If Silicon Valley is sincere about “changing the world”, it should return Saudi billions until alleged murder of Jamal Khashoggi has been suitably investigated
Technology companies can no longer turn a blind eye to the human rights abuses of one of their largest investors.
Context & Ripple Effects
This New York Times opinion piece landed at the peak of the Khashoggi crisis, arguing that tech companies should return Saudi money until the alleged murder was properly investigated. It was aimed squarely at the SoftBank Vision Fund, which had received $45B from Saudi Arabia and sat atop the startup funding stack as the largest source of US venture capital.
What makes the piece worth revisiting is how completely its demand failed: days later Silicon Valley was mostly quiet about its Saudi ties, startups like View and Zume kept raising $1.5B from Saudi-backed vehicles, and the pattern held through 2019 — before a16z began openly courting Saudi money in 2023.
First-order effects
- SoftBank and its Vision Fund portfolio companies faced immediate reputational pressure to disavow or return Saudi capital, with the fund's $45B Saudi commitment making any clean break financially implausible.
- US startups in active fundraising rounds suddenly had to weigh public association with Saudi money against their cost of capital.
Second-order effects
- Because no major recipient returned funds — View, Zume, and later Flexport's reported $500M round all proceeded — the boycott call collapsed, signaling to other VCs that Saudi capital carried little lasting penalty.
- Saudi Arabia retained leverage over the venture ecosystem: with the Vision Fund as the dominant growth-stage check-writer, founders who refused Saudi-linked money risked being outcompeted for capital by those who didn't.
Third-order effects
- The episode established that moral controversy over sovereign investors does not structurally alter venture funding flows — by 2023 the dynamic had inverted, with prominent US firms actively seeking Saudi backing rather than avoiding it.
- Sovereign wealth funds became embedded in the venture capital structure itself, meaning future human-rights controversies will surface as questions about LP governance rather than one-off withdrawal decisions.
The trend: US venture capital has moved from publicly debating whether to refuse Saudi sovereign wealth after Khashoggi's murder to openly competing for it, absorbing ethical controversy into the structure of startup finance.