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“Unions Are Often Necessary. And Sometimes Wonderful.”

An interview with Roy Bahat, the renegade venture capitalist who believes in labor unions.




Roy Bahat at his home in San Francisco. Photo by Mitch Tobias.

Roy Bahat has some important advice for his colleagues in the tech world that runs against the philosophical grain of most upstart entrepreneurs. If your employees want to unionize, Bahat told a recent conference of investors and company leaders, “The old playbook is not going to work.” If workers, people whom Bahat refers to as “talent,” want to organize for a new type of power, one of the things senior executives shouldn’t do is “let lawyers run the process” of responding to the unionizing efforts.

While Bahat, who runs an early-stage venture capital firm called Bloomberg Beta, would not be mistaken for Eugene Debs in his union advocacy, he is the rare Silicon Valley investor who believes that it is possible for unions and tech companies to develop productive partnerships. A former Rhodes Scholar, Bahat has done a great deal of thinking about the future of work and believes technology does not have to engender a race to the bottom for American workers.

Bahat has talked to labor organizers, leaders and young people who want more dignity in the workplace; he has even invested in a company that was established to help workers organize independent unions. With workers organizing at Amazon, Apple, Starbucks and Microsoft, Bahat has emerged as a voice of reason about how the evolving economy can serve the vast majority of people. Capital & Main spoke to Bahat from his home in San Francisco.

Note: This interview has been edited for length and clarity.

Capital & Main: You attended the Labor Notes conference in Chicago recently. Labor Notes is a group of activists who refer to themselves as “militants,” though some of them prefer the term “revolutionaries.” As a venture capital investor, what did you say to them and what did they say to you?

Roy Bahat: Four thousand people were at that event so it’s hard to characterize them as having any one point of view. The thing that struck me was how practical people seemed to be. The way I think about it is that working people have wants and needs. Organizing is one of the ways that they expressed those wants and needs, so the reason I went to Labor Notes was to understand what was happening.

What I heard was a lot of people trying to figure out how we communicate with other people who work for the same workforce. I went to sessions on how you use audio to build solidarity in a workforce. How does organizing differ in the health care industry versus the technology industry? We’ve also invested in companies that serve working people’s desire to organize. There was just this feeling of electricity in the air and a desire to seize the moment.

What companies have you invested in that are designed to help workers organize?

There is a startup company called Unit that is a service for people who want to form small, independent labor unions. They help with things like government filings and conducting a union election so workers don’t have to contact a lawyer. There is also a company called Open Collective that hosts, among other things, mutual aid societies. The big theme is that working people want to be served better, and one way they’ll be served is by labor unions. Another way they’ll be served is through nonprofits or other companies that offer services to them.

“One reason why our firm is focused on the future of work is because I saw these ways that technology was shaping our family lives and our lives as shoppers but was failing to improve our lives at work.”

You are part of Silicon Valley as an investor. Ideologies function in part to legitimize the social and economic relations that exist. Is there an ideology that dominates the tech world? Is there any truth to the cliche that they are benevolent disruptors that transform outmoded ways of doing business through technological innovation?

There are many ideologies in different places in the tech world. To the extent there’s a dominant ideology, I would say it’s the promotion of technology. People have different political stripes and economic beliefs. One of the things that attracted me to the tech world is that I didn’t see it as a particularly ideological place. I saw it as a place that was focused on trying to make things that help people and doing it in an exciting way that felt modern and fresh.

I don’t consider myself to be a particularly ideological person. I’m a person who wants things to be better and looks for the tools available to do that. One reason why our firm is focused on the future of work is because I saw these ways that technology was shaping our family lives and our lives as shoppers but was failing to improve our lives at work.

One of the things that puzzles a lot of people is that a guy like Jeff Bezos can be pro-women, pro-Black Lives Matter, pro-environment, pro-LGBTQ and he receives awards from all of these different organizations. The one thing he can’t be is pro-union, since such organizations redistribute wealth from owners and investors to workers and their families. This attitude seems pervasive in many tech companies.   

There is a general business ideology that is a knee jerk reaction of hating unions. I’m a person who tries to study the changes happening in work and figure out how things can be better. One of the changes that I’ve seen is a rise in all kinds of labor organizing, union and otherwise. My guess on why business in general feels this way is partially their lack of familiarity. And the history of unions in the United States is not unambiguously positive.

Wealth is also part of it. It’s also about sharing power. One of the things that I think has served the startup world well is when the founders of companies are powerful. I think unions call that into question. I think that the CEOs of the future are likely to be more skilled in how to collaborate with an organized workforce because that seems to be what a lot of working people want. It’s part of my role to help CEOs write a new playbook.

You were part of the Shift Commission on the future of work, convened by Bloomberg Beta and Anne-Marie Slaughter, CEO of the think tank New America. What was it and what were the central findings?

The central finding was that the future of work is already here. Instead of worrying about the robots taking all the jobs, let’s worry about the ways in which the technological forces that have already acted on the economy have failed to serve people. Companies need to act, governments need to act, and organized labor needs to act as the future of work is already here.

“In many places where workers try to unionize, management is Googling ‘What’s a union?'”

There’s a wonderful short story by E.M. Forster called “The Machine Stops,” written in 1909. People are living underground and a powerful machine has taken over providing the sustenance of life. It’s about how “the robots are coming” but also about how humans have lost access to what the philosopher Michael Polanyi calls “tacit knowledge,” the practical knowledge that we often don’t even know we have.

The robots are already here so it’s already happening. I think the loss of tacit knowledge is a really important thing, and there are plenty of examples in history of humanity losing the ability to do things that we once knew how to do. The biggest issue is what if the operation of our markets produces an economy where the typical person who works hard can’t provide for a family and live with stability and dignity. If that happens, it’s a crisis, and that’s arguably the world we already live in.

You are a pro-union venture investor?

I’m pro-worker. I’m pro-democracy. And my feeling about unions is I think unions are often necessary. And sometimes wonderful. People assume I’m pro-union because I’m not anti-union. In many places where workers try to unionize, management is Googling “What’s a union?” So, unions can be great and can be terrible depending on how we shape it.

Well, someone could read some of the things you say and conclude that “Roy thinks that we can talk people into being better and nicer people.” But American labor history is one of the most violent and bloody class struggles anywhere in the world. Most owners have an intense focus on controlling the workforce, controlling the work process and controlling the products of work. They wouldn’t be good capitalists if they didn’t do that.

What I’m saying is that the core thing to me is to be pro-worker, which is what is good for the lives of people generally.

That’s what Howard Schultz, the CEO of Starbucks, says, and he is opposing the Starbucks union. 

I start from that place and I get to a very different place. The place that I get to is that working people seem to be saying they want to organize. So that is a critical factor to take into account. If working people want to organize and unionize then they should organize and unionize.

There are plenty of cases where it can be a good thing for the companies that are open to collaborative partnerships. Do I think they’re going to be cases where there’s conflict? Yes. I’m not saying that if we can talk nicely to people then everything will be fine. I am saying that I think mutual understanding can make things a lot better but sometimes there is going to be conflict.

“One of the reasons I’m drawn to entrepreneurs is that they are underdogs trying to prove something when the odds are stacked against them. I’m drawn to the stories of these labor organizers for exactly the same reason.”

You are using your personal money to fund writers and filmmakers to tell stories about labor. Why?

Telling stories is one of the ways we move our world forward by these acts of imagination. Those acts of imagination burrow deep into our brains and help guide our actions whether it’s short stories, films or TikTok. And so part of the reason why I want to support storytellers is I want to be able to imagine different futures.

With respect to labor stories, it’s an area where I think our lack of imagination is hurting. The stories we tell about labor are as outdated sometimes as labor law. It’s one of the reasons why I think what’s happening at Starbucks or at Amazon is so profound. Those organizers are telling new stories.

I interviewed a number of Starbucks workers in Buffalo, New York, recently. They were young, mostly women. Their language was very straightforward, with a lot of focus on dignity in the workplace. What’s your sense of this new generation of organizers?

The most important thing is that they tend to be women and people of color. I feel a lot of the same energy from them as I do from people who are making new technology. So it’s intense idealism and intense amounts of pragmatism. With Starbucks I’ve heard from many organizers that they actually love the company. That’s their word, not mine. They believe they’re doing what’s in the best interest of the company.

One of the reasons I’m drawn to entrepreneurs is that they are underdogs trying to prove something when the odds are stacked against them. I’m drawn to the stories of these labor organizers for exactly the same reason.

One of the books that is on your recommended books page is Hegel’s Philosophy of History. A theme of that dense book is how things that are latent in the world become actualized. Is that why you were interested in Hegel?

The main reason is this dialectic progress of history, two sides in conflict with one another. If any one philosophy becomes too powerful, its own internal contradictions end up pulling it down. One of the challenges that we’ve had in our modern business world is not enough balance of power, too much concentration of power. Working people having power and finding a seat at the table is the chance to balance power more equitably. That’s the dialectic I want to see.

There’s a famous phrase of Hegel’s that I’ll paraphrase — “The owl of Minerva flies at dusk” — which I take to mean that we live our lives forward but only understand the narrative of our lives, or of history, by reflecting backwards. As you look back on your experience and on American history, what helps you understand what might occur in the future?

That’s an amazing question, and I don’t know that I have any great wisdom on it. By nature, I spend a lot more time looking forward than looking back. The future is always more valuable to me than the present. That said, I think unmet wants are this great potential energy that drives all these different desires for change. When large numbers of people have an unmet need, it’s this great force of people wanting to make a new technology or of people wanting to organize.

I see those unmet needs also as the cause of political extremism in the United States and elsewhere. Today in the United States, I think the most significant unmet need is that typical people who work hard can’t reliably provide for their families and live a life of dignity. I’m looking at every possible tool that can meet that need.

Copyright 2022 Capital & Main

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