Testimony in Silicon Valley sex discrimination case focused on a venture capitalist's annual review. Did it take a negative turn after her complaint or remain lukewarm?

By Shalene Gupta
February 27, 2015
February 27, 2015

A female venture capitalist received a poor performance review after she sued her employer for sex discrimination, at least according to her attorney, who tried to hammer the point home during testimony in a high-profile Silicon Valley case Friday.

Ellen Pao, who has accused the venture capital firm Kleiner Perkins of overlooking her for a promotion, was given a starkly different assessment from the prior year, the attorney implied.

Her 2012 review, compiled from feedback of executives of companies in which Kleiner Perkins invested, said, “Ellen was not providing the desired level of impact or leadership.” A year earlier, before she sued, however, a similar review said, “You have provided tremendous services to our CEOs that is appreciated and coveted.”

Friday was the fourth day of testimony in the high-profile case, which is offering a rare glimpse into the gender dynamics of the overwhelmingly male venture capital world in Silicon Valley. Pao, who was ultimately fired from Kleiner Perkins and is now CEO of online bulletin board Reddit, claims while working at Kleiner, she was pressured into a relationship with co-worker Ajit Nazre. After complaining, she said she faced retaliation and eventually was unable to get a promotion. Kleiner argued that Pao, who has double Harvard graduate degrees, did not have the skills to be successful in venture capital.

Ted Schlein, managing partner for Kleiner Perkins, said from the witness stand that Pao lacked “the genetic makeup” of a venture capitalist. “I was suspect whether she ultimately had the skills to be a successful partner,” he told the jury. “Her personality, how she viewed things, how she processed things. Kinda black and white, most of our business is quite grey.”

In its defense, Kleiner Perkins’ attorney has argued that Pao’s performance reviews over the years all included negative comments mixed with a smattering of positive ones. At times, she is described as “territorial” and “not 100% reliable,” for example, while simultaneously being called a “great service provider.”

On Friday, Kleiner Perkins’ attorney pointed to a review in 2010 that was lukewarm about Pao’s performance. Outside executives had said she “needs to be more calm, and have a more confident approach, don’t be so detailed oriented all the time,” and eventually concluded that “she just needs more seasoning and time.”

Schlein explained the positive 2011 review by saying an early draft had said she was not on track to be promoted. In fact, the firm had wanted her to leave, he said. However, Kleiner partner, John Doerr, who thought Pao had done a good job, pushed to have the review changed to be more positive.

“He asked to give Ellen another chance,” Schlein said of the 2011 review. “I disagreed but I did it.”

A year later, after getting her negative review, Pao asked Schlein for the names of CEOs who had provided the feedback. Schlein told the jury, “I said I’d look into whether or not it was appropriate to give her names.” However, he confirmed that historically CEO names were disclosed on prior performance reviews.

The 2012 review noted: “Ellen is not on track to be a senior investment partner.” It also said “she was cited more than any other junior partner as having areas that ‘do not meet expectations.’ ”

Pao wrote back saying the review failed to take into account the current reality of her situation at Kleiner Perkins.

“I am routinely cut out of meetings and other KP partners fail to attend meetings I request,” she said in requesting a reassessment.

In late September, Kleiner Partner Matt Murphy wrote to Schlein: “We’re about a week away from the 60 day mark we established to reassess P’s performance.” A week later, Pao was fired.

Both sides in the case weave vastly different stories from the same events. During a 2009 conference, organizers requested that Pao move from a front table with several of her colleagues and sit in the back without them. In her court filings, Pao cited the incident as an example of the discrimination she faces. In contrast, Schlein testified that he didn’t think it was a big deal.

“Ellen is very sensitive about her status,” he said in an email shown in court. “I believe this is a personal fault of hers.”

He elaborated when questioned by the Kleiner attorney that the organizer of the event was “very controlling about who does what, who sits where.” Asked why he didn’t sit in the back of the room, Schlein, a far more senior venture capitalist, responded, “That’s not how the meetings work.”

(This story was updated with additional information and to clarify the arguments by both sides of case)

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