Peter Thiel, bane of Silicon Valley

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FOR A MAN who wants to live forever, Peter Thiel has already done enough in his 53 years to leave mere mortals exhausted and above all frustrated. The venture capitalist, techno-utopian and scourge of the liberal left is a myriad of contradictions.

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He co-founded PayPal, a payments platform that as a young libertarian hoped to undermine the global monetary system. Instead, it gave him the money to ride Silicon Valley, a place he despises. He was the first outside investor in Facebook, a tech giant he remains in, though he doesn’t care about social media. As a hedge fund manager, he bet on an economic collapse in America before the 2007-09 financial crisis, but called the market bottom too soon. He was one of the most prominent financiers supporting Donald Trump’s presidential bid in 2016. Yet his efforts to populate the Trump administration with radical-thinking acolytes have failed.

Max Chafkin, who goes through this litany of inconsistencies in a new book, “The Contrarian”, writes fluently. But he fails to find an explanation that ties the threads together. At his most charitable, he praises Mr. Thiel as the creator of immense wealth because of the tech companies he has supported (besides PayPal and Facebook, they include sharing economy giants such as Airbnb and Lyft. , as well as a host of other blitzscaling platforms). At his most damning, he describes his subject as a tax-dodging “nihilist” whose right-wing ideology is primarily aimed at increasing his wealth and power.

And yet, strangely, Mr. Chafkin, a business writer, only indirectly refers to the most intriguing business story. Between the lines, an image emerges of an erratic visionary whose work, however frightening, is not finished. Mr. Thiel applies the radicalism that inspired PayPal to cryptocurrencies and decentralized payment platforms. The “Make America Great Again” schtick that drew him to Mr. Trump has led to investments in military, surveillance and space technologies that have helped double his net worth over the past year. His desire to reclaim Silicon Valley from software-loving pacifists and return to his roots in the Cold War military-industrial complex is bearing fruit and spreading beyond California.

In short, his particular brand of libertarianism seems to have a new lease of life. On the one hand, he wants to free individuals from the government shackles by allowing them to create their own currency. With the other, he sells technology to a powerful security establishment so that it can protect them from potential enemies. Enough to hyperventilate the mix of hippies and Silicon Valley yuppies on their yoga mats.

This isn’t the first time that a man described by Mr. Chafkin as socially awkward has created a movement of like-minded people determined to shake up the tech industry. The PayPal mafia he helped muster at the turn of the century continues to thrive. Besides him, his best-known member is Elon Musk, whose rocket company SpaceX is backed by Mr Thiel’s Founders Fund, a venture capital firm (CV) solidify. Last valued at $ 74 billion, it returned the very first civilian crew from orbit on September 18. He is at the forefront of the revitalized American aerospace industry.

Others, too, have remained loyal to Mr. Thiel for decades and share his obsessions with security. Palantir, a $ 52 billion data analytics company, is used by the U.S. military, immigration authorities, and many law enforcement agencies. It was co-founded by Mr Thiel in 2003 and is run by an old friend, Alexander Karp (who served on the board of directors of The Economistthe parent company of). Ahead of its IPO last year, Karp told potential investors that the company, although born in Silicon Valley, shares few of its values. “Our software is used to target terrorists and keep soldiers safe… we have chosen our side,” he said.

Anduril, a defense startup also backed by Mr Thiel, builds unmanned drones for military surveillance. Marc Andreessen from Andreessen Horowitz, a CV (who is also a director of Facebook), wrote about the emergence of a new generation of Silicon Valley-style defense companies. “Some in our industry find serving such agencies and missions controversial. We’re not doing it, ”he wrote in 2019, announcing a co-investment with Mr. Thiel’s founders’ fund in Anduril. It was last valued at around $ 4.6 billion.

Even without Mr. Trump, Mr. Thiel continues to mix business and politics. This year, he teamed up with Narya, a venture capital fund led by JD Vance, author of “Hillbilly Elegy,” to invest in Rumble, a video platform popular among right-hangers. He supports Mr. Vance in the Republican Senate primary in Ohio. Blake Masters, co-author of Mr. Thiel on “Zero to One,” a 2014 bestseller, hopes to represent Republicans in the Arizona Senate race. The New Yorker speculated that “Rise of Thieves” could provide the Republican Party with a post-Trump ideology.

Cryptoking

If so, it would likely involve continuing the pillory of big tech companies, especially Google, which Mr Thiel has long accused of being a monopoly. The new ideology is said to be anti-China, a country Mr Thiel describes as using artificial intelligence (AI) to centralize control of the economy. “Yes AI is communist, crypto is libertarian, ”he wrote last year. He would be favorable to cryptocurrencies and blockchains. He is a large backer of Block.one, a blockchain software company whose crypto unit, Bullish, plans to go public through a $ 9 billion reverse merger with a specialist acquisition company.

All of this is taking technology investments beyond Silicon Valley into new areas, some of them threatening to many observers. This will not worry Mr. Thiel. Palantir is named after a “stone of vision” most often used by Sauron, ruler of JRR Tolkien’s evil empire of Mordor in “The Lord of the Rings”. Obviously, Mr. Thiel, always against the grain, doesn’t view Mordor as harshly as most Tolkien fans. As he once said to a friend, “I’d rather be seen as a bad guy than an incompetent.

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This article appeared in the Business section of the print edition under the title “The Midas of Mordor”

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