SAN FRANCISCO — Peter Thiel once chastised the media for taking Donald Trump at his word during the presidential campaign. With respect to banning Muslims from the country or erecting a wall on the U.S.-Mexico border, the billionaire investor and Trump ally cautioned not to take the GOP candidate “literally.”
Now the PayPal co-founder is seeing his words come back to haunt him. Over the last week, the new administration has issued executive orders to temporarily ban immigrants, refugees and visitors from seven Muslim-majority countries and pushed ahead to build a border wall.
As many across the country erupted in protest over the weekend, critics — from entrepreneur Mark Cuban to former Reddit chief executive Ellen Pao — lambasted Thiel on Twitter and called on him to retract his comments. Some of his Silicon Valley peers, who spoke on condition of anonymity because their deliberations were private, are considering holding off on doing deals with Thiel's prominent venture capital firm, Founders Fund, while several entrepreneurs said they had decided they would not seek to raise money from the firm.
Even one of Thiel’s closest proteges wondered aloud if Thiel regretted his words. “I would imagine [Peter] would have to look at this and say there is a literal interpretation that also turned out to be the case,” Sam Altman, the 31-year-old president of the Silicon Valley start-up incubator and fund Y-Combinator, said in an interview Sunday. Thiel is a part-time partner at the fund and gave Altman millions of dollars to help launch his career as an investor.
In Silicon Valley, Thiel, 49, was one of the few backers of Trump, and certainly the highest profile. He co-founded PayPal, serves on Facebook's board of directors and founded the data-mining start-up Palantir. Since the election, his contrarian bet on Trump has helped him gain access to the president's inner circle.
Although there is widespread frustration among Thiel's peers for his support of Trump, the criticism has yet to turn into a groundswell of protest. Silicon Valley functions because of tightly-knit relationships, and only a few have been willing to publicly voice their criticism of Thiel for fear of alienating one of the region's most powerful players, executives said. Some said they were struggling with a quandary: the value of having one’s own seat at the table versus punishing Thiel for collaborating with an administration that is increasingly seen as hostile to values that are widely held in the region. Others said that there was not much use in pressuring Thiel, who revels in being a contrarian.
Thiel spokesman Jeremiah Hall did not respond to repeated requests for comment on this article. In a statement emailed to reporters, Hall said, “Peter doesn't support a religious test, and the administration has not imposed one.”
Thiel has been instrumental in helping Silicon Valley break the ice with Trump, and the question now is whether that effort can continue. In December, Trump invited leaders of major technology companies for a meeting at Trump Tower in New York City. The gathering was seen as an olive branch after a bitter campaign in which the industry overwhelmingly sided with Democrat Hillary Clinton. It was also evidence of the balancing act that tech leaders face as they weigh the value of the bottom line — and the need for government support in protecting it — against taking political and public stances against Trump, said venture capitalist Hunter Walk.
“There were sections of the tech community willing to take a ‘wait and see’ stance post-election, hoping that perhaps the president's initial focus would shift toward a dialogue around job creation, climate change and other pressing issues,” said Walk. But a line has been crossed, he said. “In the week since inauguration, President Trump has shown us all he should be taken both literally and seriously.”
In the wake of the immigration ban, the relationship with Silicon Valley has reached a new low. The tech world is heavily dependent on high-skilled immigrant labor, and technology leaders were among the first to strongly denounce the immigration ban.
Apple chief executive Tim Cook and Tesla Motors chief executive Elon Musk, who both attended the Trump Tower meeting, were among those who condemned the administration's actions. Cook quoted the Rev. Martin Luther King Jr. and said that Apple would not exist without immigration (Apple co-founder Steve Jobs was the son of a Syrian immigrant).
Executives such as former Google executive Tony Fadell, the venture capitalist Chris Sacca and Slack chief executive Stewart Butterfield competed over the weekend with one another on Twitter to match donations to the American Civil Liberties Union.
A few executives, including Cuban, Pao and others, took direct aim at Thiel.
Pao tweeted, “Peter Thiel is a [expletive] fool,” over the weekend, with a link to an article with the same headline.
John Lilly, a partner at the venture firm Greylock Capital, where Thiel's PayPal co-founder Reid Hoffman also works, tweeted a response to Thiel's spokesman's assertion that the Muslim ban was not a religious test. “On this one, we'll go back to Peter's own words: not a literal ban. But a serious one.”
Altman, who called on the technology community to take a stand against the ban in a widely circulated blog post on Saturday, previously said he will not cut ties with Thiel, arguing that political differences should not be cause to sever professional relationships.
In Sunday’s interview, Altman said the two hadn’t spoken recently. “I have been busy, and he has been busy,” he said.