Justin Caldbeck took a leave of absence from his firm after six women accused him of making unwanted advances, often in context of potential business deals
A prominent venture capitalist admitted to sexually harassing women in the tech industry, saying he leveraged his position of power in exchange for sexual gain in the latest discrimination and misconduct scandal to rock Silicon Valley.
Justin Caldbeck announced on Friday that he would be taking an indefinite leave of absence from Binary Capital, the firm he co-founded, following the claims of six women who accused the 40-year-old of making unwanted advances, often in the context of potential business deals.
The power dynamic that exists in venture capital is despicably unfair, he said in his statement. The gap of influence between male venture capitalists and female entrepreneurs is frightening and I hate that my behavior played a role in perpetrating a gender-hostile environment.
The lengthy apology from Caldbeck, who led investments in Grubhub and TaskRabbit, comes at a time of increasing backlash surrounding misogyny and toxic workplaces in tech. A major sexual harassment scandal at Uber contributed to the resignation this week of embattled CEO Travis Kalanick.
The Caldbeck allegations have shone a harsh light on sexism in the male-dominated venture capital sector, where powerful executives can make or break startups and where women who face mistreatment lack formal recourses to raise concerns or file complaints.
Tech news site the Information reported on Thursday that six women had accused Caldbeck of unwanted and inappropriate advances, with several saying the misconduct occurred when they sought funding or guidance while trying to start businesses. Two of the women decided to avoid business deals with him as a result of his behavior, the report said.
Three women went public with their claims. Niniane Wang, who co-created Google Desktop, alleged that Caldbeck tried to sleep with her while informally recruiting her for a job. Susan Ho, co-founder of Journy, a travel booking service, said the venture capitalist sent her text messages in the middle of the night suggesting they meet up while they were in the process of discussing investing in her startup. Leiti Hsu, another co-founder of Journy, said Caldbeck groped her under a table at a bar.
Three other anonymous sources shared stories with the Information about sexually explicit text messages and advances from Caldbeck despite their professional relationships. In the original piece, Caldbeck said: I strongly deny the Informations attacks on my character. The fact is, I have always enjoyed respectful relationships with female founders, business partners, and investors.
Binary also initially issued a statement that dismissed the claims as a few examples which show that Justin has in the past occasionally dated or flirted with women he met in a professional capacity.
But after the story spread in Silicon Valley, Caldbeck reversed his position and issued a direct apology to the three women named in the article and to the greater tech ecosystem, a community that I have utterly failed.
He also said he was deeply ashamed of his lack of self-awareness and would seek professional counseling: The dynamic of this industry makes it hard to speak up, but this is the type of action that leads to progress and change, starting with me.
Binary did not immediately respond to the Guardians request for comment on Friday.
While much of the discussion in Silicon Valley has focused on male executives harassing subordinates, there have been fewer public stories about venture capitalists targeting women seeking funding a relationship where victims of misconduct arent employees and dont have any traditional avenues to speak up.
Research has repeatedly shown that female entrepreneurs are far less likely to be funded than men and that venture capitalists (VCs) are plagued by biases toward supporting men, which contributes to the extreme lack of diversity across the industry and can more broadly hinder innovation.
Reid Hoffman, the founder of LinkedIn, issued a scathing response to the Caldbeck scandal on Friday, saying that VCs must have the same moral position to the entrepreneurs they interact with that a manager has to an employee, or a college professor to a student, adding: We all need to solve this problem. If you stay silent, if you dont act, then you allow this problem to perpetuate.
Caldbeck previously worked at Bain Capital Ventures and Lightspeed Venture Partners before starting his own firm, which has raised $300m and financed a range of startups, according to the Information.
Binary was profiled in the New York Times when it launched in 2014, with a story noting the firms mission to invest in early stage companies that have the potential to have a global impact and to give a portion of the interest to charitable organizations.
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