When computers were just for nerds and large corporations, Silicon Valley's elite could get away with arrogance, insularity and sexism. They were building products for people that looked just like them. The child geniuses inspired so much awe that their frat-boy behavior was a topic of amusement.
Now technology is everywhere. It is being used by everyone. Grandma downloads apps and communicates with junior over Facebook. Women are dominating social media and African-Americans are becoming Twitter's fastest-growing demographic group.
The public is investing billions of dollars in tech companies and expects professionalism, maturity, and corporate social responsibility. It is losing its tolerance for elitism and arrogance.
Note what just happened when Silicon Valley luminary Tom Perkins wrote to the Wall Street Journal to complain of public criticism of the Bay Area elite and his ex-wife Danielle Steel. He said, "Writing from the epicenter of progressive thought, San Francisco, I would call attention to the parallels of fascist Nazi Germany to its war on its 'one percent,' namely its Jews, to the progressive war on the American one percent, namely the 'rich.'"
There was such an outpouring of anger on social media over the comparison to the Nazi genocide that the venture capital firm Perkins founded, Kleiner Perkins Caufield & Byers, disavowed its association with him. Tech blogs and newspapers lashed out. Silicon Valley heavyweights such as Marc Andreesen and Marc Benioff expressed their disapproval. It is a rare thing in Silicon Valley for any venture capitalist or CEO to speak up against a tech luminary, no matter how much out of line he may be. So this was a surprise.
The Perkins controversy is the tip of the iceberg. Kleiner Perkins is itself embroiled in a sexual-harassment scandal that it chose to litigate rather than settle. When Twitter filed for an IPO with an all-male board, the New York Times slammed it for being an old boys' club. Rather than admitting that his company may have erred, Twitter CEO Dick Costolo chose to lash out publicly against a critic — me — for expressing outrage in the article. A few weeks later, Twitter gave in to the growing backlash and announced a woman director. There was no apology or humility, however.
In most industries, discriminating on the basis of gender, race or age would be considered illegal. Yet in the tech industry, venture capitalists routinely show off about their "pattern recognition" capabilities. They say they can recognize a successful entrepreneur, engineer or business executive when they see one. The pattern always resembles Mark Zuckerberg, Bill Gates, Jeff Bezos or them: a nerdy male. Women, blacks and Latinos are at a disadvantage as are older entrepreneurs. Venture capitalists openly admit that they only fund young entrepreneurs and claim that older people can't innovate.
It isn't just venture capitalists who are insensitive to federal employment-discrimination laws. Most tech companies refuse to release gender, race or age data. They claim this information is a trade secret. Whatever data are available reveal a strong bias towards young males.
In his letter to Wall Street Journal, Perkins complained of the outraged public reaction to Google buses carrying technology workers and to rising real-estate prices. But these are genuine grievances. Longtime residents of San Francisco are being displaced because of skyrocketing rents. Bus stops are being clogged with fleets of luxury buses. The tech industry is taking advantage of the investment that taxpayers made in public infrastructure, the Internet and education — without giving much back or even acknowledging its debts to society.
Silicon Valley's tech companies are also disconnected from the communities in which they live. They remain aloof about the problems that the poor face. Very few help set up soup kitchens, build houses for the homeless or provide scholarships for disadvantaged children. Tech moguls such as Peter Thiel go as far as admonishing the value of higher education itself — and paying children $100,000 to drop out of college. Most start-ups focus on building senseless social media-type apps or solving the problems of the rich — and that is what venture capitalists typically fund.
Silicon Valley has an important role to play in solving the world's problems. It is the epicenter of innovation. Most technologists I know have a social conscience and want to do whatever they can to make the world a better place. Yet the power brokers — most venture capitalists, super-rich angel investors and CEOs — consistently show a disregard for social causes. They display a high level of arrogance, demand tax cuts for themselves and have a don't-care attitude. As demonstrated by the Perkins letter, this sends the wrong message to the world and holds Silicon Valley back.
It is time for the Silicon Valley elite to smell the coffee and realize that the world has changed — and that they must, too. It is time for tech entrepreneurs to focus on solving big problems and giving back to the world.
— Vivek Wadhwa is a fellow at Rock Center for Corporate Governance at Stanford University, director of Research at Duke University, and distinguished scholar at Singularity and Emory universities. His past appointments include Harvard Law School and University of California Berkeley. This piece reflects his opinion.