Federal regulators bailed out Silicon Valley Bank depositors over the weekend after the bank collapsed, threatening nearly half of all U.S. venture-backed tech startups in the U.S. who depended on it.
The bailout has been criticized by some including Republican lawmakers who say it benefits the rich at the expense of the poor, while Democratic lawmakers blame the bank failure on a Trump-era rollback of consumer protection.
The Federal Reserve Board, Treasury Department and Financial Deposit Insurance Corporation (FDIC) announced Sunday what amounts to a bailout for customers of SVB, saying that depositors will be made whole, including deposits over the traditional FDIC insurance limit of $250,000.
By saving the ecosystem from collapse, the government is protecting the startup portfolios and investment funds of the ultra-rich to the tune of billions of dollars.
Here are 10 Silicon Valley billionaires and millionaires who were indirectly bailed out by the Biden administration and U.S. government.
Founded in Silicon Valley in 2009 by Marc Andreessen and Ben Horowitz, Andreessen Horowitz — or a16z — is a venture capital firm that backs tech entrepreneurs at all stages. A16z has $35 billion in assets under management across multiple funds.
Andreessen’s real-time net worth is estimated by Forbes to be $1.7 billion.
A Facebook board member since 2008, the billionaire venture capitalist met with then-Sen. Barack Obama in early 2007 for an interview and concluded that Obama wasn’t a radical and would not be a threat in the power shift to Silicon Valley.
“This is not some kind of liberal revolutionary who is intent on throwing everything up in the air and starting over,” Andreessen wrote. Obama’s policy positions struck Andreessen as “reasonable, moderate, and thoughtful … what comes across — in both his questions and his answers — is calmness, reason, and judgment.”
Andreessen wrote in a blog that his only involvement with the Democratic presidential campaign was as an individual donor until meeting with Obama. Then Andreessen and his wife both contributed the maximum they could to the Obama campaign — less than $10,000 total for both the primary and the general election.
In 2022, Andreessen was criticized for advocating against the construction of 131 multifamily housing units in his Atherton, California neighborhood, saying he opposed permitting more than one house per acre of land. He was accused of hypocrisy because he had previously argued for increasing the housing supply in California.
Investor John Doerr is a venture capitalist and chairman of venture capital firm Kleiner Perkins in Menlo Park, California. The company has an estimated net worth of at least $322 million as of March 5, 2023.
Forbes estimates Doerr’s real-time net worth at $9.1 billion
Doerr joined Kleiner Perkins in 1980 after working at Intel and co-founding two companies. He famously led the company to invest $12.5 million in Google in 1999 and was also an early investor in Amazon, DoorDash, Slack and more, Forbes reported.
In February 2009, Doerr was appointed a member of President Obama’s Economic Recovery Advisory Board to provide the Obama administration with advice and counsel during the financial crisis.
Doerr donated up to $1 million to the Obama Foundation, according to the Observer.
Doerr’s name is tied to inequality for many women. In 2012, Ellen Pao, a former Kleiner Perkins employee, filed a gender discrimination suit against the firm alleging a widespread and long-term pattern that led to her being denied promotions and compensation and ultimately, her her job.
In defending his company against the gender discrimination lawsuit, Doerr famously said the greatest tech entrepreneurs are “white, male, nerds.”
With an estimated net worth of $1.5 billion, San Francisco-based angel investor Ron Conway is the founder and co-managing partner of SV Angel. He was an early-stage investor in Airbnb, GitHub, Poshmark and Zenefits, among others, making a large number of deals at relatively low ownership — a “spray and pray” approach, Forbes reported. Conway launched Start Fund in 2011 to focus on funding Y Combinator startups and he is the former CEO of Personal Training Systems (acquired by SmartForce/SkillSoft). He also led Altos Computer Systems to an IPO in 1982.
SV Angel has less than $150 million in assets under management, according to an undated report in PrivateFundData.com.
Conway has been a supporter of gun control, lobbying for immigration reforms and tech innovation.
A tech entrepreneur and co-founder and general partner at venture capital firm Andreessen Horowitz (a16z), Ben Horowitz has an estimated net worth of $3.6 billion, according to Growth Hackers. He worked with Marc Andreessen at Netscape, then cofounded Opsware (formerly Loudcloud), which they sold to HP in 2007 for $1.6 billion, according to Forbes.
Horowitz is the author of two bestselling books, “The Hard Thing About Hard Things” and “What You Do Is Who You Are.” He created the a16z Cultural Leadership Fund to advance young Black entrepreneurs to enter in tech and connect tech startups with cultural leaders.
With a Forbes real time net worth of $5.4 billion, Italian immigrant doug Leone likes to invest in entrepreneurs from humble backgrounds. He started his tech career at Sun Microsystems, a firm cofounded by billionaire venture capitalist, Vinod Khosla, before eventually joining Sequoia Capital in 1988, and worked his way up to global managing partner in 2012.
In 2017, Forbes named Leone a Top 10 U.S. tech investor.
Leone supported former President Donald Trump‘s 2020 re-election campaign and was appointed to Trump’s task force on re-opening the economy in the wake of the covid pandemic. In 2021, Leone renounced his support for Trump after the January 6 Capitol insurrection.
He stepped aside in 2022 from some of his duties at Sequoia while remaining general partner. As of 2022, Sequoia had $85 billion in assets under management.
With an estimated net worth of $169.07 million, South Africa-born Roelof Botha replaced Doug Leone in 2022 as senior steward of Sequoia Capital’s global brand and operations. Both moved to the U.S. from South Africa in the late 1990s and earned an MBA from the Stanford University Graduate School of Business. Before graduation from Stanford, he became director of corporate development for PayPal in 2000. Botha left PayPal to join Sequoia in January 2003, where he oversaw the firm’s investment in YouTube, Instagram, and Square, among others. Botha has led or co-led Sequoia’s investments in several early and growth-stage companies.
Botha’s grandfather was Roelof Frederik “Pik” Botha, a South African politician who served as the country’s last apartheid-era foreign minister and the first minister of Mineral and Energy Affairs under Nelson Mandela.
The president of arguably the best-known startup accelerator, Y Combinator, Garry Tan is the son of Singaporean immigrants to California. He studied computer systems engineering at Stanford University from 1999 to 2003, then went to work at Microsoft and then at Palantir Technologies. In 2008 Tan started his own enterprise with Brett Gibson — a blogging platform called Posterous that allowed users to write blogs that automatically posted to Flickr, Twitter, and Facebook simultaneously. Twitter acquired Posterous in 2012 for $20 million, 24-7 Crypto reported.
Tan joined the startup accelerator Y Combinator, which provides funding for early-stage startups and helps develop their pitch to investors. He was a partner at YC and became president of YC in January 2023.
In 2012, Tan founded venture capital fund Initialized Capital. As managing partner, he grew the company to $3.2 billion in assets under management and startups worth more than $200 billion in market value in 10 years. A major investor in crypto exchange Coinbase, he has since made back more than 400 percent of his initial $600,000 investment. Tan turned his Coinbase bet into a $680 million ”golden ticket,” Forbes reported in 2021. There appears to be no 2023 update on Tan’s present-day net worth.
Tan supports affordable housing, the YIMBY (Yes, in my back yard) movement, homeless shelters and market-rate housing, and has donated to groups such as the San Francisco Bay Area Renters’ Federation, YIMBY Action, and YIMBY Law.
Chase Coleman, III, the New York-based founder of Tiger Global Management, has an estimated real-time Forbes net worth of $8.5 billion. Coleman may not be based in Silicon Valley, but the tech investor epitomized the Silicon Valley startup mania of 2021, backing more startup deals than any other U.S. firm for the year, sometimes within hours of meeting with founders, Wall Street Journal reported.
Coleman started out as a hedge fund investor, but Tiger Global evolved into a broader investment firm overseeing $75 billion in assets with venture capital its biggest unit. Tiger Global’s hedge fund returned 21 percent annually for its first 20 years but fell more than 50 percent in the first half of 2022.
According to Business Insider, Coleman was born into “old money” and has made a lot of “new money” as well.
South Africa-born tech investor David Sacks moved to the U.S. with his family when he was 5, and wanted to be like his grandfather, who had started a candy factory. Sacks earned a B.A. in economics from Stanford University in 1994 and a law degree from the University of Chicago Law School in 1998.
Sacks was the founding chief operating officer and product leader of PayPal and founder/CEO of Yammer before becoming general partner at venture capital fund Craft Ventures, which he co-founded in 2017. Carft is an early-stage venture fund, and his angel investments include Facebook, Uber, SpaceX, Palantir Technologies and Airbnb. Craft raised $1.1B in 2021, bringing total assets under management to $2 billion, according to a Medium post published by the company. Unicorns in Craft Ventures Fund I and Fund II include Bird, BitGo, ClickUp, Pipe, Reddit, SourceGraph and SpaceX.
While he was in college, Sacks co-wrote a book in 1995 with Peter Thiel, the co-founder of PayPal, Palantir and Founders Fund. Thiel was the first outside investor in Facebook. Their book, “The Diversity Myth: Multiculturalism and the Politics of Intolerance at Stanford,” criticized political correctness in higher education and argued that more intellectual diversity is needed on college campuses. In 2016, Sacks apologized for parts of the book including where he called date rape “belated regret” and questioned, “Why is all blame placed on the man?”
A significant booster of Republican candidates, he sponsored a 2022 “Take Back The Senate” fundraiser for GOP senate hopefuls including J.D. Vance.
With a real-time net worth of $4.9 billion, Vinod Khosla is a partner at Silicon Valley venture capital firm Khosla Ventures, investing in experimental technologies such as biomedicine and robotics.
In 1982, Khosla co-founded Sun Microsystems (an acronym for the Stanford University Network). Khosla raised $300,000 in seed capital from Kleiner Perkins. Within five years, Sun made $1 billion in annual sales. Khosla spent 18 years at venture capital firm Kleiner Perkins, where he incubated Juniper Networks and suggested that it develop an “internet router instead of the plain vanilla router mostly used.” Khosla invested $275,000, which became his largest return on investment. A $3 million investment in Juniper Networks in the 1990s earned $7 billion for Kleiner Perkins, according to The Wall Street Journal.
He founded Khosla Ventures in 2004, wanting to spend more time with his teenage children and to invest in experimental technologies with a “social impact.” He invested heavily in ethanol companies. As of 2021, Khosla Ventures managed $15 billion of investor capital and investments funded by Khosla.
Images: John Doerr, (TechCrunch), https://en.wikipedia.org/wiki/en:Creative_Commons
https://creativecommons.org/licenses/by/2.0/deed.en
Marc Andreessen, (JD Lasica) https://www.flickr.com/photos/jdlasica/10082059294/
https://en.wikipedia.org/wiki/en:Creative_Commons
Douglas Leone at TechCrunch Disrupt SF 2013, https://www.flickr.com/photos/techcrunch/9716501075/
https://en.wikipedia.org/wiki/en:Creative_Commons
David Sacks (Robert Scoble), https://www.flickr.com/photos/scobleizer/5435256332/
https://en.wikipedia.org/wiki/en:Creative_Commons
