2024 Election Exposes Schism Between Big Tech and Little Tech

While the executives and employees of legacy Big Tech companies like Facebook and Google continue to be one of the most reliably liberal groups in the country, the founders and investors involved in scrappy “Little Tech” startups are increasingly turned off by Democrat policies – and are throwing their support behind Republicans as a result.

During the tech revolution of the 2000s and 2010s, it was companies like Facebook, Uber, and Netflix that were viewed as the disruptive newcomers ready to shake up their respective industries – and American life along with it. Silicon Valley’s militant brand of progressive politics was just another way (albeit a foolish one) to challenge the status quo.

Now however, this generation of companies has reached the point where they are ensconced as the establishment that they once prided themselves on disrupting. Meanwhile a new class of startup tech companies – often direct competitors to legacy tech companies – have now become the next innovators and visionaries in the industry.

Marc Andreessen and Ben Horowitz, two prominent Silicon Valley founders turned venture capitalists focused on these new startups, have dubbed them “Little Tech.” As the pair explained in a web post entitled “The Little Tech Agenda” that generated significant media buzz last month, Little Tech has its own priorities that are often at cross purposes with Big Tech.

“We believe bad government policies are now the #1 threat to Little Tech,” they wrote, citing how onerous taxes and regulations are threatening the viability of startups, which they call “the vanguard of American technology supremacy.” The post makes the case that America’s economic future in the 21st century will depend on whether the country remains the best place in the world for startup tech companies.

As Andreessen and Horowitz detail, once startups claw their way up and establish a position of power, “they seek to lock in their gains, to pull the rope ladder up behind them. They inject themselves into the political system and seek regulatory capture – a wall of laws and regulations that protect and entrench their positions, and that new startups cannot possibly scale.”

As Big Tech companies have worked hand-in-hand with the Democrat Party, donating millions of dollars to Democrat candidates every cycle, the Democrat agenda has favored incumbents over startups, allowing established tech companies to use government power to snuff out the competition. One specific policy that Andreessen and Horowitz point to is Biden’s proposal to tax unrealized capital gains, which they say “would absolutely kill both startups and the venture capital industry that funds them.”

“For Little Tech, we think Donald Trump is actually the right choice,” Horowitz said during a podcast following release of The Little Tech Agenda, also announcing a significant donation to Trump’s re-election effort. Although Andreessen has said he endorsed and voted for Bill Clinton, Al Gore, John Kerry, Barack Obama and Hillary Clinton, he’s also backing Trump this cycle, stating that “the future of our business, the future of technology, and the future of America is at stake.”

Many startup companies have already voted with their feet by leaving liberal California to set up shop in more business-friendly states like Texas, Florida, and Tennessee. While nearly 20 percent of all U.S. tech jobs were located in California in 2020, that figure has fallen to just over 16 percent.

Even outside of startups, some more established Silicon Valley figures have recently openly rejected liberal policies and thrown their support behind Trump, most notably Elon Musk and PayPal founder David Marcus. In an X post last month, Marcus specifically noted that he was endorsing Trump because he wanted a president who was “pro business” and “pro Bitcoin/crypto.” Musk has also endorsed Trump, along with moving Tesla’s headquarters from California to Texas and announcing that he would relocate X (formerly Twitter) headquarters away from the Golden State.

Even Facebook founder Mark Zuckerberg, who has a long history of support for liberal policies, said Trump’s reaction to the assassination attempt against him was “one of the most badass things” and allegedly told Trump in a phone call that he won’t support a Democrat – although he stopped short of endorsing Trump.

Nonetheless, Democrats still retain a strong hold on Silicon Valley and the investor class in particular. Nearly 800 venture capitalists signed a “VCs for Kamala” pledge, despite the fact that, as Andreessen and Horowitz outline, Harris’s agenda would directly endanger their entire business. Well over 85 percent of political donations from tech employees went to Democrats in 2020, a figure that doesn’t appear likely to shift much this year.

But if Little Tech companies continue to challenge Big Tech for supremacy in the industry – and Republicans can win power to enact policies that enable their growth – Silicon Valley’s status as a liberal bastion may be beginning to crumble.

Andrew Shirley is a veteran speechwriter and AMAC Newsline columnist. His commentary can be found on X at @AA_Shirley.