Keith Rabois Resurfaces at Silicon Valley VC Firm

I blogged on February 11th about how Silicon Valley looks the other way when one of its anointed wizards violates ethical, legal, or moral boundaries. The case noted in my post involved allegations of sexual harassment levied against Square's now-former COO Keith Rabois. He happens to have been among the early key employees and investors in PayPal and LinkedIn. That status gives him entree into just about anywhere in the Valley.

Keith Rabois

Rabois played his cards well. According to a story by the fine journalist Peter Delevett in today's siliconvalley.com, Rabois has just joined Khosla Ventures, one of Silicon Valley's premier venture capital operations. While Valley hotshots have made it a point to praise the move, not one has uttered a syllable about the circumstances that led Rabois to look for a new job. The rules apparently don't apply to the stars, at least not in star-struck Silicon Valley.

Silicon Valley's Startup Culture Vs. Employment Law

Silicon Valley's entrepreneurial spirit embraces a free-wheeling startup culture. Few rules animate these typically small firms, whose key employees essentially disdain boundaries and imagine social laws apply only to others. This atmosphere and belief system occasionally creates legal and moral issues for the enterprise founders, principal investors, management, and yes, the "staff."

Keith Rabois
(photo: NY Daily News)

A case in point is the recent resignation of Square's Chief Operating Officer Keith Rabois. According to a Reuters story picked up by siliconvaley.com, the COO said auf weidersehen due to a legal contretemps involving an employee with whom Rabois had canoodled for two years. The story suggested that startups and their key assets could essentially do, say, or suggest anything to anybody on the staff at any time. It was as open and as vulgar as a frat house on a drinking binge, or as dangerous as a physical game of "truth or dare."

The story didn't really pinpoint Silicon Valley's all-male executive suites as a cause of these behaviors. Yet, it's hardly a secret that the tech world is the boy's club, filled with young guns who've made money too easily and too quickly. They sometimes come from environments where privilege quickly translates into repellent actions taken without consideration for their consequences. The movie The Social Network, spotlighting the actions of Facebook's Mark Zuckerberg, shows Harvard's arrogant, implicit encouragement of entitlement. In that respect, Silicon Valley companies aren't greatly different than that Athens on the Charles.

What's most off-putting is the current American idealization of Silicon Valley's lack of ethos, I suppose.  "Creativity," "innovation," and "progress" apparently make objectionable behavior by very intelligent, ambitious under-25-year-old men acceptable. Behind this sleazy facade is not sexual drive as much as a drive for power and status. These young 'uns, intoxicated with their uninhibited use of control, become behavioral monsters or tricksters, such as the Sean Parker character Justin Timberlake so convincingly portrayed in The Social Network.

The Reuters piece mentions other activities, such as whitewater rafting, that had to be curtailed once a startup approached a significant financial scale and staff size. There was a sense of melancholy as small enterprise owners realized those "exciting" team-building activities were fraught with legal peril. The owners also realize employees might prefer getting paid via a lawsuit than through a problematic IPO. That is also the time when Silicon Valley's libertarian zillionaires discover they live in a land of laws, and not in a self-created nation of one-man rule.