Google fires top AI ethics researcher Margaret Mitchell

Google has fired Margaret Mitchell, the founder and former co-lead of the company’s ethical AI team. Mitchell announced the news via a tweet.

Google confirmed Mitchell’s firing in a statement to TechCrunch; Google said:

After conducting a review of this manager’s conduct, we confirmed that there were multiple violations of our code of conduct, as well as of our security policies, which included the exfiltration of confidential business-sensitive documents and private data of other employees.

In January, Google revoked corporate access from AI ethicist Margaret Mitchell for reportedly using automated scripts to find examples of mistreatment of Dr. Timnit Gebru, according to Axios. Gebru says she was fired from Google while Google has maintained that she resigned.

Earlier this month, Mitchell published the email she said she sent to Google’s press team the day her corporate email access was cut off. The email spoke about Gebru’s firing and how it appeared to be “fueled by the same underpinnings of racism and sexism that our AI systems, when in the wrong hands, tend to soak up.”

Mitchell’s letter, which you can read in full here, details the different ideas and structures at play that led to Dr. Gebru’s departure from Google. Mitchell argues what happened to Gebru “appears to stem from the same lack of foresight that is at the core of modern technology, and so itself serves as an example of the problem.”

Mitchell adds:

The firing seems to have been fueled by the same underpinnings of racism and sexism that our AI systems, when in the wrong hands, tend to soak up. How Dr. Gebru was fired is not okay, what was said about it is not okay, and the environment leading up to it was — and is — not okay. Every moment where Jeff Dean and Megan Kacholia do not take responsibility for their actions is another moment where the company as a whole stands by silently as if to intentionally send the horrifying message that Dr. Gebru deserves to be treated this way. Treated as if she were inferior to her peers. Caricatured as irrational (and worse). Her research writing publicly defined as below the bar.  Her scholarship publicly declared to be insufficient. For the record: Dr. Gebru has been treated completely inappropriately, with intense disrespect, and she deserves an apology. 

The letter went on to discuss the ethical artificial intelligence approach to developing technology, how Mitchell came to lead and then co-lead the ethical AI team with Gebru and what ultimately happened. Within the next year, Mitchell said she wanted “those of us in positions of privilege and power” to come to terms with “the discomfort of being part of an unjust system that devalued one of the world’s leading scientists, and keep something like this from ever happening again.”

Mitchell’s firing comes shortly after Google announced the appointment of Dr. Marian Croak to lead its responsible artificial intelligence division. When we reached out to Google yesterday the company did not have a comment on Mitchell’s fate.

Earlier today, Google internally announced the results of its investigation of Gebru’s exit, according to Axios. The company did not reveal what it found, but said it would implement some new policies to enhance diversity and inclusion at Google.

TechCrunch has reached out to Mitchell and will update this story if we hear back.

Block Party’s Tracy Chou will join us at TechCrunch Sessions: Justice on March 3

Tracy Chou’s resume is impressive. She interned at RocketFuel, Google and Facebook before becoming a software engineer at Quora and Pinterest. She is also a major advocate for diversity within the tech industry, launching Project Include in 2016.

Now, she’s the founder and CEO of Block Party, a platform aimed at making people feel safer on social media platforms.

Obviously, we’re absolutely thrilled to announce that we’ll be sitting down with Chou at TechCrunch Sessions: Justice in early March.

Block Party was born specifically out of Chou’s experience working at places like Quora — building a block button was one of the first things she built after being harassed on the platform. As an advocate for diversity, and a big name in the tech sphere in general, Chou has had her fair share of experience with online harassment.

Chou will join us as part of our Founders in Focus series, talking to us about the process of spinning up and launching Block party, as well as her strategies around growing the business. We’ll also talk through how Chou makes product decisions for a platform like Block Party, which tackles sensitive issues of safety and well-being.

Chou joins an outstanding cast of speakers at TC Sessions: Justice, including Arlan Hamilton, Brian Brackeen and a panel that includes the likes of Netflix’s Wade Davis and Uber’s Bo Young Lee.

The event goes down on March 3, and will explore diversity, equity and inclusion in tech, the gig worker experience, the justice system and more in a series of interviews with key figures in the technology community.

You don’t want to miss it. Get a ticket here.

Ex-General Catalyst and General Atlantic VC announces $68M debut fund

As of 2019, the majority of venture firms — 65% — still did not have a single female partner or GP at their firm, according to All Raise.

So naturally, anytime we hear of a new female-led fund, our ears perk up.

Today, New York-based Avid Ventures announced the launch of its $68 million debut venture capital fund. Addie Lerner — who was previously an investor with General Catalyst, General Atlantic and Goldman Sachs — founded Avid in 2020 with the goal of taking a hands-on approach to working with founders of early-stage startups in the United States, Europe and Israel.

“We believe investing in a founder’s company is a privilege to be earned,” she said.

Tali Vogelstein — a former investor at Bessemer Venture Partners — joined the firm as a founding investor soon after its launch and the pair were able to raise the capital in 10 months’ time during the 2020 pandemic.

The newly formed firm has an impressive list of LPs backing its debut effort. Schusterman Family Investments and the George Kaiser Family Foundation are its anchor LPs. Institutional investors include Foundry Group, General Catalyst, 14W, Slow Ventures and LocalGlobe/Latitude through its Basecamp initiative that backs emerging managers. 

Avid also has the support of 50 founders, entrepreneurs and investors as LPs — 40% of whom are female — including Mirror founder Brynn Putnam; Getty Images co-founder Jonathan Klein; founding partner of Acrew Capital Theresia Gouw and others.

Avid invests at the Series A and B stages, and so far has invested in Alloy, Nova Credit, Rapyd, Staircase, Nava and The Wing. Three of those companies have female founders — something Lerner said happened “quite naturally.”

“Diversity can happen and should happen more organically as opposed to quotas or mandates,” she added.

In making those deals, Avid partnered with top-tier firms such as Kleiner Perkins, Canapi Ventures, Zigg Capital and Thrive Capital. In general, Avid intentionally does not lead its first investments in startups, with its first checks typically being in the $500,000 to $1 million range. It preserves most of its capital for follow-on investments.

“We like to position ourselves to earn the right to write a bigger check in a future round,” Lerner told TechCrunch. 

In the case of Rapyd, Avid organized an SPV (special-purpose vehicle) to invest in the unicorn’s recent Series D. Lerner had previously backed the company’s Series B round while at General Catalyst and remains a board observer.

Prior to founding Avid, Lerner had helped deploy more than $450 million across 18 investments in software, fintech (Rapyd & Monzo) and consumer internet companies spanning North America, Europe and Israel. 

When it comes to sectors, Avid is particularly focused on backing early-stage fintech, consumer internet and software companies. The firm intends to invest in about 20 startups over a three-to-four year period.

“We want to take our time, so we can be as hands-on as we want to be,” Lerner said. “We’re not looking to back 80 companies. Our goal is to drive outstanding returns for our LPs.”

The firm views itself as an extension of its portfolio companies’ teams, serving as their “Outsourced Strategic CFO.” Lerner and Vogelstein also aim to provide the companies they work with strategic growth modeling, unit economics analysis, talent recruiting, customer introductions and business development support.

“We strive to build deep relationships early on and to prove our value well ahead of a prospective investment,” Lerner said. Avid takes its team’s prior data-driven experience to employ “a metrics-driven approach” so that a startup can “deeply understand” their unit economics. It also “gets in the trenches” alongside founders to help grow a company.

Ed Zimmerman, chair of Lowenstein Sandler LLP’s tech group in New York and adjunct professor of VC at Columbia Business School, is an Avid investor.

He told TechCrunch that because of his role in the venture community, he is often counsel to a company or fund and will run into former students in deals. Feedback from numerous people in his network point to Lerner being “extraordinarily thoughtful about deals,” with one entrepreneur describing her as “one of the smartest people she has met in a decade-plus in venture.”

“I’ve seen it myself in deals and then I’ve seen founders turn down very well branded funds to work with Addie,” Zimmerman added, noting they are impressed both by her intellect and integrity. “…Addie will find and win and be invited into great deals because she makes an indelible impression on the people who’ve worked with her and the data is remarkably consistent.”

Examining the ‘pipeline problem’

The tech industry has long grappled with an overwhelming lack of diversity among employees, executives, venture-backed founders, venture capital firms and board members. And despite recent efforts to increase diversity throughout the industry, tech still remains predominantly white and male.

Over the years, many have argued that the lack of diversity in tech is caused by a so-called pipeline problem: that there is little diversity in tech because there is not enough qualified talent from diverse backgrounds.

Today, there is well-established data that proves the lack of diversity in tech cannot be attributed to a pipeline problem, Uber Chief Diversity Officer Bo Young Lee told TechCrunch.

“If we want to claim that it’s a pipeline issue, we would first have to claim that we’ve hired what is available in the pipeline,” she said. “It’s not a pipeline issue as much as it is a recruiting process challenge.”

But the notion that there is a pipeline problem, despite the evidence showing there is not one, at least partly remains in the public psyche. Courri Brady, director at diversity, equity and inclusion consulting firm Paradigm, recognizes there are still some folks who have yet to rid themselves of the myth of the pipeline problem.

“There’s still a perception to some degree that there’s a pipeline problem within some companies that I’m personally supporting,” Brady told TechCrunch. “But there are a couple of dynamics at play. 

One of those dynamics, Brady said, pertains to recruiting processes, which are relatively fixed inside tech companies. 

If companies are convinced only certain schools, programs or other companies are the only places that produce good talent, and those people are not diverse, Brady said, “then those issues are going to perpetuate themselves.”


Dr. Joy Lisi Rankin, a research lead for gender, race and power in artificial intelligence at the AI Now Institute, is actively researching the history of the pipeline problem. In the next six months, the plan is to publish it as a report and potentially turn it into a book. Rankin was kind of enough to give TechCrunch a sneak peek into some of her research so far.

“The very high-level view is, people have been talking about a pipeline problem in some form since the seventies,” Rankin told me. “And before that, often, it was like a quote, manpower problem, by focusing on who has PhDs or master’s degrees in a field or who has elite jobs in a field. But that focus is always on individuals. It’s on tracking people, not institutions and not structures. So this is why I think it continues to be a convenient excuse for a host of sins, because talking about a pipeline makes it seem as if all things are equal in the United States, and we just have to find a way to keep people in. But the truth is, when we think about a STEM pipeline, we don’t talk about the fact that education in the United States is by no means equal from birth onwards.”

There are, of course, programs like Black Girls Code, Girls Who Code, Code.org and others that aim to step in to help introduce kids to technology. But these issues go deeper than just STEM education, Rankin said.

“For a long time, it was you had to have a certain SAT score to get in somewhere or a certain GRE score for graduate school,” Rankin said. “But we know, literally decades of research have shown SATs correlate in no way with how you’re going to do in college or how you might be as a student, but correlate everything with how wealthy your family is, which also then correlates with race and access to all other sorts of things like tutoring and etc. But that same time of credentialing pops up time and time again.”

The entire education system has historically functioned as a gatekeeper to knowledge through credentialing, she said.

“Credentialing is a form of gatekeeping and protecting who has access to power and who doesn’t,” she said. “There’s this term that I think was coined a few years ago about how Silicon Valley tech companies are not meritocracies, but ‘mirrortocracies,’ so you’re hiring people who have similar credentials to you, had the same sort of schooling, etcetera. But that doesn’t necessarily mean they’re more qualified. We know that all sorts of diversity often yields better work and better outcomes in a variety of situations, but focusing on certain types of quote, qualifications and credentials, don’t reflect that.”

Beyond education, however, there are also other pipelines at play. There’s the cradle to prison pipeline, which I’ve referred to as “the other pipeline,” as well as “the revolving door of H1B visa workers who are treated with lower status,” Rankin said.

“The pipeline is a way to silo all of that out and say, ‘we just need to get more Black women in tech,’ as opposed to saying, ‘actually, these companies are and have been racist and white supremacist and misogynist, and it’s those institutions and larger societal and global capitalist structures that need to change.”

What the idea of the pipeline also doesn’t capture is the fact that women were often tasked with doing manual computing in the 1950s and sixties, Rankin said. Back then, many considered coding to be a woman’s job.

“And it was only as it became clear how socially and economically and politically important that computing would be, that the profession over a decade or so became masculine. […] It clearly shows that as certain types of computing and programming became culturally valuable, more of those jobs that were better paying went to men. And it wasn’t that the work was any different but that because there was a prestige shift, there was also a shift in how it was gendered.”

Those are just some of the ideas Rankin will outline in her research paper, which she hopes will help to change the conversation happening in the tech industry about diversity, equity and inclusion. Instead of relying on the pipeline as an excuse, Rankin said she hopes the tech industry will focus more on inequities, structural racism, misogyny and how micro-inequities can lead to macro problems.

Rankin’s report will also have some recommendations, such as working to make education truly equitable and addressing surveillance, as well as the school to prison pipeline. She also believes salary data should be public information.

“As soon as we have more transparency around salaries, we can have more meaningful conversations,” she said.


Last week, former Pinterest employee Ifeoma Ozoma introduced legislation with the backing of California State Senator Connie Leyva to empower those who experience workplace discrimination and/or harassment. The Silenced No More Act (SB 331) would prevent the use of non-disclosure agreements in workplace situations involving all forms of discrimination and harassment.

“That’s certainly a step in the right direction,” Rankin said.

The proposed bill would expand the current protections workers have through the Stand Together Against Non-Disclosures Act, also authored by Leyva, that went into effect in 2019. Ozoma, along with former co-worker Aerica Shimizu Banks, came forward with claims of both racial and gender discrimination last year. They eventually settled with Pinterest, but the STAND Act technically only protected them for speaking out about gender discrimination. This new bill would ensure workers are also protected when speaking out about racial discrimination.

“It would be huge and not just for tech, but for your industry as well,” Ozoma told me earlier this week. “I believe that we don’t have real progress unless we approach things intersectionally and that’s the lesson from all of us.”

Meredith Whittaker, AI Now Faculty Director and co-organizer of the 2018 Google walkout, said this type of legislation absolutely necessary.

“From a structural perspective, it’s really evident we’re not going to change toxic, discriminatory tech environments without naming the problems,” Whittaker told TechCrunch. “We have decades of failed DEI PR, decades of people blaming the pipeline and decades of brilliant people like Ifeoma, Aerica and Timnit being harassed and pushed out of these environments. And oftentimes, people aren’t able to speak about their experiences so that the deep toxicity of these environments — the way it’s built into the structural operating procedures of these companies and workplaces — doesn’t get aired.”

There also needs to be more transparency around hiring and corporate recruiting, Rankin said. Pinterest, which was one of the first companies to set goals around diversity, disclosed last year that its hiring rates for women engineers, underrepresented minority engineers and underrepresented employees. But there’s room for even more transparency, like how many new hires come from those programs.

In Uber’s most recent diversity report, Uber talks about university recruiting, diversifying internship programs and more but the company’s reported data does not disclose how many hires came from those efforts.

Uber’s Bo Young Lee says the company is working on better tracking its top-of-funnel pipeline to ensure it’s representative of the available talent. This is called the Mansfield rule, which takes the Rooney Rule a couple of steps further. If Uber gets this right, then 14% of its recruiting pipeline would be Black and Hispanic, Lee said, citing a 2016 New York Times article about engineering graduates. It’s early days for Uber’s implementation of the Mansfield Rule, but the plan is to publish some of the data, Lee said. Though, she hasn’t yet decided exactly what that will look like.

Meanwhile, in Google’s latest diversity report, the company outlined how more than 1,300 women in Latin America were trained on web development and UX design with the help of Google volunteers and a Google.org grant. As a result, Google said 75% of the women who participated found jobs in tech. What Google did not mention, however, was how many women found jobs at Google.

In that same report, Google mentioned that it hired from 15 Historically Black College and Universities (HBCUs), 39 Hispanic-serving institutions and nine women’s colleges in the U.S. That all sounds good, but in December, former Google diversity recruiter April Curley came forward about how she was fired after she “became aware of all the racist shit put in place to keep black and brown students out of their pipeline.”

“We have a large team of recruiters who work incredibly hard to increase the hiring of Black+ and other underrepresented talent at Google, including a dedicated team that partners and strengthens our relationships with HBCUs,” a Google spokesperson said in a statement to TechCrunch. “This work is critical – in 2019 we welcomed graduates from 19 HBCUs and over the past decade, we’ve expanded our recruiting efforts to more than 800 schools. At the same time, we are absolutely committed to maintaining an inclusive and supportive workplace.  We don’t agree with the way April describes her termination, but it’s not appropriate for us to provide a commentary about her claims.”

Despite what may have happened at Google or what happens at other tech companies, it’s the overall lack of transparency around recruiting processes with which Rankin takes issue.

“It’s its own form of pipeline that is problematic and inequitable,” Rankin said. “[…] But how do you break down the scale of the problem so that it’s not just focusing on individuals.”

Rankin does not work inside tech companies and can’t speak to the inner workings of DEI departments, but said she does believe there are good people who are trying to make things better.

“I think this is a larger problem of education and perspective and how you can get to a point where you have an engineering degree or you get hired by a tech company and you’ve never had to think about race as a deeply rooted historical, structural problem,” she said. “[…] I think it’s convenient to disregard some of these larger issues and at some point, ignorance isn’t an excuse, especially given the events of the past few years.”

A Dallas-based founder looks to tackle the student loan crisis with his startup, College Cash

Demetrius Curry has spent the last couple years chasing a dream.

His startup, College Cash, allows brands to petition users to create photo and video marketing content highlighting their product or service, with the wrinkle being that content creators are paid by the brands in the form of credits that go directly toward paying down their student loan debt. This model awards the brands involved a level of social good will and tax benefits.

The Dallas-area founder was inspired to tackle the student loan debt crisis after talking with his daughter about the prospect of eventually paying down her own loan debt. Curry has spent the past two years building out the nascent platform, tracking down brand partners, navigating accelerator programs, enticing users and pounding the pavement to find investors willing to bet on his vision.

College Cash has raised $105,000 to date, and is hoping to eventually wrap the funding into a $1 million seed round.

Filling out the round has been its own challenge for Curry, who has struggled at times to find opportunity, even among historic levels of capital flowing into the startup ecosystem, a distinction that has been less noticeable for black founders that still make up just a small percentage of VC allocation. In the aftermath of last summer’s protests against police brutality, a number of venture capital firms issued statements decrying institutional racism and pledging to back more underserved founders, spinning up new programs for diverse founders.

Demetrius Curry, CEO of College Cash

While Curry says he appreciates the scope of the problem and the good intentions of those making the statements, he believes that venture capital networks still have a lot to learn about what being an “underserved” founder means, and that plenty of the existing efforts feel like “lip service.” He says that even as Silicon Valley continues to idolize dropouts from prestigious universities, stakeholders have less interest in recognizing the accomplishments of founders who fought their way through poverty or found opportunity in geographies where opportunities are harder to come by.

“You can’t look for something different if you’re looking in the same places,” Curry tells TechCrunch. “When you look at the topic of ‘underserved founders,’ it’s not only a skin color thing, it’s also about where they came from and what they’ve been through.”

Curry says that it can be frustrating to compete for early-stage opportunities when investors aren’t willing to meaningfully adjust their parameters. Of particular frustration to Curry has been navigating the world of “warm introductions” to even get a foot in the door for programs meant for diverse founders, or applying for early-stage programs geared toward the “underserved” only to be told that they weren’t far enough along to qualify.

“Think about how much we had to go through to even get in the room with you,” Curry says. “I’ve sold plasma to pay a web hosting fee, nothing is going to stop me.”

College Cash’s mission of expanding opportunities for people struggling to manage their student loan debt is personal to Curry, who saw his life turn around after going back to school.

Decades ago, fresh out of the military, Curry said he had a random conversation with a stranger while eating at a Hardee’s — the discussion about what more he wanted from life ended up pushing him to to go back and get his GED and later a business degree. What followed was a career in finance that eventually led toward his recent entrepreneurial pursuits with College Cash.

The platform is firmly an early-stage venture at the moment, but Curry has big ambitions he’s building toward. His next effort is building out a College Cash tipping integration with gig economy platforms, with the aim that users of those platforms could ultimately opt to tip a worker and route that money directly toward paying down that person’s student loan debt.

Curry says the team at College Cash has been working with a “national gig economy platform” to run a pilot of the integration and has run focus groups showing that users are more likely to tip when they know that money goes toward erasing loan debt.

Meet the entrepreneurs bringing bitcoin to institutions

There’s a popular misconception that the cryptocurrency industry is a realm of rogue tech-bro cowboys. But the reality is many of the most ambitious entrepreneurs in fintech are betting big on institutional bitcoin adoption. 

Such is the case with Lebanese-American venture capitalist Soona Amhaz of Volt Capital, whom Forbes recently listed as one of the most influential people in Silicon Valley. She discovered bitcoin through Reddit, back when she was an engineering student at the University of Michigan. Now her firm has invested in 11 crypto startups and is working alongside institutional players like TD Ameritrade, Cumberland and CMT Digital as part of the Chicago DeFi Alliance (CDA). 

“Where institutions are at now is they’re looking to back quality founders in the space early on. They’re looking to be market makers for a lot of these [crypto] projects, and they’re looking to help with integrations and partnerships between decentralized finance [DeFi] projects and more established financial firms,” Amhaz said. “They see where the puck is going and the smart ones are getting ahead of the curve.” 

When it comes to “DeFi,” Amhaz said the term includes bitcoin and the variety of blockchain-based systems gaining popularity among day traders during the pandemic.

Specific DeFi projects that are gaining more traction now include automated market makers (AMMs), stablecoins and platforms for decentralized exchange (DEX) aggregation, lending and derivatives,” Amhaz said. “Recent DeFi projects simply offer more avenues to use bitcoin as a productive asset, not just a reserve asset.” 

Until now, most institutions have preferred indirect exposure to cryptocurrency. Goldman Sachs alum Juthica Chou, who co-founded the derivatives exchange LedgerX back in 2013, pioneered the physically settled bitcoin futures that are now mainstay offerings among firms like Bakkt and CME Group. Futures contracts and bitcoin options offer a way for institutions to bet on the price of bitcoin without actually owning bitcoin directly. A cash-settled product means the buyer is paid in dollars, such as getting $10,000 when the option to buy at $10,000 expires, instead of getting paid in bitcoin. Rumor has it the asset management giant BlackRock will soon become the next player offering bitcoin futures products. 

So far, many institutions are willing to forgo some profits in exchange for lower risk. One of the most popular institutional product providers, Grayscale’s Bitcoin Trust (GBTC), reportedly saw $1.2 billion in fresh investor funds in January 2021. 

“I’m still bullish on options and derivatives,” Chou said, adding there’s enough demand from institutions for trust shares like GBTC, bitcoin options and even prospective exchange-traded funds (ETFs) to all generate substantial wealth in 2021. 

“The environment has way more infrastructure than we had back in 2013,” Chou said. “There’s security infrastructure and best practices for custodians, auditing infrastructure … banking is another great example. Compared to 2013, the difference between where we were and where we are today is night and day.”

With regards to GBTC, in particular, insatiable demand for shares with lower risks than custodying bitcoin leads to sky-high premiums, sometimes up to 100% more expensive than buying cryptocurrency directly. That’s why Valkyrie CEO Leah Wald launched her own Texas-based asset management firm in 2020. According to Crunchbase, she was one of roughly 800 women founders who raised capital last year. 

“It was really difficult to raise during a pandemic… not being able to organically expand my network,” Wald said. “I couldn’t have a meeting with someone even if I wanted to. And so much of seed investing is trusting in the team; trust built through high-quality, in-person conversations.”

Yet by January 2021, her startup had raised an undisclosed seed round from angel investors like Coinbase alum Charlie Lee, then applied to the Securities and Exchange Commission for permission to launch a bitcoin ETF. Chou said such a bitcoin ETF would boost the whole ecosystem because it would “open access for people who are already users brokers or securities services.”

Several ETF proposals have been rejected over the years, starting with a proposal by Tyler and Cameron Winklevoss in 2013. However, Wald says now she believes there’s never been better timing for an ETF to get approved. Among futures and options, trust shares and ETFs, all these products have different regulatory shapes that allow them to be redeemed faster, or traded in different ways, than the underlying asset, bitcoin, could be at-scale. Generally speaking, institutions seek indirect ways to gain exposure to these nascent, and often lucrative, crypto markets. 

“Bitcoin’s market cap has grown large enough that it may have finally surpassed an important threshold in the minds of the regulators,” Wald said. I believe the biggest reason the regulators were nervous about approving a bitcoin ETF in 2017 was concerns around custodial solutions and security. And I agree with that. We’re much closer to better security and custody now with institutional-grade options.” 

Wald added that both Valkyrie’s bitcoin trust shares and prospective ETF are structured to reduce volatility and premiums.  

“We wanted to create a more transparent product. I wanted our product to trade closer to the net asset value [NAV],” Wald said. “We’re the only bitcoin trust launching an ETF fund so everyday investors can buy exposure to bitcoin.”  

This propensity among women entrepreneurs using cryptocurrency isn’t restricted to American tech bubbles. According to Toya Zhang, head of marketing at the Hong Kong-based crypto and futures exchange AAX, women make up 25% of her platform’s users and a third of the top users. 

“Our biggest market is in Russia. Other than Russia, our biggest markets are Hong Kong, Korea, Indonesia and India,” Zhang said. “Asian women are more often the one to take care of finances. If you look at stock investment user groups in China and Hong Kong, women are more than half of them.”

The highly specialized crypto landscape is quickly gaining diversity, compared to other financial sectors. At India’s Coinswitch.co exchange, women reportedly make up 50% of around 25,000 users, depending on the specific region. Women also make up at least 40% of British cryptocurrency users, according to a survey by the crypto exchange Gemini

Across borders, the clear gender disparity may be associated with net worth rather than any lack of interest. In 2018, the World Bank estimated women only held 38% of capital wealth. Plus, Crunchbase tallied just 15,379 companies, less than 20% of startups that raised capital, that had women founders from 2009-2019. 

Beyond startups, there are also several companies like the New York Digital Investments Group (NYDIG), where women executives took the helm in order to innovate on established brokerage models. 

In December 2020, the insurance company Massachusetts Mutual Life Insurance Co. purchased $100 million in bitcoin and acquired NYDIG equity, a move that signaled a bullish outlook on institutional demand for bitcoin exposure in 2021. Then, on February 8, 2021, Elon Musk’s publicly traded car company Tesla validated the institutional thesis by buying $1.5 billion worth of bitcoin. 

“In 2021, the greater acceptance of bitcoin by traditional investors and allocators is really exciting,” said NYDIG president Yan Zhao. “We’ll give banks and wealth managers the ability to offer bitcoin products and exposure. We’ll handle the back end.”

Zhao said her bitcoin-focused firm has roughly $4 billion under management, including derivatives, and is currently courting prospective clients like private banks and various asset managers. Her firm is open to exploring ideas like a bitcoin ETF or trust shares, she said, but isn’t interested in Ethereum-based DeFi products. 

“We’ve made a conscious decision to focus on bitcoin,” Zhao said.

Likewise, Chou was skeptical about many of the Ethereum-based DeFi options available today, while remaining cautiously optimistic about the future of DeFi derivative options.

“Crypto-native products are important because that’s how you can really harness the power of not having centralized authorities involved to facilitate the transaction,” Chou said.

In short, now traditional options offer indirect access to cryptocurrency gains. At the same time, cryptocurrency itself is experimentally being used to offer comparable, yet more accessible, financial products. These DeFi products are designed for new functionality, not just price exposure. 

Meanwhile in California, from network scaling crusader Elizabeth Stark, CEO of Lightning Labs, to Amhaz at Volt Capital, the next generation of bitcoin whales may look remarkably different from Silicon Valley’s past unicorn-building bros. 

“The face of our industry looks different than how the tech industry looked in the early 90s or how finance has looked since forever,” Amhaz said. “We’re starting at a higher, more informed baseline. So, although there’s still work to be done here, I’m optimistic.”

Disclosure: Together, Leah Wald and Leigh Cuen are volunteer co-founders of the Digital Salon Initiative.

 

Meet the entrepreneurs bringing bitcoin to institutions

There’s a popular misconception that the cryptocurrency industry is a realm of rogue tech-bro cowboys. But the reality is many of the most ambitious entrepreneurs in fintech are betting big on institutional bitcoin adoption. 

Such is the case with Lebanese-American venture capitalist Soona Amhaz of Volt Capital, whom Forbes recently listed as one of the most influential people in Silicon Valley. She discovered bitcoin through Reddit, back when she was an engineering student at the University of Michigan. Now her firm has invested in 11 crypto startups and is working alongside institutional players like TD Ameritrade, Cumberland and CMT Digital as part of the Chicago DeFi Alliance (CDA). 

“Where institutions are at now is they’re looking to back quality founders in the space early on. They’re looking to be market makers for a lot of these [crypto] projects, and they’re looking to help with integrations and partnerships between decentralized finance [DeFi] projects and more established financial firms,” Amhaz said. “They see where the puck is going and the smart ones are getting ahead of the curve.” 

When it comes to “DeFi,” Amhaz said the term includes bitcoin and the variety of blockchain-based systems gaining popularity among day traders during the pandemic.

Specific DeFi projects that are gaining more traction now include automated market makers (AMMs), stablecoins and platforms for decentralized exchange (DEX) aggregation, lending and derivatives,” Amhaz said. “Recent DeFi projects simply offer more avenues to use bitcoin as a productive asset, not just a reserve asset.” 

Until now, most institutions have preferred indirect exposure to cryptocurrency. Goldman Sachs alum Juthica Chou, who co-founded the derivatives exchange LedgerX back in 2013, pioneered the physically settled bitcoin futures that are now mainstay offerings among firms like Bakkt and CME Group. Futures contracts and bitcoin options offer a way for institutions to bet on the price of bitcoin without actually owning bitcoin directly. A cash-settled product means the buyer is paid in dollars, such as getting $10,000 when the option to buy at $10,000 expires, instead of getting paid in bitcoin. Rumor has it the asset management giant BlackRock will soon become the next player offering bitcoin futures products. 

So far, many institutions are willing to forgo some profits in exchange for lower risk. One of the most popular institutional product providers, Grayscale’s Bitcoin Trust (GBTC), reportedly saw $1.2 billion in fresh investor funds in January 2021. 

“I’m still bullish on options and derivatives,” Chou said, adding there’s enough demand from institutions for trust shares like GBTC, bitcoin options and even prospective exchange-traded funds (ETFs) to all generate substantial wealth in 2021. 

“The environment has way more infrastructure than we had back in 2013,” Chou said. “There’s security infrastructure and best practices for custodians, auditing infrastructure … banking is another great example. Compared to 2013, the difference between where we were and where we are today is night and day.”

With regards to GBTC, in particular, insatiable demand for shares with lower risks than custodying bitcoin leads to sky-high premiums, sometimes up to 100% more expensive than buying cryptocurrency directly. That’s why Valkyrie CEO Leah Wald launched her own Texas-based asset management firm in 2020. According to Crunchbase, she was one of roughly 800 women founders who raised capital last year. 

“It was really difficult to raise during a pandemic… not being able to organically expand my network,” Wald said. “I couldn’t have a meeting with someone even if I wanted to. And so much of seed investing is trusting in the team; trust built through high-quality, in-person conversations.”

Yet by January 2021, her startup had raised an undisclosed seed round from angel investors like Coinbase alum Charlie Lee, then applied to the Securities and Exchange Commission for permission to launch a bitcoin ETF. Chou said such a bitcoin ETF would boost the whole ecosystem because it would “open access for people who are already users brokers or securities services.”

Several ETF proposals have been rejected over the years, starting with a proposal by Tyler and Cameron Winklevoss in 2013. However, Wald says now she believes there’s never been better timing for an ETF to get approved. Among futures and options, trust shares and ETFs, all these products have different regulatory shapes that allow them to be redeemed faster, or traded in different ways, than the underlying asset, bitcoin, could be at-scale. Generally speaking, institutions seek indirect ways to gain exposure to these nascent, and often lucrative, crypto markets. 

“Bitcoin’s market cap has grown large enough that it may have finally surpassed an important threshold in the minds of the regulators,” Wald said. I believe the biggest reason the regulators were nervous about approving a bitcoin ETF in 2017 was concerns around custodial solutions and security. And I agree with that. We’re much closer to better security and custody now with institutional-grade options.” 

Wald added that both Valkyrie’s bitcoin trust shares and prospective ETF are structured to reduce volatility and premiums.  

“We wanted to create a more transparent product. I wanted our product to trade closer to the net asset value [NAV],” Wald said. “We’re the only bitcoin trust launching an ETF fund so everyday investors can buy exposure to bitcoin.”  

This propensity among women entrepreneurs using cryptocurrency isn’t restricted to American tech bubbles. According to Toya Zhang, head of marketing at the Hong Kong-based crypto and futures exchange AAX, women make up 25% of her platform’s users and a third of the top users. 

“Our biggest market is in Russia. Other than Russia, our biggest markets are Hong Kong, Korea, Indonesia and India,” Zhang said. “Asian women are more often the one to take care of finances. If you look at stock investment user groups in China and Hong Kong, women are more than half of them.”

The highly specialized crypto landscape is quickly gaining diversity, compared to other financial sectors. At India’s Coinswitch.co exchange, women reportedly make up 50% of around 25,000 users, depending on the specific region. Women also make up at least 40% of British cryptocurrency users, according to a survey by the crypto exchange Gemini

Across borders, the clear gender disparity may be associated with net worth rather than any lack of interest. In 2018, the World Bank estimated women only held 38% of capital wealth. Plus, Crunchbase tallied just 15,379 companies, less than 20% of startups that raised capital, that had women founders from 2009-2019. 

Beyond startups, there are also several companies like the New York Digital Investments Group (NYDIG), where women executives took the helm in order to innovate on established brokerage models. 

In December 2020, the insurance company Massachusetts Mutual Life Insurance Co. purchased $100 million in bitcoin and acquired NYDIG equity, a move that signaled a bullish outlook on institutional demand for bitcoin exposure in 2021. Then, on February 8, 2021, Elon Musk’s publicly traded car company Tesla validated the institutional thesis by buying $1.5 billion worth of bitcoin. 

“In 2021, the greater acceptance of bitcoin by traditional investors and allocators is really exciting,” said NYDIG president Yan Zhao. “We’ll give banks and wealth managers the ability to offer bitcoin products and exposure. We’ll handle the back end.”

Zhao said her bitcoin-focused firm has roughly $4 billion under management, including derivatives, and is currently courting prospective clients like private banks and various asset managers. Her firm is open to exploring ideas like a bitcoin ETF or trust shares, she said, but isn’t interested in Ethereum-based DeFi products. 

“We’ve made a conscious decision to focus on bitcoin,” Zhao said.

Likewise, Chou was skeptical about many of the Ethereum-based DeFi options available today, while remaining cautiously optimistic about the future of DeFi derivative options.

“Crypto-native products are important because that’s how you can really harness the power of not having centralized authorities involved to facilitate the transaction,” Chou said.

In short, now traditional options offer indirect access to cryptocurrency gains. At the same time, cryptocurrency itself is experimentally being used to offer comparable, yet more accessible, financial products. These DeFi products are designed for new functionality, not just price exposure. 

Meanwhile in California, from network scaling crusader Elizabeth Stark, CEO of Lightning Labs, to Amhaz at Volt Capital, the next generation of bitcoin whales may look remarkably different from Silicon Valley’s past unicorn-building bros. 

“The face of our industry looks different than how the tech industry looked in the early 90s or how finance has looked since forever,” Amhaz said. “We’re starting at a higher, more informed baseline. So, although there’s still work to be done here, I’m optimistic.”

Disclosure: Together, Leah Wald and Leigh Cuen are volunteer co-founders of the Digital Salon Initiative.

 

Fired GitHub employee who warned co-workers about Nazis is seeking legal counsel

On the day a violent mob of Trump supporters stormed the U.S. Capitol, a worried GitHub employee warned his co-workers in the D.C. area to be safe.

After making a comment in Slack saying, “stay safe homies, Nazis are about,” a fellow employee took offense, saying that type of rhetoric wasn’t good for work, the former employee told me. Two days later, he was fired, with a human relations representative citing a “pattern of behavior that is not conducive to company policy” as the rationale for his termination, he told me.

In an interview with TechCrunch, the now-former employee said he was genuinely concerned about his co-workers in the area, in addition to his Jewish family members. 

TechCrunch agreed to keep the identity of the terminated employee confidential due to fears of his and his family’s safety.

As Business Insider first reported, his firing led to employees circulating an internal letter asking GitHub to denounce white supremacy and Nazis. The employees also wanted answers about his firing. That led to GitHub CEO Nat Friedman telling employees the company would investigate the termination of the employee.

Now, the terminated employee says he is currently seeking counsel to ensure his family is protected, as well as figure out if he can receive damages or some other form of reconciliation. The fired employee said GitHub has reached out to him for help in the internal investigation, but is waiting to engage with the company until he has legal representation in place.

Still, he said he is not optimistic about the investigation. 

“I am 90% sure it’s not genuine,” the terminated employee said of Friedman’s response. “This type of stuff had been said before. It happened with the ICE stuff where the company said let’s have discussions but then if you mention ICE, you get fired. I used to believe in this company, but now I don’t.”

Similar to what some employees are asking, the terminated employee sees this as an opportunity for GitHub to take a stance on white supremacy.

He said, “I feel like this could be an opportunity for GitHub to really do a purge and say ‘Do we want white supremacists at this company and how do we get Black leaders into executive management?’ ”

The latter is something he said he’s been asking for since he joined GitHub. But as he kept talking about the lack of diversity at the leadership level, he said he found his job at risk.

“When I kept talking about it, I got threatened being fired in October,” he said. “Both my managers had to come completely to my defense and beg them not to fire me when I pointed out how the sales team maybe has just two people of color.”

In a blanket statement to TechCrunch about the contents of this article, a GitHub spokesperson said:

We take all complaints of this nature very seriously. We are actively investigating the situation.

Upon his termination, the former employee said the company gave him two paychecks and sent him on his way. He said he would be open to some form of reconciliation, whether in the form of damages, healthcare coverage or something else. While he’s not looking for his job back, he says he would like to see more worker power at GitHub. 

“If I had a magic wand, I’d love for the employees at GitHub to be able to have a union and represent people from marginalized communities,” he said.

 

Facebook hires a VP of civil rights

Facebook has hired Roy Austin to become its first-ever VP of Civil Rights and Deputy General Counsel to create a new civil rights organization within the company, Facebook announced today. Austin is set to start on January 19 and will be based in Washington, DC.

Austin most recently served as a civil rights lawyer at Harris, Wiltshire & Grannis LLP. Prior to that, Austin co-authored a report on big data and civil rights and worked with President Barack Obama’s Task Force on 21st Century Policing.

“I am excited to join Facebook at this moment when there is a national and global awakening happening around civil rights,” Austin said in a statement.

Roy Austin, Facebook’s new VP of Civil Rights. Image Credits: Facebook 

“Technology plays a role in nearly every part of our lives, and it’s important that it be used to overcome the historic discrimination and hate which so many underrepresented groups have faced, rather than to exacerbate it. I could not pass up the opportunity to join a company whose products are used by so many and which impacts the civil rights and liberties of billions of people, in order to help steer a better way forward.”

It’s not clear what the goals or responsibilities of the civil rights organization within Facebook will be, but we’ve reached out to Facebook for more information. In the meantime, here’s what Facebook’s Chief General Counsel Jennifer Newstead said on the company blog:

I am delighted to welcome Roy to Facebook as our VP of Civil Rights. Roy has proved throughout his career that he is a passionate and principled advocate for civil rights — whether it is in the courtroom or the White House. I know he will bring the same wisdom, integrity and dedication to Facebook. It’s hard to imagine anyone better qualified to help us strengthen and advance civil rights on our platform and in our company.

In July, former ACLU director Laura W. Murphy released the results of the multiyear investigation and civil rights audit of Facebook. The report highlights some progress, such as Facebook changing its policy on discriminatory housing and employment ads, expanding its voter suppression policies and having more frequent meetings with civil rights leaders. But the auditors still raised a number of concerns, many of which pertained to the 2020 U.S. election and President Trump.

In light of a pro-Trump mob storming the U.S. Capitol last week, Facebook CEO Mark Zuckerberg blocked Trump from both Facebook and Instagram at least through the inauguration of President-elect Joe Biden.

Mixtape podcast: Behind the curtain of diversity theater

It’s fair to say that most people have heard about diversity reports. And it’s probably also fair to say that most of us have watched, sometimes with a metaphorical bucket of buttered popcorn, as companies crisis-comms their ways out of … crises. But most of us do not know what goes on behind the scenes.

Mark S. Luckie has an idea. The digital strategist, journalist and author of “The Digital Journalist’s Handbook” and “DO U,” has written “Valley Girls,” a fictional portrayal of life behind the social curtain at popular tech company Elemynt. Particularly the journey of main character Kelsey Pace, as she navigates life as a communications manager for the company. Having worked in strategy and partnership positions at Facebook, Twitter and Reddit, Luckie tells us he was most interested in exploring how the actual conversations about diversity work inside of tech companies.

Valley Girls Author Mark S. Luckie

Mark S. Luckie

“The most that people the most insight that people have is diversity reports, which of course are published from the tech companies, but not an idea of ‘Okay, what’s really going on?’ And so that’s what ‘Valley Girls’ aims to explore — what’s really going on? How bad is diversity? What are the things that are happening or not happening? What is the employee attitude towards it? One of the big narratives is what are the contentions between employees and executives to actually furthering diversity within these companies?”

Tech watchers will read “Valley Girls” and perhaps be able to identify what company drama he is referring to when he mentions this Congressional hearing or that anonymous memo. This, Luckie says, was on purpose.

“It is a merging of the narratives. So yeah, anyone who follows tech or works around tech will be able to … say, ‘Okay, this reminds me of this, it reminds me of this.’ And because like I said, all these experiences are not isolated from each other. They’re woven into each other.”

With “Valley Girls,” Luckie says he wanted to explore the personal conflict that can emerge while working at one of these companies. He did that and more.

Click play above to hear more about the book, due out this month, and what he heard about the reactions from some in Silicon Valley.