especially if you are unionized).
So, take your pick. Mr. Obama’s knock on free enterprise is that
it is driven by “profit,” and
that this experience
makes Mr. Romney too heartless to be president. The alternative is
an Obama capitalism that is driven by political favoritism,
government subsidies, mandates, and billions in taxpayer
underwriting—and that really is a path to bankruptcies and
layoffs. If the president wants to put all 3,545 green stimulus jobs
he’s created up against Bain’s record, he should feel free. Mr.
Romney could make the comparison himself. Ronald Reagan ran against
Jimmy Carter’s own industrial policy, and to great success. Viewed
in isolation, “vulture” capitalism has some PR downsides. Viewed
against the alternative, it’s a flat-out winner. Write
to
kim@wsj.com
********************************************
Political
Payback: Green Corruption –– Part One
Author:
Christine Lakatos — Published: Jul 30, 2010
Alarmingly,
our environment has been hijacked by uber-rich individuals, crooked
politicians, and an assortment of left-wing extremists that are
fueled by greed and power attached to a radical agenda to bring
about “global governance,” “redistribute the wealth,” and
put the progressive movement –– big government, social justice
and the death of capitalism –– on the fast track. Under the
guise of “saving the planet,” these “players,” who are all
interconnected in a variety of ways, are transforming our climate
into something more sinister –– a scam of epic proportions. Due
to its magnitude and the potential dire consequences to our economy,
our freedoms, and the voices of the honorable environmentalists ––
this “Climate Scam” will be confronted in three parts
Green
Corruption, Part One
TROXLER AND BROWN PREDICTIONS
OF GREEN CORRUPTION CONFIRMED
This year, Lee Troxler and
Floyd Brown in their newly released hit book, Killing Wealth,
Freeing Wealth How to Save America’s Economy and Your Own, chapter
ten –– The Biggest Financial Bubble in US History, is where the
authors’ predicted that the veteran Silicon Valley venture-capital
firm Kleiner Perkins Caufield & Byers (KPCB) ––
multi-millionaire Al Gore and billionaire John Doerr are both
partners –– would get government contracts from the Obama
administration unfairly. In developing this story, which took months
of research, backed up with extensive resources, we learned through
an anonymous source that there are multiple federal investigations
from different agencies and senators underway against the Department
of Energy (DOE), in particular, the Loan Guarantee Program (LGP) and
possibly others. Our source, who is close to the some of the ongoing
investigations –– “guarantees there was corruption and bad
ethics involved” and that at this time “a number of the
investigations are getting stonewalled.” Our findings, along with
this recent inside information, confirms Troxler and Browns’
predictions –– corruption on the “green front.” As we
learn more, we will share the details.
At this time
we do know that the U.S. Government Accountability Office (GAO) has
been in the process of reviewing –– in response to Congress’
mandate –– the DOE’s execution of the Loan Guarantee Program
(LGP), which was established as part of the Energy Policy Act of
2005 and set up for innovative energy projects. About two
weeks ago (July 12, 2010), the GAO released their findings and
recommendations, noting that the “LGP scope has expanded both in
the types of projects it can support and in the amount of loan
guarantee authority available. DOE currently has loan guarantee
authority estimated at about $77 billion and is seeking additional
authority.”
At issue, the DOE’s lack of
“comprehensive performance goals,” particularly in relation to
the DOE’s “broad policy goal of helping to mitigate climate
change and create jobs.” The GAO concludes, “Without
comprehensive performance goals, DOE lacks the foundation to assess
the program’s progress and, more specifically, to determine
whether the projects selected for loan guarantees help achieve the
desired results.” Predictably, the GAO also found that the “DOE’s
implementation of the LGP has treated applicants inconsistently,
favoring some and disadvantaging others, as well as the fact that
the “DOE lacks systematic mechanisms for LGP applicants to
administratively appeal its decisions or to provide feedback to DOE
on its process for issuing loan guarantees.”
OBAMA’S
GREEN STIMULUS
In February 2009 Congress passed the
American Recovery and Reinvestment Act (ARRA), the $862 billion
stimulus package, for which $86 billion was earmarked for “green,”
of which the Apollo Alliance –– a left-wing organization who
exerts a powerful influence on the views and policies of the Obama
administration –– was also involved in drafting. More on Apollo
later, but Kleiner Perkins are like ants at a picnic; they’re
everywhere that’s green, including on the Apollo board, where they
have placed one of their partners, Ellen Pao. Furthermore, Obama was
a candidate that both Gore and Doerr had strenuously campaigned for,
including financial donations, and early on, Doerr had his hand in
shaping ARRA, “urging” Obama’s transition team and leaders in
Congress “to use the new economic stimulus package to modernize
the electric grid and offer new incentives to help clean energy
startups get off the ground.” Doerr also sits on Obama’s
Economic Recovery Advisory Board (PERAB), who President Obama
appointed as one of the “chosen” back in January 2009. In
following the ARRA, meant to stimulate the economy and create jobs,
it is clear that the Obama administration is circuitously funneling
government contracts to their favored companies –– “stimulating”
the “green” pockets of Kleiner Perkins. This screams corruption
and it’s time to call in a special prosecutor!
FOLLOW
THE “GREEN” MONEY: KPCB GREENTECH PORTFOLIO
Since
last summer when the Department of Energy (DOE) starting handing out
the $86 billion “green stimulus” money, Gore and Doerr’s
“green companies” have been cashing in big time –– billions
of taxpayer dollars! Keep in mind, this doesn’t account for
funds not yet allocated, or hidden contracts, nor the mass amount of
money KPCB and others in the Climate Scam will generate if the U.S.
climate legislation becomes law –– “Obama Climate,” more
specifically cap-and-trade, which will be covered in more detail
later. So far over fifty percent of the companies listed on the
Kleiner Perkins Caufield & Byers Greentech Portfolio, of which
KPCB partners are positioned on the board of many, have ––
directly and indirectly –– received money from the “Obama
Green Stimulus” package as well as through other government
programs approved by the Obama administration.
AL
GORE’S FISKER AUTOMOTIVE $529 MILLION DOE LOAN IGNITES RED
FLAGS
One of the most blatant government
favoritism, catching headlines in the Wall Street Journal back in
September 2009 –– Gore-Backed Car Firm Gets Large U.S. Loan ––
was the $529 million dollar government loan guarantee (which was
cinched in May 2010) that Fisker Automotive received to build its
high-end, hybrid sports coupe, Fisker Karma –– to be
manufactured in Finland and sold for $89,000. Fisker
Automotive was a 2008 investment for Kleiner Perkins and it was
“confirmed” that Gore has already purchased his “Karma.”
In
June 2009 the DOE announced three other large government loans that
included $5.9 billion to Ford Motor Company, $1.6 billion to Nissan
Motors, and $465 million to Tesla Motors. Although the four loans
came out of the DOE’s $25-billion Advanced Technologies Vehicle
Manufacturing (ATVM) Loan Program, it was approved by the Obama
administration and it did ignite some red flags.
As
reported by the Wall Street Journal, “the awards to Fisker and
Tesla prompted criticism from groups that question why vehicles
aimed at the wealthiest customers are getting loans subsidized by
taxpayers” and “concern from companies that had their bids for
loans rejected,” Included in the reaction was Leslie Paige, a
spokeswoman for Citizens Against Government Waste, “This is not
for average Americans.” “It’s status symbol thing,” Ms.
Paige added. More gripping is the fact that this “favoritism”
didn’t sit well with some of the firms that were turned down for
loans from the DOE –– stating “they did not get much feedback
from the department about their applications” and “were unable
to get a full explanation as to why their loan request was turned
down.”
THE VINOD KHOLSA CONNCECTION
The
CEO of EcoMotors John Colettie, whose $20 million ATVM loan from the
DOE was denied, didn’t have an “issue” with the winners.
Probably because EcoMotors’ lead investor is Vinod Khosla, an
affiliated partner of Kleiner Perkins, whose firm Khosla Ventures
has also invested in some of the same companies as Kleiner Perkins,
which have received government funding including Obama Green
Stimulus cash. Those companies include; AltaRock Energy Inc., $25
million grant from the stimulus; Amyris Biotechnologies, $25 million
grant from the stimulus; and Mascoma Corporation has received state
and federal grants from the DOE since 2006, totaling over $170
million and as recent as 2008, received another $49.5 million in
funding from the DOE and the state of Michigan.
SILVER
SPRING NETWORKS SCORES OVER $700 MILLION IN SMART-GRID GREEN
STIMULUS FUNDS –– RIGGING THE BIDDING PROCESS?
One of
the most contentious of Obama Green Stimulus money awards comes out
of the ashes of the $4 billion smart-grid grants, with some of
the nation’s largest providers of electricity meters “crying
foul” over the smart-grid standards in the stimulus bill,
according to a report by USA TODAY in February 2009. Additionally,
they said that the economic stimulus bill “could put them out of
business and wreak havoc in the new market for smart-grid technology
by favoring certain computer network standards.”
Itron,
Landis+Gyr, Elster and Aclara even wrote a letter to U.S. Senators
to voice their concerns regarding the “protocols and standards”
that were placed into the House version of the legislation for all
smart-grid projects, which states that “utilities receiving
funding must use Internet-based or other open protocols and
standards if available and appropriate.” Ed Gray, vice president
of regulatory affairs for smart-meter provider Elster, said “the
bill gives a leg up to Silver Spring at the expense of other
providers.”
Interestingly, in March 2009, a month
after the stimulus bill had already passed, Jeff St. John from
GreenTechMedia.com, quoted a statement made by Stuart Bush, an
alternative energy analyst for RBC Capital Markets, “both
Trilliant and Silver Spring (both smart-grid communications
companies) could benefit from the way the stimulus plan was
structured to require open standards.” Bush also added, “Clearly
the West Coast VC guys had a lot of lobby pull getting that in
there.”
Clearly the “West Coast VC guys” ––
Kleiner Perkins (Gore and Doerr), have more than “lobby pull.”
In fact, Silver Spring Networks, as revealed in Troxler and Browns
book, is one of Kleiner Perkins shining “green” companies ––
their 2008, $75-million investment has scored over $700 million!
Since August of 2009 when the DOE started dishing out the $4-billion
from the Smart Grid Investment Grant Program (part of the stimulus
plan) –– awarded to selected utility companies for particular
smart-grid projects –– close to sixty percent of Silver Spring
“customers” were winners.
•
American Electric Power (AEP) received $75 million for AEP Ohio
gridSMARTSM Demonstration Project, announces earth2tech.com in
August 2009. It should be noted here that Richard Sandor is on the
AEP board. Sandor, Chairman and founder of the Chicago Climate
Exchange, who is connected to President Obama and Al Gore, is
another key “player” in this Climate Scan, which will be exposed
later.
• Bluebonnet Electric
Cooperative got $18.8 million for a general smart- grid build out in
Texas as reported in August 2009 by earth2tech.com. Additionally, in
November 2009 Austin’s Pecan Street Project won $10.4 million in
federal stimulus money to create a smart-grid demonstration project,
which includes Bluebonnet as part or their Technology Review and
Advisory Committee.
• In October 2009
Florida Power & Electric was awarded $200 milllion for Energy
Smart Florida –– posted by earth2tech.com.
•
In April 2010 Pepco Holdings Inc. signed contracts for three ARRA
grants totaling $168.1 million to advance smart-grid projects,
reported by the Washington Business Journal. Additionally in April
2010, Secretary of Energy Steven Chu announced $100 million from the
stimulus will go for Smart Grid Workforce Training and Development,
of which Florida Power & Light got $5 million and Pepco got just
over $4.3 million.
• In October 2009,
“the U.S. Department of Energy announced that Modesto Irrigation
District (MID) was one of only six California utilities selected to
receive a $1.5 million federal stimulus grant to support MID’s
efforts to install smart control equipment throughout its electric
infrastructure” –– published in an Oracle Press Release.
•
Oklahoma Gas and Electric Co. received a $130 million stimulus grant
for a 771,000 smart meter deployment, as reported in October 2009 by
GreenTechGrid.com.
• Sacramento
Municipal Utility District got a $127.5 million stimulus grant for a
comprehensive regional smart-grid system, announced in October 2009
by GreenTechGrid.com.
• According to
an August 2009 article by earth2tech.com, Pacific Gas and Electric
(PG&E) –– another Silver Spring customer –– “applied
for $42.5 million government grant for home area networks in
conjunction with the city of San Jose and Stanford University,”
yet it is unclear whether or not they received it. However, in May
2010, the DOE awarded PG&E a $25 million stimulus grant to
develop compressed air storage for electricity” –– writes the
San Francisco Business Times.
But the “government
bucks” don’t stop at Silver Spring Networks…
Ausra
Inc.
Ausra Inc. –– a KPCP investment that “develops
and deploys utility-scale solar technologies,” was acquired by
AREVA Inc. in March 2010. Then in July 2010 “AREVA accepted the
U.S. Department of Energy’s (DOE) offer of a conditional
commitment to issue a $2 billion loan guarantee to support
construction of the Eagle Rock Enrichment Facility, AREVA’s $3
billion state-of-the-art gas centrifuge enrichment plant in
Bonneville County, Idaho.”
Bloom Energy
Bloom
Energy –– Kleiner Perkins is listed as a primary investor and
John Doerr as a board member –– in February 2010 launched its
Bloom Box. The real name is the “Bloom Energy Server” and is
marketed as “a stand-alone electric generator that requires no
connection to any centralized power generating plant and no
coal-based or oil-based fuel to operate it” (translation: cheap,
clean energy flows almost magically from a refrigerator-sized box).
The Bloom Box debuted in a “big scoop” segment on 60 Minutes on
February 21, 2010, followed with a star-studded (Governor Arnold
Schwarzenegger and Colin Powell) Bloom Energy Press Conference
attended and filmed by TheAutoChannel.com. Marc J. Rauch
Executive Vice President/Co-Publisher of The Auto Channel noted
“our contact [at the National Renewable Energy Labs (NREL) in
Colorado] had known of the Bloom technology and revealed that the
government had actually provided a $5 million grant to the company
during its development stage. There are also rumors (and news) of
“an enormous government contract to order the Bloom Box” and
Bloom Energy “is due for a verdict on their DOE stimulus funds
shortly,” as reported by GreenTechMedia.com, February 19,
2010.
Harvest Power Inc.
Harvest Power
Inc., backed by Kleiner Perkins, is basically a company that “turns
trash into fertilizer and fuel,” and according to a June 2009
article by GreenEnergyNews.com and a City of San Jose Press
Release, “GreenWaste Recovery would partner with Harvest Power
Inc. on a project (if approved by the city council) known as the
Zanker Road Biogas facility.” Mayor Chuck Reed said in a
statement, “This project not only demonstrates San Jose’s
leadership in the production of renewable energy but will help us
meet the economic development, zero waste and energy goals of our
city’s Green Vision,”
Evidently, the Green Vision is
raking in big bucks from the Obama Green Stimulus, as reflected in
their 2009 Annual Report –– “In 2009 over $50 million in
federal and state grant money, including federal stimulus dollars
were allocated or awarded towards projects that will advance Green
Vision goals.” Additionally, “local companies received over $80
million in federal tax credits that will spur expansions and hiring
in sectors such as renewable energy,” and as of May 2010, the City
of San Jose –– Capitol of Silicon Valley –– “is estimated
to receive nearly $108 million in Recovery Act
funds.”
MiaSolé
MiaSolé Thin-film
Solar, part of the KPCB Greentech Portfolio, with “more than 500
applications that were submitted for the tax credits,” in January
2010 MiaSole “received two Advanced Energy Manufacturing tax
credits totaling $101.8 million from the Obama administration for
the manufacture of low-cost thin-film cells and
modules.”
RecycleBank
RecycleBank ––
another Kleiner Perkins green investment –– works with
municipalities and haulers to measure and reward residents for
recycling. As reported by RecycleBank, “in April 2009 $2.8 billion
were allocated to cities with 14 uses that include recycle
projects.” It turns out that Philadelphia, Pennsylvania; Houston,
Texas; and Hartford, Connecticut were the first cities to “take
advantage of stimulus funds and work with RecycleBank to improve
their waste diversion rates.” Also, in August 2009, Chicago
became the first Illinois city to partner with RecycleBank, then
there are the cities in between, and recently in February 2010, Los
Angeles became the largest city to partner with RecycleBank.
While
it is obvious that the folks at Kleiner Perkins have strategically
positioned their investments to profit from “green,” including
the massive influx of taxpayer money, placing them ahead of the
competition –– still others need government mandates and
regulations to really make them fly. One company in particular is
Hara Software, “a company that sells software to help businesses
measure and reduce their greenhouse gas emissions,” where three
KPCB partners sit on the Hara board. In a June 2009 article by
Reuters –– Gore-Backed Hara Sees Profit From Low-carbon Economy
–– Hara Chief Executive Amit Chatterjee, who in July 2009 was
part of a group of “innovative energy leaders” that “advised
Obama,” stated that [cap-and-trade] “will force companies to
act, as opposed to seeing the business benefit of acting.” “The
debate alone of ‘cap and trade’ is a driver for our product,”
Chatterjee added.
Considering the magnitude of this
Climate Scam –– its scope; cost and paybacks; “players” and
agendas –– these findings may only scratch the surface. This
Climate Scam goes beyond the billions of taxpayer dollars that Gore
and Doerr, via Kleiner Perkins, have already unfairly snagged from
the Obama Green Stimulus and huge DOE grants and loans. More
disturbing is the fact that these “players” –– and others
that will be exposed in Green Corruption parts two and three ––
have direct ties to the Obama White House, strong influence over
government policy, and are connected to the rest of those caught up
in this scam, including the hard-core-left-wing radicals
Moreover,
most of “the players” have helped create, shape, facilitate,
lobby, testify, sell, and even if the planet blows up, will get
their cap-and-trade, which despite reports that it’s dead in the
Senate, will soon to be on the Obama agenda –– the real pot of
gold at the end of the “climate rainbow.”
Article
Author: Christine Lakatos
Mom, author, blogger ––
Fitness Flash, politics, culture, and more; ACE Certified Fitness
Trainer since 1980; retired bodybuilder and fitness competitor; and
American Gladiator contestant back in 1990. MY DIVA DIET: Fitness
Book Series for women of all ages at www.MyDivaDiet.com.
Read
more:
http://blogcritics.org/politics/article/obamas-political-payback-green-corruption-part/page-7/#ixzz0vD7iSp5n
****************************************
The
Greentech VC Influence Over Washington
By Katie
Fehrenbacher Aug. 18, 2010, 8:28am PDT
There’ve
been a couple articles in the past few weeks pointing to
President Obama as the “ clean tech investor in chief” and the
presidential VC with bets on clean energy. The real trend is that
venture capitalists focusing on greentech seem to have had an
unprecedented influence on U.S. federal policy and allocations of
the stimulus package. When I attended the Department of Energy’s
(DOE) first ARPA-E conference (Advanced Research
Projects
Agency-Energy) earlier this year in Washington D.C., I was struck by
how many venture capitalists were there. I shared a cab back to the
airport with some familiar Silicon Valley faces, and was told if
your firm didn’t have a dedicated person in Washington — in some
circles they call them
lobbyists — maneuvering grant
and loan programs, you weren’t able to be competitive. Just look
at the figures from the stimulus package (which I am fully in
support of): somewhere between $50 billion and $80 billion into
clean power and energy efficiency initiatives ( depending on how you
slice it). The Obama administration has gone out of its way to seek
the advice of greenleaning venture capitalists and entrepreneurs in
the Valley on how to spend that
colossal amount and what
programs would be the most affective. Kleiner Perkins managing
partner John Doerr is on President Obama’s
Economic
Recovery Advisory Board, and was able to convince Vice President Al
Gore to join Kleiner, in addition to former Secretary of State Colin
Powell. Kleiner’s investments have had some successful government
bids, most notably the $529 million loan to Kleiner portfolio
company Fisker Automotive out of the DOE’s highly competitive
Advanced Technology Vehicles Manufacturing, or ATVM, program. Fisker
plans to use the loan to build its factory and launch its electric
vehicle in 2011. If you remember, another winner of the $25 billion
ATVM program was Tesla Motors, which, as most of us know, was backed
by venture capitalists from Draper Fisher Jurvetson, Technology
Partners, and Vantage Point among others. I attended Khosla
Venture’s LP meeting earlier this year where the firm announced
that former UK Prime Minister Tony Blair would be joining the firm
as Senior Advisor. Several of my journalism peers were comparing the
political influence Blair could wield to what Kleiner was doing with
Gore. The Obama administration appointed former venture capitalist
Jonathan Silver as its loan chief to lead both the DOE’s loan
guarantee and ATVM loan programs. About a third of the DOE’s loan
guarantee commitments went to venture-backed startups, including
thin film solar maker Solyndra and solar thermal company
BrightSource. I wondered earlier this year if the loan guarantee for
Solyndra wasn’t a mistake, given the company has one of the
highest manufacturing costs out of its competitors. The company
withdrew its IPO plans, citing poor market conditions. The
Government Accountability Office also found that the loan guarantee
process treated some companies unfairly in their bids and risked
“excluding some potential applicants unnecessarily.” There’s
nothing inherently wrong with venture-backed companies getting
government support, and the energy sector needs even more federal
funding to create innovation. I support Doerr and Bill Gates’
calls for boosting federal government investing to $16 billion per
year into energy innovation. All I’m saying is that this level of
influence should be
watched.
********************************************
This
is how VC’s and DOE Staff work together as reported by one of
Tesla Motors senior executives:
In Role as
Kingmaker, the Energy Department
Stifles Innovation
By
Darryl Siry of Tesla Motors December 1, 2009
Of
all of the Department of Energy programs intended to advance the
green agenda while stimulating the economy, the Advanced Technology
Vehicle Manufacturing incentive to spur the development of cleaner,
greener automobiles is perhaps the most ambitious. But it has a
downside.
The energy department has approved direct loans
to Nissan, Ford, Tesla Motors and Fisker Automotive totaling about
$8 billion out of a budget of $25 billion. The magnitude of this
program dwarfs other DOE campaigns like the $2.4 billion given to
battery and electric vehicle component
manufacturers and
the $4 billion disbursed for “smart grid” projects. To the
recipients the support is a vital and welcome boost. But this
massive government intervention in private capital markets may have
the unintended consequence of stifling innovation by reducing
the
flow of private capital into ventures that are not
anointed by the DOE.To understand this apparent contradiction, you
have to look at the market from the perspective of venture
capitalists looking to deploy investors’ capital and startups
looking to attract it. Venture capitalists evaluate a company on the
basis of whether they think it will succeed and generate returns for
their portfolios. While this evaluation is a function of many
things, one key question is
how much more capital the
company will need to get its product to market or a liquidity event
so that the venture capitalist can see a return. The more capital it
needs, the more dilutive it will be to the early investors. In
cleantech, and in particular alternative fuel vehicles, the capital
requirements for companies bringing a car to market in significant
numbers can be extraordinarily high, reaching into the hundreds of
millions of dollars if the company wants to build its own
manufacturing facilities. To a venture capitalist, this capital
requirement can be daunting. This is why government financing is
so
attractive. In the case of the advanced technology manufacturing
loans, the DOE steps up for 80 percent of the total amount needed.
Private sources fund the other 20 percent. This amounts to free
leverage for the venture capitalist’s bet, with no downside. Hedge
funds historically used massive
leverage to generate
outsized returns, but if the trade turns against them, that same
leverage multiplies their downside and can lead to financial ruin.
In the case of the DOE loans or grants, the upside is multiplied and
the downside remains the same since the most the equity investor can
lose is the
original investment. The proposition is so
irresistible that any reasonable person would prefer to back a
company that has
received a DOE loan or grant than a
company that has not. It is this distortion of the market for
private capital that will have a stifling effect on innovation, as
private capital chases fewer deals and companies that do not have
government backing have a harder time attracting private capital.
This
doesn’t mean deals won’t get done outside of the
energy department’s umbrella, but it means fewer deals will be
done and at worse terms.
According to Earth2Tech, venture
capitalist John Doerr commented on this at the GreenBeat conference
earlier this month, saying “If we’d been able to foresee the
crash of the market we wouldn’t probably have launched a green
initiative. Because these ventures really need capital. The
only
way in which we were lucky I think is that the government stepped
in, particularly the Department of Energy. Led by this great
administration that put in place these loan guarantees.” Several
sources within startup companies seeking DOE loans or grants have
admitted that private fundraising is complicated by investor
expectations of government support. None would speak publicly due to
the sensitivity of the issue and the ongoing application
process.
Aptera Motors has struggled this year to raise
money to fund production of the Aptera 2e, its innovative
aerodynamic electric 3-wheeler, recently laying off 25 percent of
its staff to focus on pursuing a DOE loan. According to a source
close to the company, “all of the engineers are working
on
documentation for the DOE loan. Not on the vehicle itself.”
Another highly placed source at Aptera told Wired.com many potential
investors wanted to see approval of the DOE loan before committing
to invest. Startup companies that enjoy DOE support, most notably
Tesla Motors and Fisker Automotive, have an extraordinary advantage
over potential competitors since they have secured access to capital
on very cheap terms. The magnitude of this advantage puts the DOE in
the role of kingmaker with the power to vault a small startup with
no product on the market -– as is the case with Fisker — into
a
potential global player on the back of government
financial support.As a result, the vibrant and competitive market
for ideas chasing venture capital that has been the engine of
innovation for decades in the United States is being subordinated to
the judgments and political inclinations of a government bureaucracy
that has never before wielded such market power. A potential
solution to this problem may seem counter-intuitive. The best way to
avoid market distortion would be for the DOE to cast the net more
broadly and provide loans and grants to a larger number of companies
— which ironically means being less selective. Subject to the
existing equity matching requirement, this would allow the private
markets to function more effectively in funding a broader range of
companies and driving more innovation. Several innovative companies
with great potential have been in the DOE pipeline for many months.
Perhaps it is time for the DOE to stop playing favorites and start
spreading the love. Wired.com contacted the Department of Energy for
comment but did not receive a reply. Disclosure: Darryl Siry was the
chief marketing officer of Tesla Motors from December 2006 until
December 2008 and is a special advisor to Coda Automotive, which has
not sought an Advanced Technology Vehicle Manufacturing loan. Photo:
Ford Motor Co. Energy Secretary Steven Chu addresses Ford employees
on June 23, 2009, after announcing the automaker will receive a $5.9
billion
loan.
********************************************
http://www.growvc.com/blog/2010/09/venture-capital-conspiracy-theory-in-the-free-world/
Venture
Capital Conspiracy Theory In The Free World
by:
neil
Wow! Really? No Way! Wow!….this was my
reaction to the ‘revelation’ of a post by Michael Arrington’s
“So a Blogger Walks Into A Bar…”
This true
account of what happens when Tech Crunch’s Mike Arrington walks
into a Silicon Valley bar has all the trappings of a gangster movie.
For starters, the bar, a group of powerful early stage investors
meeting, colluding, plotting against any competition, an agenda on
how to control the industry and monopolize and this is NOT a movie!
Here is an extract of Mike’s account:
I’ve
never seen a more guilty looking group of people. But that alone
isn’t that big of a deal. Lively conversations often die quickly
when I arrive, and I’ve learned not to take it personally. But I
did sniff around a little afterwards, and have spoken to three
people who were at that meeting. And that’s where things got
interesting.
This group of investors, which
together account for nearly 100% of early stage startup deals in
Silicon Valley, have been meeting regularly to compare notes. Early
on it was mostly to complain about a variety of things. But the
conversation has evolved to the point where these super angels are
actually colluding (and I don’t use that word lightly) to solve a
number of problems, say multiple sources who are part of the group
and were at the dinner.
Is there room for price
fixing, total control and a greed based structure in the free market
world? Is this really best for startups? For entrepreneurs? For
Silicon Valley which is a renowned culture known for promoting
innovation and talent in startups?
This entire
scenario is wrong on so many different levels but knowing this is
what can happen within closed doors here are some changes critical
to a culture which reflects the values of a entrepreneurial
community and a better future for startups:
1. We
need transparency. This is very evident from what we’ve just
witnessed.
2. Do things in the open and on the
record. Why can’t investors, entrepreneurs and other stakeholders
work in a transparent environment online where there is automatic
accountability and governance through open interactions and a
community that can see what’s going on?
3. The
system has to benefit all parties involved. Entrepreneurs, investors
and others. It needs to be fair and favor innovation. Bring up the
best. Mystique, lack of transparency, complex rules are not benefit
of anything but greed
4. There is no room for
protectionism in a free market. We don’t need early stage capital
markets to be exclusive to a select few who control everything. We
need to make it more inclusive and involve as many as possible. The
more support, the more investors, more and better companies will be
born.
*******************************************
http://techcrunch.com/2010/09/23/ron-conway-angel-email/
Ron
Conway Drops A Nuclear Bomb On The Super Angels [Email]
Mg
Siegler
Thursday, September 23rd, 2010
As we just
stated in our previous post, there was clearly an email sent by
angel investor Ron Conway to a group of super angels who were likely
involved in the Bin 38 “AngelGate” meeting that Mike stumbled
into a couple days ago. We’ve now received a copy of the email
that Conway sent from an anonymous tipster. And we’ve confirmed it
is authentic from one of the recipients.
It’s a
bombshell. No, it’s a nuclear bomb. It speaks for itself. Read it
below.
Subject: Super Angels Gathering
I
want to share my views on the two gatherings you had in June and
this week and what they represent in my opinion.
So
that I would not be influenced by any outside inputs I am writing
this without sharing my thoughts with anyone including David Lee and
the other SV Angel Partners.
I want to clarify once
and for all my total disagreement with your values and motives for
being investors.
I have stated consistently for
year that I invest because I love helping entrepenuers and watching
them learn and succeed.
I am honored that
entrepenuers share their crystal ball views of the future of
innovation and technology with us and respect the guts it takes to
start a company.
At SV Angel we try to reciprocate
by adding value any way we can.
I think that
actions speak louder than words and SV Angel has always been a
friend of entrepenuers and we focus our business to help
entrepenuers achieve success.
The world of startups
would be a better place if you spent less time complaining about
deal structures, terms, vc’s, and valuations etc and the cars you
drive, and just helped entrepenuers build their companies.
The
Free Enterprise system is very efficient …..why not let the
marketplace demands decide on these issues, its worked for many many
years. These startups are binary …they succeed or fail so why
waste time on deal structures, terms, vc’s, and valuations etc and
just help entrepenuers build their companies.
In my
opinion your motives are driven by self serving factors around ego
satisfaction and “making a buck”.
My motives
and values are very different.
They are so
different I want to be up front with you and recognize this and
disengage from any involvement with you. I will not be a
hypocrite.
I am tired of seeing you and engaging in
idle chit chat and not sharing my true feelings.
I
think you have a different value set and lets agree to disagree and
not have to even engage in any idle chit chat or discussion of any
sort….ever.
Furhermore, I regret David Lee was
involved in the gatherings. I am sure he does too.
We
talked about the first dinner and I encouraged him to write the
email above and withdraw….I know he was uncomfortable with both
gatherings….where no one was there to speak up for the interests
of the entrepenuers.
By now you are rolling your
eyes and saying “Ron’s a ___________(fill in the blank) ….and
who is he to pass judgement…..
We are all
entitled to our opinions.
I am just being honest
and transparent….the way most of the entrepenuers I invest
are…
I wish the Angel community could have the
same integrity and values of the entrepenuer community, but
unfortunately I now believe that is hopeless and your actions prove
that.
What do you think the entrepenuers you have
funded are thinking right now.
This is despicable
and embarrassing for the tech community in my opinion.
Can
you learn from this ?
Please keep this confidential
even though I know that will be hard since two of you let your egos
take over and show Arrington how important you are by telling him
you were headed to a “secret” angel gathering.
Dave
McCLure…pls try not to blog about this and cause silicon valley
more embarrassment with your unprofessional classless
writings
Note: I did not include those who were at
the gatherings who I don’t know well enough to form an opinion
around their motives or values.
Tags: angelgate,
Ron
Conway
*******************************************************
Mnaficy>
David Hornik•2 years ago−
David,
Sorry to
disagree, but from an entrepreneur's perspective collusion is alive
and well among VCs. If you're ever interested, I can give you the
names of VCs who colluded to try to bring down the valuation of my
first company. Several witnesses to this event, including a very
well known lawyer in the valley.
-- Mariam Naficy, CEO &
Founder,
Minted.com
*************************************************************
From
Wikipedia: Collusion> Bruno Morency•
Collusion is an
agreement between two or more persons, sometimes illegal and
therefore secretive, to limit open competition by deceiving,
misleading, or defrauding others of their legal rights, or to obtain
an objective forbidden by law typically by defrauding or gaining an
unfair advantage.[citation needed] It is an agreement among firms to
divide the market, set prices, or limit production.[1] It can
involve "wage fixing, kickbacks, or misrepresenting the
independence of the relationship between the colluding parties".[2]
In legal terms, all acts effected by collusion are considered
void.[
**************************************************************
peter_voland@yahoo.com>
Dave McClure•
I have a company that could not get
any funding and we have been hurt exactly by such nepotistic and
jerk style actions. The valley is now the NEW VERSAILLES of crony
investment INCEST where you get the money most likley if you have
buddies in such f***** circles. Otherwise, they will invest in ANY
CRAP without merit as long as they have a BUDDY there. This is
DETRIMENTAL to innovation and fair level plane for EVERYONE and all
they do is CROSS deal and NOT invest in the best company according
to the tech/ideas merits. collusion, nepotistic crony based
intellectual incest. This SUCKS. I could give tangible examples
where 2 SAME companies get once 8million(just cos crony buddies
despite doing inferior job) and another gets nothing despite doing
superb job.
*******************************************
On
Self Importance and VC Arrogance. Read the extreme rationalizations
of of of the cartel members
below:
http://techcrunch.com/2010/09/26/angelgate-chris-sacca-responds-to-ron-conway/
AngelGate:
Chris Sacca Responds To Ron Conway
Michael
Arrington
Sunday, September 26th, 2010
As
I said the other day, there would be more private emails getting
published. This one is from Chris Sacca, a prominent “super angel”
who was not at the meeting I stumbled into but was at a previous
meeting. He wrote a response to the Ron Conway email. It’s worth
pointing out that this email is time stamped a good half hour before
our story broke, meaning he wrote it thinking it would all still
stay private.
This is also the first leaked email
we’ve received that actually includes names in the header of some
of the people who are involved in this mess. Presumably these were
the people Ron Conway emailed, but the header was stripped out of
that email when we received it. Like the Ron Conway email, we have
separately confirmed this email is authentic, although Sacca will
not comment on it.
I’ve removed one sentence from
the email that was highly sensitive. Nothing that material to the
overall message, but it was very personal and not appropriate to
print publicly.
The email:
From:
Christopher Sacca
Date: Thu, Sep 23, 2010 at 7:05
PM
Subject: Re: Super Angels Gathering
To: Ron
Conway
Cc: Josh Kopelman, Steve Anderson, Jeff Clavier,
Mike Maples, Dave McClure, David Lee
Ron,
I
agree with you that we all owe it to each other to be candid.
In
that spirit, I will say that I will always be grateful for the
opportunities you have given me in this business. You have shared
deals with me, introduced me to colleagues, and invited me to events
for years. Your philanthropy knows no bounds and has definitely
inspired my work with charity:water and Livestrong. In fact, I have
great respect for how you took my introducing you to will.i.am as an
opportunity to become the single most important benefactor to his
foundation. As I wrote last year before the Crunchies when I
endorsed you for Angel of the Year:
I mention
Ron last only because this one gets a little emotional for me. It
goes without saying, his prolific reach is legendary. He is the
Zelig of the startup world in that there isn’t a liquidity event
in our industry in which he isn’t involved and a closing dinner to
which he isn’t invited. Of course, he isn’t just invited as an
investor, but usually as the guy who made the introduction, helped
negotiate the terms, and saved it from the brink of disaster along
the way. It gets emotional for me because no one in this business
has been more generous, more selfless, or more caring with me. We
all learn from Ron, and none of us could be here without him. I will
never understand how he covers so much ground and how he manages to
be so responsive and perform so much service for others. When you
are with Ron, you know he will go to any length to help you. When
guys with his success might otherwise take time to rest, Ron then
redoubles his efforts for his charitable causes, not just giving
money, but raising funds and awareness and doing hard work on
non-profit boards. I feel lucky to know Ron and to have the chance
to work with him virtually every day as I am sure many of you do
too.
That said, I am having a hard time resolving
the person I quite literally grew up with in this business, with the
person who sent the email to which I am replying. Your anger and
personal accusations hurt, and it is clear they are intended to.
I
wasn’t in town for the second meeting, but I went to the first
dinner. I wish you would’ve been there. Not only would your input
have been valuable, but if you had attended, you would have seen
firsthand these topics of discussion:
1) Standard
docs to make financings cheaper for startups. The group talked about
who would be willing to pitch in our own money and time to help
draft a set of financing documents that would allow for priced
rounds to cost the same as convertible notes. As you know, it
usually costs 10-15 thousand dollars more to sell stock than issue a
note. Entrepreneurs would directly benefit from that work by lower
costs and less bullshit legal process to get a financing done. In
fact, it is exactly what YCombinator did in building a model
convertible note. I am sure you agree that would be a good thing for
founders everywhere if we were able to publish docs like this to the
public to be used as open source.
2) Pro-rata
rights. At the first dinner, we heard, from guys who have been doing
this for a long time, about the importance of securing pro-rata
rights for future rounds. This would allow them to continue to
invest alongside other investors at the new, higher, market price in
future rounds. I have no doubt you would agree that entrepreneurs
also benefit from having their early investors continue to stay
involved and demonstrate their renewed commitment to the company. I
know you would also love to be able to continue to invest in
companies beyond their seed round, and you also know this is only
ever helpful to your founders.
3) The futility of
VCs blocking company sales. We also discussed how pointless it was
for VCs to put clauses in deals that would prevent companies from
selling and how the guys in the room had never invoked such a clause
because doing so would create misalignment with their founders. We
identified that as one way in which many traditional VCs were just
missing the boat as to how to work with founders as peers and
collaborators and not put them on the opposite side of the table.
Each of us felt better knowing we weren’t alone in pushing back on
this term that very directly harms founders.
4)
Earliest stage founder cash-outs. Among efforts from others, we
talked about my recent projects to get very early stage founders
some liquidity. Traditional VCs have rarely been inclined to give
founders any ability to cash out claiming it makes them less
“hungry”. As someone who, just five years ago, had net worth of
exactly zero dollars, I remember the difference between being
“panicked” and “hungry”. As I have invested in more and more
companies, I have learned that many founders would benefit
dramatically from even the smallest amounts of cash (compared to the
overall deal size). I have worked hard to get my founders as little
as $25,000 to pay off credit cards and student loans. Or, in a small
deal that closed this week, I was able to get a founder the money so
he can pay for his wedding and not have to worry about taking on
debt. I, and the other investors in this group who do the same
thing, feel good about helping our founders in this way.
I
hope you can really pause to consider who is on this list you
mailed, as well as the others in the room you didn’t, and the way
they do business. All of us have considered you a mentor along the
way, and you have recognized that by collaboration with each of us.
Inspired by your service, we have seen each of our firms evolve to
continually try to always put founders first. Guys like Kopelman are
so painfully pro-entrepreneur, and so service-oriented to the
community of founders, one topic of discussion at our dinner was
understanding all of the different founder perks on which he has
spent his fund’s money. From the venture concierge and his hiring
services, to his CRM software and CEO summits, I haven’t seen
anyone add as much value to founders as First Round. I wish you
could have been there to experience firsthand the discussion about
how the rest of us could emulate more and more of that model. And,
like typical Josh, he was certainly willing to teach us his best
practices. I was so blown away, that I actually asked FR to lead a
deal I sourced recently because I knew they could serve the company
better than I could.
I know that each of the guys
on this list coaches entrepreneurs they aren’t even invested with
and continue to take time to help the entire startup ecosystem. They
work to get founders access to early betas that they know will help.
They call in favors to get costs down. They spend political capital
to bring in the best hires and they lose sleep brainstorming how to
solve problems. Each of the guys here takes phone calls and sends
emails at all hours of the day and night. Everyone here hustles.
Frankly, I find it hard to keep up with them, just like I can’t
keep up with you.
I told you last night that I
think some of this issue is worth discussing, even on stage. But,
this message, and the ferocity and ad hominem attacks that you
include, hurt. Both what you wrote to me before (calling this group
“dirtbags”) and in this message above. I am not sure why it
needed to get personal. In sharp contrast to your stereotyping about
what you say is obsession with talking about cars, I actually drive
a piece of shit truck with 115k miles, despite having been
frequently encouraged to visit Franz to buy a Mercedes. I fly coach
and I stay on friends’ couches in NYC and LA, not out of Signature
Aviation and at the Peninsula. That said, though I haven’t yet
made a buck, I sincerely hope I will. As I post clearly on my
website:
“We don’t think of ourselves as
money managers. That isn’t to say we aren’t tireless and
competitive. In fact, we are ruthless negotiators, aggressive
businesspeople, and have no allergy to disproportionately large
returns. However, frankly, capital just isn’t that important to
the early triumph of a company anymore.”
My
founders will tell you, as will the founders of everyone listed
here, that I/we sweat with these guys just like you do, bleed with
them just like you do, and try as hard as we can to put their
interests first. My founders stay at my house for team retreats. In
fact, I just bought an entirely new place for them to be able to
come to the woods, exercise, relax, focus, unwind, and bond with
each other. That came out of my pocket. They get overweight? I buy
them a mountain bike. They look skinny? I pick up groceries. Just
talk to them and I am sure you will see that, though each of us
investors adds value to our founders’ lives in different ways,
everyone on this thread adds value, Ron. Everyone. To claim that SV
Angel has a monopoly on adding value is disingenuous.
When
I started angel investing, my first deal was paid for with a credit
card check. It was a dumb idea, but I was so drawn to the notion
that I could be helpful to the team and I relished the chance to be
building something again. You and I were in that deal together and
we both made out pretty well. As you know, at Google, I didn’t get
rich by Silicon Valley standards. I left there worth less than a
million dollars. I started doing angel investing in part because you
and others like Coach Campbell encouraged me to and you knew I would
be good at it. I wrote checks to companies when it was financially
irresponsible for me to do so, then I went in there and busted my
ass to make those things succeed. My days have been driven by a
passion that makes it impossible for me to avoid the opportunity to
help. Right now, 94% of my net worth is tied up in startups and I
[REMOVED BY TECHCRUNCH]. I have every shred of my money alongside my
founders, often buying their same common stock. No one but an
obsessive idiot would ever allocate their money that way. But, I
love what I do. And I know that goes for everyone on this
list.
Kopelman bids his kids farewell every few
weeks to fly the redeye here and back to be with his companies. I
have watched Maples, Clavier, and Steve all drop what they are doing
to be supremely helpful to their founders and to their peers. Each
of them shares opportunities and leverages their network to try to
offer the best possible service to their companies’ teams. Sure,
McClure is loud and swears like a drunken sailor, but he takes
bullets for his guys, and his service to entrepreneurs through Geeks
on a Plane and his Startup 2 Startup dinners series is unparalleled.
His followings among founders make that clear. They love and respect
him, no matter how you may judge his writing style. They know they
have an ally in Dave.
I have seen guys on this
list, and in the larger group of all dinner attendees, repeatedly
back off terms or convince other investors to take haircuts
alongside them so deals can get done. Ask any single one of the
companies who has met with me and they’ll tell you that I always
negotiate against myself. To a fault. I have given back shares to
make room for hiring and I have talked other angels into waiving any
fiduciary arguments so our teams could stretch a small deal farther.
Everyone here has done that knowing we will get to work with those
entrepreneurs again in better times.
This group of
guys could all take a much easier path if they were just out to make
a buck. Everyone here could raise megafunds, bilk them for fees, jam
too much money into deals and repeat that process all over again
just mooching off the system. Instead, the folks you listed are all
your fellow pioneers in a new way of doing business, a way that
admits the structural change the industry has undergone. This is a
different era, and each of these guys knows that means greater
accountability than ever before.
I described on my
Lowercase site characteristics that I think apply to everyone on
this thread, and especially you, Ron:
We dive in to
work with teams that obsess over user experiences, customer
happiness, and that, to quote Paul Graham, “make something people
want.” Along with relatively small amounts of money, we give them
the time, attention, and the empathy that catalyze winning outcomes
for all involved. Rolling up our sleeves, we help design front
pages, invent new services, prioritize product features, negotiate
partnerships, and deal with the everyday professional and personal
challenges of startup life. We are grateful for the companies who
have chosen us, and feel lucky for the chance to collaborate with
such brilliant minds. The dealflow that comes to us is flattering,
and we are beyond thankful for the other individuals and firms with
whom we partner and learn from along the way.
It
makes me sad to hear you don’t think that is actually the case,
because I actually don’t doubt for a second that the guys on this
list all exceed the standard above. You know they do. You have
worked alongside them for years. You have broken bread with them.
You know who these people are and you know what their values are.
You have referred deals to all of them because you know the positive
impact they have on this industry. Now you are willing to throw that
away over second-hand accounts of what transpired at a dinner you
didn’t attend. I think you owe this group more than that. I also
think you owe the press and the founders who are reading the
accounts you have prompted more than that.
Ron, we
live in the age of Twitter. If we ever fucked an entrepreneur, or if
an entrepreneur even hinted we had fucked them, it would be
broadcast immediately and the resulting blog posts would be
permanently attached to a search on our names. Founders have never
been better educated or more empowered than they are today. We
aren’t giving them money; they are giving us the right to invest
in their companies. Our founders hire us and they do so after
consulting a rich network of datapoints confirming whether we are or
are not helpful. Slackers don’t get deal flow. Jerks don’t get
deal flow. Poseurs get left aside. Abuse the system once and you are
tattooed with shame.
Entrepreneurs outnumber us and
they talk more than we do. The good opportunities are more than any
of us can handle. There are legions of investors at the gates
hucking checks at today’s founders. The only possible way any of
us can stay in business is by serving. If we are not demonstrably
and materially helpful to entrepreneurs, we are dead.
Pausing
now to look back and re-read what you wrote, it just makes me sad
and your rush to judgment of people you called your friends is
disappointing. All of this goodwill burned with guys you have loved.
All of this time spent on an issue when we should be helping our
companies. (I am writing to you when I should be calling a founder
to help him weigh the demands of his VCs and a potential acquirer.)
All of this anger directed at people with whom you didn’t even
have a discussion to understand what was or wasn’t going on. I
wish you had been at those dinners. First, I am sure you would have
had helpful input. But, more importantly,you would have instead seen
your peers working, as they have always done, to cut through the
bullshit in this industry and continue to restore the purity and
honor a decade of misaligned interests has left here.
I
hope you will find some time over the next couple of days to chew on
all this, some time to reflect on who we all are and what we all do.
I hope you will spend a little time with our founders and ask them
how they feel about working with all of us. I hope you will work to
clear the air about what did or didn’t happen. You have such an
important voice. But, with that voice comes the responsibility to
investigate, know, and share the whole truth.
All
told, I know that the gratitude that this group has for your work in
this business can’t be undone with one vitriolic email. So, I am
optimistic that after you have a chance to chat with each of us, you
will remember the passion and selflessness that underpin the work
all of us do. While I deeply believe none of us could have gotten
here without you, I also ask that you respect that we have all
worked our asses off to be here. We all care, we all help, and we
all serve. We all learned much of that from you.
I
hope in time that will be clear once again and we can all get back
to helping our founders and each other.
Thank
you,
*****************************************************
http://37signals.com/svn/posts/1927-the-next-generation-bends-over
The
next generation bends over
Jason Fried wrote this on Sep
18 2009/
Mint’s sale to Intuit really pissed me
off.
Why should I care? Because I think it’s indicative
of a VC-induced cancer that’s infecting our industry and killing
off the next generation. I don’t know the full backstory, but I’d
bet this sale was encouraged by a Mint investor.
Here’s
a fresh new company that was gunning for an aging incumbent. And not
only gunning, but gaining. They had a great product, great design,
and great potential. They were growing rapidly and figured out the
revenue game. They were on their way to redefining an industry —
one that was left for dead by the current custodians.
They
were everything their main competitor, Intuit, was not. While Mint
was inventing, Intuit was out of it. People used Quickbooks/Quicken
out of habit and legacy. People used Mint because they loved it.
Intuit was disgruntled, Mint was disruptive.
But
here’s what happened: Intuit, last decade’s leader in personal
finance, just became the next decade’s leader in personal finance.
Mint had their number, but they sold it for $170 million. A big
payday for sure, and if that was their two-year goal then they
nailed it, but I can’t believe that was the point behind Mint. It
had too much potential.
Mint was a key leader of the next
generation of game changers. And now it’s property of Intuit —
the poster-child for the last generation. What a loss. Is that the
best the next generation can do? Become part of the old generation?
How about kicking the shit out of the old guys? What ever happened
to that?
As more great new companies are absorbed into
big old companies, a whole new generation of change is lost. They
can issue press releases saying how excited they are to be able to
bring their product to a whole new world of customers, and how their
new suitor will bring enormous resources to bear, but we know that’s
usually not really what happens. Development slows, products stall,
the staff that built the great stuff leaves, and mediocrity creeps
in. Not always, but usually.
Thomas Jefferson said
“Periodic revolution, ‘at least once every 20 years,’ was ‘a
medicine necessary for the sound health of government.’” That
may be even truer for business. We need new blood, new companies,
new methods, new ideas, new applications, and new leaders to
regenerate stale industries. The old must be plowed under by the
new.
But today it seems like the old is doing the
plowing. Let’s stop that. Let’s build great companies that are
here to fight, here to win, and here to stay until the next
generation after us comes along and kicks all our asses. And again
and again and again. That’s how better
happens.
******************************************