Why Silicon Valley Must Engage with Government

Moving From "Exit" To "Voice & Build"

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Why Silicon Valley Must Engage with Government

Yeah, I pay taxes, so much taxes, shit don't make sense
Where do my dollars go? You see lately, I ain't been convinced
I guess they say my dollars supposed to build roads and schools
But my n***** barely graduate, they ain't got the tools…

If I'm givin' y'all this hard-earned bread, I wanna know
Better yet, let me decide, bitch, it's 2018
Let me pick the things I'm funding from an app on my screen

- BRACKETS by J.Cole

In the 2023 tax season, the federal government collected $4.71 trillion and yet increasingly, it feels we’re simply not getting enough bang for our buck. 

Everytime I walk down the street and see human shit on the sidewalks, drugged out homeless people in dire need of medical help, face delays on the SF muni, hear of my immigrant friends’ struggles to remain in the country, and see littered streets, I think: “Can government ever work?” 

In response the government’s myriad of processes and policies, many people point to the internet itself as a model - instead of networking to chat with a CEO or author, you can simply shoot a thoughtful Twitter DM and there’s a half-decent shot they’ll respond. Why bother with bureaucratic systems when you only need agency and chutzpah? 

As such, alternatives like network states (internet-based communities seeking real-world autonomy) and SEZs (special economic zones) like Prospera in Honduras have skyrocketed. Much of this originates from Silicon Valley’s counterculture-anarchist streak. And I love this streak; it enables us to reimagine entire ways of life years ahead what other people in the world can comprehend.

But this anarchist bent also encourages technologists to favor “exiting” over “voicing” their concerns. It’s immensely telling that the Valley, which preaches product-market-fit and empathizing with the customer experience loses interest when the problem space is no longer software-as-a-service. And this ambivalence has been fueled, in part, by the extreme success of software companies. Moving bits on a screen doesn't require navigating building codes, FAA approvals, FDA regulations, bureaucratic red tape or convincing the American public of the validity of your idea.

But as founders & investors recognize that tomorrow’s Googles & Amazons will be atoms-based, startups will increasingly tend toward a collision course with governmental & cultural domains. And technologists must realize that no matter how intelligent you are and how great of a product you’re building, you can’t do it alone. Those who ignore this advice are in for a sober awakening.

Tesla: Silicon Valley’s WonderChild.

Few startups are as monumental as Tesla; disrupting the entire automobile industry that has not seen such a step-function change since the invention of the combustion vehicle in 1885. The path was long and challenging but by 2019, Tesla had delivered the Tesla Roadster, Model S, Model X & had solidly established that electric vehicles were no longer theoretical but a viable alternative to combustion engine car.

But due to the immense cost of the Model 3 development, Tesla was also weeks away from bankruptcy. Investors were refusing to provide further cash and as far as the nation was concerned, this was a matter of private markets and had little, if anything, to do with nation’s strategic interests.

China, impressed with Tesla’s technological development, stepped in and offered Elon massive subsidies to deploy Tesla factories in China. Faced with bankruptcy or working with the Chinese, Elon opened factories - a decision that saved the company but also handed over current & future innovations to Chinese competitors like BYD. Today, BYD leads in EV tech and Tesla is slowly being squeezed out of Chinese markets. 

As economist Noah Smith pointed out, companies face short-term challenges that can come at their’s & the nation’s long term expense, a gap that government could really help smooth over.

The truth that Silicon Valley must come to sobering terms with is that we are all more interconnected and reliant on each other than we’d like to believe. The Internet could not function without power plants, the grocery store worker who stocks the shelves of your local supermarket, the miner producing the metal for transmission lines, the nurse who patches up construction workers that build data centers, cops that enforce the laws that protect property rights, and the teacher educating tomorrow’s adults.

Even if you travel to the ends of the Earth or hole up in some bunker in Minnesota, some person or some institution has a say over your existence.

Government then is the crucial relational layer that ties in society together and it’s a layer we’ve ignored for far too long.

The Virtuous Flywheel

There is a path that aligns the interests of technologists, investors, media, government and society.

1. VCs+Founders fund & create tech that challenges norms and tangibly improves people lives.

2. Media reports on the usefulness of these technologies, shaping public perception & generating greater optimism.

3. Government realigns regulations to support beneficial technology and streamlines bureaucracy, raising the efficacy of government as a whole.

4. Supportive regulatory enviroment attracts more investment and talent.

5. VCs+founders fund & create meaningful tech…

To make this flywheel a reality, we each have a role to play.

It could mean starting a company. It needn’t be deep tech; great software works too.¹ 

Or you could work to raise capital to invest in non-traditional domains that have outsized benefits.² 

Or you can join the techno-optimistic media .³

Or you can work in government to navigate the bureaucracy and facilitate change. 

Or vote & voice your support for creating market-rate housing, tackling Section 174, building more in general and other such intiatives.

Regardless of what you choose, retreating into our Waymo rides and gripping our bags tightly while we walk by those who need our help is not an option. The narrative of progress is being written and if we each do our part, then maybe we’ll feel proud to write that tax check.

- Kiran

1. Though, according to Patrick Collison (CEO of Stripe), you might want to get some experience first if you want to do deep tech.

2. Curing Alzheimer’s is going to pay back many times than another CRM software.

3. Of course, please come with your geniune opinions. No one wants a parrot with false enthusiasm.

Thanks to Claude for editing.

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Kiran’s Gems 💎

• How I Got High-Profile Angel Investors to Join Our Seed Round by Mentava’s CEO Niel Hovens. Fascinating to see how a first-time, non-technical founder raised money & emphasizes the importance of storytelling to raise.

• “You were lucky enough to have the job that you would have in the post-singularity world anyways.” Great take on Dwarkesh Patel’s podcast and his approach of depth-over-breadth to stand out in podcasting.

• “There is certainly a lot of that going on, but the more time I spend walking the world, the more time I spend talking to people, I think the deeper answer is that the image the US projects and represents to a lot of the world, and in many ways provides its residents relative to other places — opportunity, material wealth, safety, independence, space, convenience, and lots of immediate pleasure — is a lot more appealing than what I’ve believed before, or want to believe. So appealing it breaks across cultural boundaries and life-long preferences." - Chris Arnade sharing on why the US is better than Europe & why most people believe so. Can be an eye-opener for inner city Yuppies.