The controversy over Coinbase’s stance against corporate social responsibility
This is the web version of Term Sheet, a daily newsletter on the biggest deals and dealmakers. Sign up to get it delivered free to your inbox. Corporate social activism has been on the rise.
Corporate social activism has been on the rise.
But Coinbase, a cryptocurrency exchange startup last valued at $8 billion, is taking a unique stance.
In a post Monday, CEO Brian Armstrong wrote that the company has faced difficult questions about how to engage in today’s “broader societal issues.” The company has, he noted, experienced employee walkouts.
So Armstrong said Coinbase would focus on building the company’s core mission: “Using cryptocurrency to bring economic freedom to people all over the world”—and engage “minimally” around policy decisions, non-profit work, and political causes. Some Coinbase employees, he wrote, may have previously interpreted this mission to be more encompassing of “all forms of equality and justice,” though that is not what he intended it to mean.
“It has become common for Silicon Valley companies to engage in a wide variety of social activism,” he wrote. “While I think these efforts are well intentioned, they have the potential to destroy a lot of value at most companies, both by being a distraction, and by creating internal division.”
And… well… that set off a firestorm, with some hailing the post as a contrarian and mold-breaking, and others decrying the post as a mark against diversity.
Many in the Libertarian-leaning part of venture capital that gave the post a thumbs up, praising the separation between social activism and company operations.
Paul Graham retweeted the note, adding: “Yet again, @brian_armstrong leads the way. I predict most successful companies will follow Coinbase’s lead. If only because those who don’t are less likely to succeed.” Long Journey Ventures’ Cyan Bannister opined: “This makes me very bullish on Coinbase! It’s about damn time a company took a stance like this.”
But on the other side: “In a nutshell, this one is a lot to unpack and I hope they will revisit it because… well… I think they should and can do better,” Kimberly Bryant, CEO of Black Girls CODE wrote in a Twitter thread. “Hey everyone who says that they equally scrutinize male leaders for building poor company cultures, where is your coverage of this trash?” wrote Sarah Mauskopf, CEO of Winnie.
I’ve reached out to Coinbase for more background on Armstrong’s post—and concrete answers on what exactly fits within the purview of the company’s mission. The CEO previously tweeted “Black Lives Matter” in response to the killing of George Floyd in June, stating Coinbase planned to make a $250,000 donation and match up to $250,000 to causes chosen by employees. The company though, has declined to comment further than Armstrong’s post.
“I recognize that our approach is not for everyone, and may be controversial. I know that many people may not agree, and some employees may resign,” wrote Armstrong in his post.
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