Technology

Peter Thiel helped build Facebook, now he’s building a new anti-tech right – The Washington Post

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On a summer morning in 2019, Rep. Matt Gaetz was having breakfast at the Los Angeles mansion of billionaire investor Peter Thiel, who would become one of the Republican Party’s biggest donors. At the time, Thiel was locked in a to-be-or-not-to-be debate over whether to leave the board of Facebook. Aware of Thiel’s love of Shakespeare, Gaetz (R-Fla.) playfully dubbed him Hamlet.

Like many Republicans, Gaetz viewed the social media giant as increasingly monopolistic and dangerous. He and another guest, entrepreneur and former right-wing provocateur Chuck Johnson, encouraged Thiel to leave the company. But Thiel demurred, telling the pair that he hoped to change it from within, according to two people familiar with the conversation.

Last month, Thiel finally stepped down from the social network, formally dissolving one of the most powerful partnerships in the history of Silicon Valley. As Facebook’s first outside investor, its longest-serving board member and a close adviser to CEO Mark Zuckerberg since he launched the company as a Harvard sophomore in 2004, Thiel helped alter the direction of the company whose products serve billions.

Thiel’s ambition to serve as an architect of the American right had grown increasingly at odds with his position on the board of one of the movement’s top enemies — a political shift that dovetailed with his own growing alienation from Silicon Valley.

Peter Thiel to exit Facebook’s board to focus on 2022 midterms

Reports at the time said that Thiel left the Facebook board to focus on politics, including a slate of 2022 congressional candidates aligned with former president Donald Trump.

But interviews with members of his inner circle indicate that his departure was years in the making, driven by a growing philosophical rift between Thiel and Facebook as conservatives became uncomfortable with the tech industry’s willingness to police online speech. Thiel, according to those close to him, lost his appetite to serve as Facebook’s defender as his political aspirations matured.

This account is based on interviews with more than a dozen people familiar with Thiel’s thinking, who spoke on the condition of anonymity to describe private conversations.

Since March of 2021, Thiel has pumped more than $20 million into 16 political campaigns, including the Ohio Senate race where close associate J.D. Vance last month won the Republican nomination, in part by attacking Big Tech and social media censorship. Thiel also has given at least $13.5 million to acolyte Blake Masters, a Republican candidate for Senate in Arizona who serves as president of Thiel’s personal foundation and has positioned himself as an adversary of Big Tech.

New reporting shows Thiel has set his sights on transforming American culture — and funding its culture wars — through what his associates refer to as “anti-woke” business ventures. These include a right-wing film festival, a gay dating app for conservatives founded by a former Trump administration ally and a firm, Strive Asset Management, that will “pressure CEOs to steer clear of environmental, social and political” causes, said Vivek Ramaswamy, the firm’s co-founder. One example is oil companies “committing to reduce production to meet environmental goals.”

More such investments are coming, the people said — though Thiel himself isn’t sure of the endgame.

“Peter deeply believes that there is huge opportunity in creating a parallel economy,” said Ramaswamy, a former biotech CEO and author of “Woke, Inc.: Inside America’s Social Justice Scam.”

“Serving Americans who are disaffected from corporate America today would be the backbone of the next generation of major companies — and almost nobody is going after that opportunity in a serious way,” he said.

The radicalization of J.D. Vance

Thiel’s growing political clout mirrors that of another Silicon Valley billionaire, Elon Musk, a self-proclaimed libertarian who espouses increasingly right-wing views to his 94 million Twitter followers, as he finalizes his deal to buy the social network. The men are not close — Thiel pushed out Musk when the two ran PayPal — but they’ve become more aligned politically, often echoing each other’s rhetoric as they criticize “socially responsible” investing and express concern about Big Tech’s control of speech.

They share a mutual PayPal-era friend, David Sacks, who has vetted individuals interested in political opportunities with both billionaires, according to one of the people. Thiel is enthusiastic about Musk running Twitter, two associates said.

Thiel and Musk may herald the rise of a new breed of tech billionaire, turning their deep pockets and distinct ideologies away from the companies that made their fortunes toward building a new version of the American right. It’s a powerful group that has the potential to anoint a rising generation of political leaders, transforming both the GOP and Silicon Valley.

During Trump’s presidency, new reporting shows Thiel’s relationship with Facebook became increasingly strained, beset by conflicts that left him feeling that the company was acting against his values, according to four people. In a 2021 talk alongside former Trump Secretary of State Mike Pompeo, Thiel criticized Facebook for supporting “woke politics” and “de-platforming” the account of former president Trump.

“Since at least 2018, he’s become very concerned about Facebook. He was uncomfortable with how they were using their monopolistic power,” said another one of the people familiar with his thinking. “But he was reluctant to leave because he felt he could do more, affect more change, from the inside.”

By 2022, Thiel was convinced: His change would be made from the outside.

From asset to alienation

Thiel declined requests for an interview. Facebook referred The Post to Zuckerberg’s public comments on Thiel’s departure from the board. “Peter has been a valuable member of our board and I’m deeply grateful for everything he has done for our company — from believing in us when few others would, to teaching me so many lessons about business, economics, and the world,” Zuckerberg said in a news release.

Thiel has always been an outlier among Facebook’s largely liberal staff and board of directors. A gay self-proclaimed libertarian and a German immigrant who came to the U.S. as a young boy, he earned his initial wealth in Silicon Valley by co-founding the payments processor PayPal in 1998. He put a $500,000 angel investment into Facebook in 2004, when Zuckerberg was still a student at Harvard.

He also was an early and enthusiastic participant in the culture wars. As an undergraduate at Stanford University, he founded the right-wing campus newspaper Stanford Review, which published articles calling liberal professors secret Marxists and railed against the inclusion of non-White authors in the school’s curriculum, according to journalist Max Chafkin, author of the Thiel biography, “The Contrarian.”

Still, Thiel was long considered Facebook’s most influential board member, giving Zuckerberg opinions that went against the grain of other top advisers, said three of the people.

“Mark listened to him,” one of the people said. “Mark appreciated the contrarian impulse. Peter stood for a diversity of opinion on the platform, and Mark stood for a diversity of opinion on the board.”

And Thiel’s influence could be felt throughout the company. In his best-selling 2014 book, ‘Zero to One,” he argued that businesses should strive to make such a singular product that they become monopolies — while entrepreneurs consolidate power to run their companies like monarchies. Zuckerberg appeared to heed these lessons, multiple people said, from the structure of Facebook’s board, which gives the CEO the majority of voting shares and ultimate control, to his aggressive efforts to purchase or copy nascent competitors, a strategy that has given rise to accusations that the company is a monopoly. (Facebook denies these accusations.)

For years, Thiel acted as a bridge builder with conservatives, particularly in the spring of 2016, after the tech site Gizmodo reported that a small group of employees were intentionally blocking right-leaning news outlets from trending topics, a feature used to showcase popular news stories on the platform. That summer, Thiel helped counter charges of liberal bias by brokering a closed-door meeting between Zuckerberg and prominent conservative politicians and publishers, including Fox News host Tucker Carlson.

Some Facebook executives thought Thiel was overstepping to help his soon-to-be political allies. Those tensions would explode later that summer, when Thiel donated $1.25 million to Donald Trump’s presidential campaign and spoke in support of him at the Republican National convention.

The move put the investor on a collision course with Facebook’s Democratic board members and liberal employee base. After Thiel’s convention speech, he received an email from fellow board member, Netflix CEO Reed Hastings, who called the decision “catastrophically bad judgment.” Hastings declined to comment.

Feeling attacked, Thiel shared the email with Johnson, who later leaked it to the New York Times, according to two of the people. Thiel’s leak caused a rift and sense of betrayal within the board , according to two people familiar with the matter.

Thiel’s support of Trump — along with comments that resurfaced from a book co-authored with David Sacks that “a multicultural rape charge may indicate nothing more than a belated regret” and that some rape charges are “seductions that are later regretted” — provoked outcry within Facebook during election season, but Zuckerberg continued to defend his adviser. (Thiel apologized for the comments.)

“We can’t create a culture that says it cares about diversity and then excludes almost half the country because they back a political candidate,” Zuckerberg wrote, according to a leaked copy of an October 2016 memo referencing “concerns about Peter Thiel.”

Thiel stayed on the board after the incident, but soon began to speak about a desire to resign, three of the people said. In 2017, he largely sold off his remaining Facebook shares.

After Trump won the presidency, Thiel, with assistance from Masters, began to tap talent in Silicon Valley to work with the new administration. At the same time, he became increasingly embedded in a right-wing philosophy that began to view “Big Tech censorship” as a target and was highly critical of China.

He became close with Trump adviser Stephen K. Bannon, a China hawk, in the run-up to the 2016 election. After returning from a book tour in the country, Thiel began to espouse increasingly strong anti-China views, including the belief that U.S. tech companies were harboring Chinese spies. In 2019 he claimed that Google, a longtime target of Thiel’s attacks, was being “infiltrated” by Chinese intelligence and called the company “treasonous.” He later attacked Apple for relying on China for its supply chain.

Zuckerberg had courted China for years in hopes of breaking into its lucrative market.

Soon after Thiel escalated his anti-China rhetoric, Zuckerberg did an about-face. In a 2020 congressional hearing, the CEO accused China of stealing U.S. technology. New evidence suggests this may have been partially due to Thiel’s influence: Thiel and Zuckerberg spoke about China, and Facebook’s sudden anti-China stance was in part fueled by a desire among company executives to curry favor with people in Trump’s orbit, they said.

Big Tech attacks become rallying cry for GOP candidates

Meanwhile, the right’s stance on social media was already beginning to change. Following revelations in 2017 that Russian operatives had used Facebook to sow widespread disinformation, and the Unite the Right rally in Charlottesville, which was organized and promoted on social media, tech companies created new rules about hate speech and misinformation, hiring thousands of content moderators to enforce them.

The result: a series of crackdowns that disproportionately impacted conservatives, who were more likely to break these rules. Among the earliest targets were conspiracy theorist and media personality Alex Jones and alt-right influencer Milo Yiannopoulos, whose ban came after he’d participated in a harassment campaign against actress Leslie Jones.

“For people on the right, all this was seen as retribution for winning the 2016 election,” said Amalia Halikias, Masters’ campaign manager and a former campaign policy director for Sen. Josh Hawley (R-Mo.), another longtime beneficiary of Thiel’s largesse.

Thiel’s proteges were leveraging this alleged persecution to build momentum. Hawley would go on to become one of the biggest critics of Big Tech in the Senate, along with Sen. Ted Cruz (R-Tex.), another elite law school graduate who has received hundreds of thousands of dollars from Thiel since his first Senate bid in 2012.

The reluctant kingmaker

By 2018, Thiel had become so alienated from Silicon Valley that he relocated his home and his investment firms to Los Angeles, said several of the people.

His connections with the far-right, meanwhile, were growing. Thiel, who had long been a quiet donor to conservative think tanks became a funder of the National Conservatism Conference, an emerging venue for rising populist figures on the right. He grew closer with Johnson, who’d met Thiel at a conference while a college student, and who has been permanently banned from Twitter since 2015, for allegedly attacking a Black Lives Matter activist. (Johnson, who has sued Twitter over his suspension, says his removal was unfair and that his tweet was “part of a journalistic project.”)

Through Johnson, Thiel became friendly with Gaetz, then viewed as a rising star in the GOP. The pair enjoyed long philosophical conversations about what they perceived as the power of technology companies to silence people and threaten American democracy, two of the people said. Last year, Gaetz suggested that his supporters use their Second Amendment rights to fight against Silicon Valley’s ability to “cancel” people who don’t “conform to their way of thinking.” (A Gaetz spokesperson said at the time that the interpretation was a “wildly irresponsible mis-framing” of his comments.)

In addition to his support of candidates that attacked Facebook, Thiel has also undermined both the company and Zuckerberg personally, new reporting shows. He was upset that Zuckerberg and his wife, Priscilla Chan, gave more than $400 million to nonprofits to help fund election administration during the 2020 election, a donation viewed by the right as disproportionately helping Democrats. It prompted an angry joint New York Post op-ed from Vance and Masters, who had discussed the issue with Thiel, the people said.

In 2021, Thiel followed his Stanford Review friend and fellow investor Keith Rabois to Miami, where they bought waterfront mansions and opened up a branch of Thiel’s venture capital firm Founder’s Fund.

Though Thiel largely sat out the 2020 presidential election, in March 2021 he gave $10 million to the long-shot candidacy of Vance, a former employee who wrote the best-selling book “Hillbilly Elegy.” A $10 million contribution to Masters followed in April.

With Thiel’s help securing Trump’s endorsement and a last-minute infusion of $1.5 million, Vance won the Ohio primary, said a person familiar with the inner workings of the campaign. Vance now faces Democrat Tim Ryan in the race to replace retiring Sen. Rob Portman (R-Ohio), a moderate who endorsed Vance’s primary opponent.

Though Thiel has expressed doubts about whether the Trump administration was too chaotic to achieve its aims, according to two of the people, he maintains ties with Trump and his son-in-law Jared Kushner. Thiel had lunch with Trump at Mar-a-Lago as recently as February, one of the people said. He had brought Masters to meet with Trump in the hopes of securing an endorsement, two people said.

Vance’s argument — that he was a former Silicon Valley insider who turned against it — resonated powerfully with GOP primary voters, said Luke Thompson, who ran a Thiel-funded super PAC that supported Vance.

At his campaign rallies and town halls, Vance got his biggest applause when he went after tech companies, railing against bans of prominent conservatives, including Vance himself, who was briefly suspended for what Twitter said was a misunderstanding about whether his account was legitimate.

“I bet half the people in this room have been shadow-banned on Facebook,” Vance said at a rally in Dayton during the last week of his campaign.

But Thiel’s association with Facebook sometimes hurt both men, particularly Masters. When Masters campaigns in Arizona, locals ask why his main funder is a Facebook board member. His opponent recently ran an attack ad calling Masters a “puppet of California Big Tech.”

Masters’s response, like Vance’s, has been to say that insiders can dismantle the system from within.

Thiel has given a total of at least $20,188,842 this cycle, making him the fifth largest GOP donor according to the Center for Responsive Politics Open Secrets database. But the database only tracks disclosures through March 31, so the tally does not account for Thiel’s latest donations to Masters and Vance, or his investment in dark money groups that seek to influence the GOP’s trajectory but are not tied to a specific candidate.

Peter Thiel puts another $3.5 million behind Blake Masters in Arizona

He has also given small amounts to more than a dozen other candidates, some of whom have embraced the falsehood that widespread election fraud caused Trump to lose the presidency.

Despite his large checks, people who know Thiel say that the perception of him as a political kingmaker is wrong. He takes bets on individuals he knows well, rather than casting a wide net, they say. Unlike other megadonors, Thiel has not created a full-fledged political operation, with employees whose job is to vet political giving opportunities.

“Most donors are interested in spreading their influence across many candidates,” Thompson said. “They don’t want to put all their eggs in one basket.”

People familiar with Thiel’s giving style noted that he treats politics like venture capital and candidates like start-up founders, giving large amounts early on to support ideas and people with potential.

And Thiel, the people said, is not sure what he wants. He has told people he is unsure whether he will support Trump in 2024, said a longtime associate, who noted it was unclear whether Thiel himself believes in the “big lie.”

“There’s an ambivalence toward the political apparatus as a whole and more of a focus on trusted individuals. He is well past the point of dabbling, but there is still this hesitancy,” said one of the people.

Unlike Musk, whose main megaphone for provocation is Twitter itself, Thiel is a behind-the-scenes operator who has focused on investments that cater to consumers who he thinks are overlooked by societal institutions that have moved to the left.

In addition to the film festival, he has funded a Catholic prayer app, the conservative dating app, and a right-wing YouTube alternative Rumble. A recent investment is Strive, a firm that aims to rival megafirms like Vanguard and will buy large stakes in companies and push them away from environmental, social, and what the group describes as political agendas that the hurt the bottom line.

“He isn’t like the general putting his chips on the table and drawing out a coherent plan,” said a person familiar with Thiel’s thinking. “He is taking strong sniper shots for people and things he cares about. He is more like a professor. But intellectually, he is in battle mode.”

Though he is not active on Twitter, Thiel engages in rhetorical bomb-throwing. During his keynote at a Miami cryptocurrency conference in April, a crowd cheered and booed as Thiel angrily read out what he described as his personal “hate list” — individuals and ideas that he said were the true enemies of cryptocurrency, and therefore, economic progress.

When Facebook announced Thiel’s decision not to stand for reelection to the board this spring, many Facebook employees openly rejoiced, two people said.

But Thiel is expected to continue to informally advise Zuckerberg, and his influence is unlikely to fade completely. The company did not want him to leave the board, two people said.

But being free of the formal Facebook connection, the people said, will allow Thiel to push his ideas in bigger ways — even if he himself does not know quite what that future looks like.

“The left wants a villain. The right wants a sugar daddy,” said one of the people. “I can see how he could slot into that role. But there’s no grand vision for it.”

Josh Dawsey contributed to this report.

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