The nerds of Silicon Valley are all upset that these rich kids are taking over the industry that wants to be known for rewarding smarts and hard work over old money and connections. In The New York Times' DealBook, Evelyn M. Rusli chronicles the moneyed youth trying their hands at technology because, Hey, why not? "I wanted to build something," Mark Ghermezian, of the Canadian Ghermezian family, which owns the Mall of America among other big malls, told Rusli. "My family doesn’t quite understand what I do, but they know I’m their tech guy." But, even though money makes America, and especially Silicon Valley, go-round, the techies haven't taken kindly to the new high class class.
Silicon Valley has this whole meritocratic self-image that posits that smarts, innovation, and ingenuity, not money or social class will ultimately lead to success. The entire culture feeds off of that whole Winkelvoss (pictured above) versus Zuckerberg trope: The self-made man succeeds in the tech world. "No one really cares who your parents are," Mark Suster, a venture capitalist and TechStars mentor told Rusli. "My bigger point was that tech is a meritocracy and no one cares how rich your daddy is," venture capitalist David Hornick, who Rusli interviewed for the article, wrote on Twitter. Rich kids making an impact in tech sort of shatters this idea.
And the rich kids are indeed making an impact. Another heir, David Tisch (like the Tisch school, which was named in his grandfather Laurence's honor), now runs the New York version of TechStars. "Why is TechStars NYC run by a non-entrepreneur?" one skeptic, Matt Mireles, a chief executive of SpeakerText, asked. Since his appointment, the New York branch has done well, explains Rusli. "In one year, the New York program has become the accelerator’s most popular offshoot, attracting more than 1,500 applications for the spring class, almost double the year before and more than any other office," she writes. Another heir, Joshua Kushner, son of real estate magnate Charles Kushner, raised $40 million for his venture capital firm Thrive Capital, which invested in the popular eye glasses delivery service Warbey Parker, among other things.
"They’ll be judged by what they achieve," Suster said, but when they achieve, what will that say about Silicon Valley's great meritocratic society? Perhaps it's not as merit-based as the tech community would like to think. On the exclusionary end of things, Silicon Valley has few black or minority entrepreneurs, for example. "When we see extremely skewed demographics, we have very good reason to suspect that something is wrong with our selection process, that it’s not actually as meritocratic as it could be," wrote TechCrunch's Eric Ries last fall, after a CNN discussion of race and meritocracy. "And I believe that is exactly what is happening in Silicon Valley," he continued. It's not that the tech world means to exclude these populations, but as Ries explains, it's very easy for systems and cultures to have implicit biases. And, the rich kids, with their Ivy League educations -- Kushner went to Harvard undergrad and for his MBA and Tisch went to the University of Pennsylvania and NYU law -- have had a better time playing to these biases.
Also, did we mention these guys have a bunch of education? Sure, they had access to these institutions because of their status. But going to Harvard Business School doesn't hurt. It probably helps when it comes to proving their worth. "I thought, this guy is in oil and gas, what does he know about technology?" Bipul Sinha, a partner at venture capital firm Lightspeed Venture Partners told Rusli. "But then he started talking about the market, and I realized he was serious." Serious and smart and wealthy -- things that Silicon Valley likes very much.