When Silicon Valley Stopped Trying to Save the World

In September 2020, Brian Armstrong, the CEO of the cryptocurrency exchange platform Coinbase, did something unthinkable in Silicon Valley: he said there would be no politics at his company. 

This was right after the summer of George Floyd and Covid lockdowns and microaggressions in the workplace—when companies as conventional as Nordstrom and IBM were all of a sudden issuing official statements in support of the Black Lives Matter movement, and established financial institutions like JPMorgan Chase were committing billions of dollars toward investing in minority-owned businesses. Even Viacom-owned Paramount Network, the cable TV channel known for series like Battle of the Fittest Couple—not exactly a brand we look to for moral clarity—felt they had to take a stand, canceling production of its long-running show Cops, as protests against incidents of police brutality spread nationwide. In short, corporate statements (and cancellations) in the name of social justice causes became almost as commonplace as having an HR department. 

The pressure was intense for Coinbase to follow suit—including from inside the house.

In early June, reportedly hundreds of employees had staged a virtual walkout to protest the fact that Armstrong hadn’t moved quickly to make a public statement in support of BLM, even though the CEO had sent out a companywide email a week after George Floyd was killed, saying he knew many employees were “hurting” and that Coinbase was there to support them. 

Armstrong capitulated, voicing his support for BLM and apologizing to employees for his handling of a meeting on the topic, at which some workers reportedly became upset. But, though pressured to speak out, the press-shy CEO still felt that publishing a public statement in support of social causes was not the right move for every company, including his.

Armstrong’s stance was that there was a time and place for activism, but that, in the future, he wanted Coinbase to be “laser focused” on its fundamental mission—to build a platform for users to buy and sell cryptocurrencies.

That’s why, several months after the controversy, on September 27, 2020, he published a blog post stating that Coinbase would no longer engage in “broader societal issues.”

It’s worth reading his statement in full, but the key takeaways were plain:

At Coinbase, he said, we don’t:

• Debate causes or political candidates internally that are unrelated to work

• Expect the company to represent our personal beliefs externally

• Assume negative intent, or not have each other’s back

• Take on activism outside of our core mission at work

The company even went so far as to offer severance packages to the small percentage of employees who opted to leave because of the new policy. (Some 5 percent of employees, or about 60 people, took them up on the offer.) 

In the meantime, the reaction to Armstrong’s new corporate policy was swift and severe. Former Twitter CEO Dick Costolo was especially fired up: “Me-first capitalists who think you can separate society from business are going to be the first people lined up against the wall and shot in the revolution,” he posted. (Costolo could not be reached for comment on this story.) The social media company’s co-founder, and another of its former CEOs, Jack Dorsey, also chimed in, implying that by not acknowledging the “related societal issues” faced by Coinbase’s customers, the company and its leader were leaving “people behind.”

Another tech insider, entrepreneur Aaron White, tweeted that Armstrong’s statement struck him as “isolationist fantasy” and that by taking an apolitical stance, the CEO was “effectively guaranteeing” he would land on the wrong side of history on “absolutely every issue.”

As Shaun Maguire—who was a partner at GV, Google’s investment wing, from 2016 until 2019—explains: “The culture of Silicon Valley when Brian did that was dominated by Big Tech, and if you go and look at the political donations they were making, it was skewed far left. Even people in the center were afraid to talk four years ago.”

Four years later, though, Brian Armstrong looks more prophetic than blasphemous.

That became crystal clear earlier this month, when pro-Palestine protesters barged into two of Google’s offices—one in New York City and one in Sunnyvale, California—and refused to leave until the search giant agreed to back out of a $1.2 billion cloud computing contract with the government of Israel. The company didn’t give in to their demands. Instead, it called the police. Ten hours after the sit-in began, the protesters were arrested on trespassing charges, and a couple of days later at least 28 staffers involved with the incident were fired. In a note to employees, CEO Sundar Pichai stated that while Google has a “culture of vibrant, open discussion,” it is also a place of work. 

“This is a business, and not a place to act in a way that disrupts coworkers or makes them feel unsafe, to attempt to use the company as a personal platform, or to fight over disruptive issues or debate politics,” Pichai said in the memo to staff. “This is too important a moment as a company for us to be distracted.”

The new policy was a striking reversal for Google, which historically has been better known for capitulating to employee demands than quelling them. Back in 2018, for instance, Google said it would not renew a contract with the Pentagon after several thousand employees signed a petition protesting the company’s involvement with an AI project aimed at improving drone strikes.

Last month, Shaun Maguire—the former GV employee—told The Free Press that working for the company in this era was “like being in an authoritarian country where only certain views and people were accepted.” 

But apparently, even Google’s leadership has reached a breaking point. 

“I think the reason it’s less controversial now is that more people have seen how activism went too far in these companies,” says Armstrong.

Most obviously, the release of Google’s flagship AI product, Gemini, made headlines earlier this year because of its extreme ideological bias. As The Free Press reported in March, if you asked Gemini whether Hitler or Elon Musk is more dangerous, “the AI chatbot says that it is ‘complex and requires careful consideration.’ Ask it the same question about Obama and Hitler and it will tell you the question is ‘inappropriate and misleading.’ ” It also refused to condemn pedophilia. In the wake of this embarrassment, the market value of Google’s parent company, Alphabet, fell more than $90 billion.

There are other reasons for the shift in policy, according to Armstrong. “I think [Elon] Musk buying Twitter also helped shape culture to a degree people haven’t fully internalized yet.”

But perhaps more importantly, since then we have gone, as Armstrong explains, “from a zero-interest rate environment to an economic crash where most companies did layoffs, so the balance of power shifted between employees and leadership.” Employers didn’t have to bend over backward to keep talent anymore.

It’s not just Google’s atmosphere that has changed—it’s the entire industry. “It used to be all about sitting on bean bags, drinking lattes,” says David Heinemeier Hansson, co-owner and chief technology officer of 37signals, a software company based in Chicago. “But that whole vibe has changed.”

37signals is the parent company of Basecamp, the project management software designer, which was a rare early adopter of Coinbase’s approach to a politics-free workplace. Like Coinbase, Basecamp’s decision, made in April 2021, was a reaction to the politically charged debates that its leaders felt were spinning out of control—and becoming an unacceptable distraction. 

“It had become insufferable,” says Heinemeier Hansson. “It consumed more and more of the business, and there were efforts to force us to do things that weren’t right. There were employees at the time, inside the company, who were interested in running ideological background checks on customers.”

Another tipping point was when a list of “funny” customer names that had been circulating internally for years began causing a lot of disagreement about the company’s culture and how it should address diversity issues. (Basecamp hasn’t shared specific examples from the list, but it’s been reported that the controversy arose because some of them were of Asian or African origin.)

Jason Fried, Basecamp’s CEO, says he and Heinemeier Hansson didn’t create the list, and that it should have never existed. “I don’t feel good about that list,” says Fried. “You shouldn’t talk about your customers that way.”

Ultimately, though, what started as an unprofessional joke created lots of unintended rifts between employees, and of course with management, who some workers felt should take a stronger stand—not just against the list, but on broader social issues. 

So when, in April 2021, Fried introduced the new policy to Basecamp’s staff—stating clearly, “We are not a social impact company”—he and Heinemeier Hansson were berated by many for their position, which one employee labeled as “oppressive.” Hours after the announcement, several employees quit their jobs. And over the next couple of weeks, about a third of the company’s workers took severance packages—which, like Coinbase, Basecamp offered to anyone who wasn’t on board with the new rules. Some of those who stayed, like the company’s head of human resources, Andrea LaRowe, had to contend with accusations that they were working for “Nazis.”

Looking back, Heinemeier Hansson and Fried say they knew that their decision could tarnish their reputations in the eyes of many in the tech industry, but they didn’t realize just how much it could impact other employees who stayed in the company. That doesn’t mean that they regret the policy change. Far from it. Both leaders say that Basecamp has been more productive than ever in the ensuing years. And even in the face of the backlash, they felt that they had stayed true to what they believe. As Heinemeier Hansson so elegantly puts it: “What’s the point of having ‘fuck you’ money if you don’t ever say fuck you?”

What seemed like a great idea at the dawn of the internet—that tech companies could serve a bigger, better purpose in the world—has become fraught and untenable. Google’s original motto, “Don’t be evil,” was an admirable mantra for a company building the world’s biggest search engine. (It was changed to “Do the right thing” after Google went through a restructuring in 2015, reorganizing under Alphabet.) But as it turns out, people have very different definitions of what is evil, and what is right. And in the case of Google, some of its employees seem to have put ideas like Zionism, or even capitalism, in that first bucket. 

A few years ago, those employees might have had the power to push their particular agenda forward. “Google was known for coddling its employees, and it took feedback from them very seriously,” particularly around the time Google backed out of its contract with the Pentagon, says a former employee who worked in internal communications.

Back then, competition was high for tech employees. Fast-forward a few years, though, and that’s no longer the case. More than a quarter of a million tech workers were laid off from their companies in 2023. “Employers don’t have to tolerate that kind of behavior anymore,” says the former Google employee, who asked to remain anonymous. “The idea of bringing your whole self to work has turned into bringing your professional self to work.”

That’s exactly the shift both Coinbase and Basecamp were aiming for in the early 2020s.

“It was a very difficult decision for us to make in the moment, but probably one of the best decisions we’ve ever made,” says Fried. “To be able to avoid the continuous distraction of politics today, to be able to sidestep all of it now when it’s only gotten worse, is just a huge relief.”

Both Fried and Heinemeier Hansson also use the word relief to describe their reaction to the recent developments at Google. There’s a sense of vindication too—at least one friend who Fried says had “turned his back” on them in 2021 has reached out to apologize in recent days. 

“People have started to think back on their reaction from a few years ago,” says Fried. “It reentered their consciousness.”

As for Coinbase’s Armstrong, he’s cautiously optimistic that companies can return to focusing on technology without incurring the wrath he did in 2020. 

But undoing years of inertia in the other direction won’t be easy: “Mostly I’m just hopeful that Google turns a corner and is able to get back on track,” says Armstrong. “I seriously doubt it will happen unless they exit a large number of employees who are pursuing their own agenda rather than the company’s mission.”

Michal Lev-Ram is a Silicon Valley–based tech journalist and editor-at-large at Fortune. Follow her @mlevram.

For more on this subject, read The Free Press report on the Gemini fiasco: “Google’s Woke AI Wasn’t a Mistake. We Know. We Were There.” And subscribe today for more detailed reporting from the tech world: