ike many children these days, Ellen Pao’s daughter asks deeply probing questions about the state of our society. While at coding camp, the nine-year-old finds herself lonely because she is one of few girls there: “Mom, I’m at a desk all day. I don’t really have anybody on my team or to talk to. I’m just doing it by myself.” At first Pao responds, “That’s how you work when you get older. You’re just on your own.” But then she stops herself and thinks. “Maybe 20 years from now, when my daughter is a young woman embarking on her own career,” Pao muses, “discrimination in tech will be a relic of the past, like segregated lunch counters or Irish Need Not Apply signs.”
Pao is a former corporate attorney and Silicon Valley entrepreneur who went to work for the venture-capital firm Kleiner Perkins and then, in 2012, filed a $16 million gender-discrimination lawsuit against it. She alleged workplace retaliation by a partner at the firm with whom she had a brief affair. Then she alleged that she was fired in retaliation for the lawsuit. Potential damages could have run as high as $144 million.
Pao’s account of her struggle and her plan for compelling Silicon Valley and corporate America to be more friendly to women and other oppressed minorities is presented in her new book, Reset: My Fight for Inclusion and Lasting Change.
She begins with the genuinely inspiring story of her parents, two Chinese immigrants who fled from civil war and managed to achieve success in America. Her father earned a Ph.D. in mechanical and aeronautical engineering from Princeton, and her mother was one of the first women to obtain a Ph.D. in computer science, from the University of Pennsylvania. They were set up on a blind date, got married, and then raised three daughters together in suburban New Jersey.
Pao’s struggles, she says, were minor back then. Other kids might call her a “Jap” or a “Chink.” But “for my parents, life was simple: If you studied and worked hard and did your best, you got ahead—end of story.” By the time Pao was applying to college, she began to understand that things weren’t so simple. As an Asian, she was told that she would have a harder time getting into Ivy League schools than her peers. Pao never comes close to acknowledging that the drive for racial diversity—for more black and Hispanic students in return for fewer white and Asian ones—that she wants to instill in corporate America is a complete rejection of the way her parents got ahead.
After supposedly defying expectations—she received a degree in electrical engineering from Princeton and a law degree from Harvard—Pao goes to work for Cravath, Swaine & Moore, where she discovers in short order that men are pigs. She describes how one male partner would always lose his copy of the documents they were working on and would have to look over the shoulder of one of his female underlings. She saw him one day staring down the shirt of one of her female colleagues and realized in shock what he was up to. In another instance, “a senior partner would… plant himself just outside the doorway of my colleague’s office, licking an ice cream cone while staring at her.”
Pao’s stories about the world of corporate law are mostly innocuous—once she was asked to bring cookies for everyone at a meeting. She offers these anecdotes as a contrast to what she later experienced in Silicon Valley. Pao goes light on her difficulties at Cravath to demonstrate to the reader that she had proved herself willing to put up with a lot before resorting to legal action.
Indeed, Pao’s stories of life inside the Kleiner Perkins venture-capital firm sound like they are taking place at a frat party. Partners would sit on private jets discussing which ethnicity of porn star they preferred. They made passes at her, drank excessively, went to strip clubs, and cracked racist jokes. In discussing an explosion that cost $100,000 in damage to a home, one of the partners joked that the cause might be “Jewish lightning”—that is, arson to collect insurance money.
During her career as a corporate attorney and then at Kleiner Perkins, Pao claims she was shut out. If you didn’t get invited to the hockey games or the strip clubs, if you didn’t go out drinking with them afterward, you wouldn’t be included in certain kinds of deals. As a junior lawyer at a firm, it meant you wouldn’t be working for one of the rainmakers and your pay would reflect that. At a VC firm, it meant that you didn’t get to invest in the most promising companies.
This is all perfectly believable, but the problem is that things went downhill for Pao when she started sleeping with one of the other partners—one Ajit Nazre, who was married and had children. If Pao’s account is to be believed, the relationship began with some creepy advances. Immediately after she was hit by a car crossing a street in Germany, she says, Nazre touched her flirtatiously. On the same business trip, he tried to come to her room for a late-night assignation. With little explanation—beyond her not having much luck on the dating scene, not really having much time for it anyway, and Nazre’s claim that he was leaving his wife—we learn that the two of them started a relationship.
“‘We should have kids together,’ Ajit often said when I would break up with him. ‘You can’t even find time to have dinner together,’ I’d reply with a laugh. ‘Let’s figure that out first.’” The story doesn’t end well. Another colleague sees Nazre on a romantic weekend getaway with his wife and tells Pao. One could forgive the kind of naiveté Pao demonstrated in her first foray into corporate law. But how old do you have to be before you recognize yourself as a walking cliché? Sleeping with a married guy at the office who promises to leave his wife for you?
When she ended things for good, her situation at the office became more precarious. Nazre was promoted to be her immediate boss. Pao found herself increasingly isolated. She even found that she wasn’t invited to a dinner at the home of Kleiner Perkins’s most famous partner, Al Gore.
Meanwhile her colleagues were meeting behind her back with CEOs of companies she had promoted inside the firm. Pao registered complaints with her superiors repeatedly, but her reports to them and to HR went unnoticed. Eventually Nazre was offered a large amount of money to leave quietly after Pao filed a lawsuit. Once she did so, the company treated her even worse than it had before, eventually firing her.
She says she turned down a settlement because it wasn’t large enough for the partners to feel its sting, let alone change their behavior. So she decided to fight. “I had dreaded the prospect of litigation,” Pao writes. “But I was also fed up. They just wouldn’t listen to anything else. Even if I lost, I’d lose fighting for something I believed in.”
By this point, Pao’s personal life had taken a turn for the better. She had met Alphonse “Buddy” Fletcher at an Aspen Institute event—where else can socially conscious venture capitalists find love?—and married him. They had a child together in 2008.
hile Pao repeatedly praises her husband for his support during the difficult trial that ensued, one might also wonder whether it was Fletcher who encouraged her courtroom foray in the first place. Fletcher, a hedge-fund manager, has quite a litigious history himself.
In 2011, he filed a lawsuit against the Dakota apartment building in Manhattan when it turned down his request to expand his three-bedroom apartment in the building by buying an adjacent one. When the co-op board said they didn’t think he could afford a fifth unit in the building, Fletcher, who is black, sued for racial discrimination. The board claimed that Fletcher’s tax returns showed only about $700,000 in adjusted gross income—hardly enough to foot the mortgage and maintenance on the units he planned to own. The fact that Fletcher had been allowed to buy the first four apartments did not stir Fletcher from his claim of racial mistreatment, nor did the fact that he had recently served as president of the co-op board.
Nor was this the first time Fletcher had sued for racial discrimination. In 1991, he claimed that his bosses at Kidder Peabody hadn’t paid him what they promised. Arbitrators ultimately awarded him $1.3 million, but with no finding of discrimination.
While Pao was trying to get a large payday out of Kleiner Perkins, her husband’s finances were quickly unraveling. In 2011, the Wall Street Journal reported that his hedge fund, F.A.M., was double counting its assets, claiming $500 million when in fact its market investments were closer to $200 million. That year, the state of Louisiana filed a petition with the Grand Court of the Cayman Islands in an effort to recoup more than $100 million in pension money that three pension funds there had invested with Fletcher. He had offered the state a minimum 12 percent annual return—a deal the Journal called “unusual.” And it turned out he was dipping into another one of his funds to repay Louisiana.
Pao dismisses the stories about her husband and his finances as efforts by the media to smear him—and her. She suggests that racism and homophobia (Fletcher had relationships with men before he married Pao) were behind the stories by Vanity Fair and other publications that publicized his financial shenanigans.
It’s no surprise that Pao’s book doesn’t get into the fact that Fletcher himself has been accused of sexual harassment and discrimination by employees. In 2003, Fletcher was sued by a man he’d hired to manage his home in Connecticut. The man alleged that Fletcher made sexual advances toward him. A few years later, Fletcher was sued by another property manager, who claimed he had been fired after refusing Fletcher’s sexual advances. Both men reached confidential settlements with Fletcher. If only they had had someone like Ellen Pao to inspire them to drag their cases into court.
Pao eventually filed suit against Kleiner Perkins in 2012. The case garnered an enormous amount of media attention. Then she lost. In the end, all four of Pao’s claims were dismissed, but in her telling, it was a close call. After the judge was told that the jury had reached a verdict, one juror changed her mind. The judge sent the jurors back to deliberate more—and that juror changed her mind yet again and voted against Pao. How this vindicates her, considering that her claims were found meritless, is not clear.
The case did make Pao a feminist talking point for a time. She notes that she earned praise from Hillary Clinton and Sheryl Sandberg for her brave stance. And the ultimate compliment? “Lena Dunham of Girls asked me to share my experiences and advice with the readers of her newsletter Lenny.”
In the aftermath of the trial, she set up meetings with various powerful women she knew. “Over wine and cheese at the Ferry building,” “over Chinese takeout at my dining room table,” over “dinner at a Thai restaurant,” and in a “war room … fueled by gummy candies and adrenaline,” she and her colleagues agreed it was time to “accelerate the conversation.” So last year Pao launched Project Include, a nonprofit organization that will give Silicon Valley start-ups and VC firms advice about how to make themselves more diverse—changing hiring practices and evaluations to get more women “at the table.”
Reporting on the new venture, the Washington Post noted, “While Pao did not share how many companies have signed up, she said there had been more interest than she expected. Asked whether she was concerned that her suit against Kleiner Perkins could prompt some start-ups to shy away from getting involved, she said she wasn’t. ‘To the contrary, I’ve had people invite me to give talks about how to make their start-ups more inclusive,’ she said. ‘It’s been the opposite.’” Which is, I think, what Pao knew all along. She may have lost her case, but the threat of similar litigation will be enough to frighten most companies (particularly those with smaller profit margins than Kleiner Perkins) into some form of compliance.
or all her faults, Pao is not wrong about the “brogrammer” atmosphere at these companies. An alternate juror at her trial (a woman who worked at a tech firm) later noted in an interview with Business Insider that though she didn’t find “Pao as credible as she should have been…the environment definitely is biased against women in technology, and venture capital is even worse.”
At many Silicon Valley firms, men really do act like they are in a college dorm. Their conversations and behavior are completely inappropriate for work, and if their express purpose is not to make women feel extremely uncomfortable, then it is an inevitable by-product.
Is there a way around this? Why, so many decades after sexual-harassment suits have been enshrined into law, do completely outrageous cases seem to surface? How do powerful men get away with sending pictures of their private parts to people who work for them? How do men continue to demand sexual favors from colleagues or fire women who don’t comply?
What distinguishes Silicon Valley from what Walter Olson of the Cato Institute calls a “normal white-collar professional industry” like insurance sales? Olson, who has written extensively on employment law, says Silicon Valley is a lot like the entertainment industry. First, there are huge amounts of loose money floating around. Second, the talent is perceived as irreplaceable. And third, the career paths involve a lot of jumping from one firm to another. Companies that expose employees to bad behavior pay a premium to those who are willing to stick it out.
Add to this the fact that these industries are both deadline-oriented—people are regularly working together at 2 a.m. (and not in separate offices like lawyers)—which discourages older people and those with families from joining such firms in the first place. That serves to cut out a lot of adult supervision. Finally, it’s worth noting that Silicon Valley has encouraged a casual attitude toward the workplace. Offices stock liquor in the break rooms, have no dress code, and provide ping-pong tables and on-site massages—all serving to make employees think that work life is no different from personal life. Is it any surprise that 25-year-old men (and their bosses) behave badly under these circumstances?
But whether Pao’s plans for greater gender inclusiveness are likely to change things seems questionable. Much of the evidence suggests that sensitivity training does little good. And in some cases, talking to employees about negative stereotyping of women or racial minorities might actually spur employees to think negatively about their colleagues in ways they hadn’t considered before.
Which brings us back to the threat of litigation. Thanks to Pao’s case, companies are not only quivering over multimillion-dollar lawsuits, they are also considering ways to mitigate the possibility. And that means working with people like Pao to provide cover. While they may not be able to, or even care to, control the behavior of individual employees, they’d at least like to avoid the accusation of a “hostile workplace,” which could cost considerably more in court. Working with Pao and her colleagues won’t automatically ensure that lawsuits against them get thrown out, but signing on to Project Include will go a long way toward protecting them.
With or without the effect of Ellen Pao’s case, the culture in Silicon Valley is changing. But we might want to beware the change. Earlier this summer, James Damore, a Google engineer, published a manifesto detailing the problems with the company’s plans to hire more women. Though Damore began by saying, “I value diversity and inclusion, am not denying that sexism exists, and don’t endorse using stereotypes,” his suggestion that innate differences between men and women might account for their differing abilities and desires to become successful computer engineers was enough to get him fired.
Damore probably was under the impression that working hard and doing his best would be enough for him to get ahead. But he has now learned the same lesson as Pao. In a world that cares foremost about gender parity and racial proportionality, hard work is only one of many considerations in determining success. Pao’s new calling at Project Include may not earn her the kind of money that she would have gotten as a senior partner at Kleiner Perkins, but it might be hard to top the prestige and profile she will likely enjoy from here on in. Pao may have lost the battle, but she won the war.