Mozilla's Mark Surman rethinks venture capital

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Right now seems like a moment of unique opportunity for many internet entrepreneurs. Hundreds of thousands — perhaps millions — of Twitter users are looking for a platform to make their new online home amid Elon Musk’s revolution on the platform. But for many of Twitter’s traditional users, nothing seems to fit the bill. Mastodon is too complex. Facebook is for boomers. LinkedIn is too professional.

One of the many reasons why a viable alternative isn’t ready to pounce is that the traditional venture capital (VC) firms that have funded Silicon Valley’s biggest hits often prioritize the prospect of a return on investment over sound ethical decision-making. If an alternative to Twitter were to facilitate healthy conversation, avoid targeted advertising, and make it harder for polarizing content to go viral, the company behind it would simply be less profitable. As a result, founders looking to raise investment for such projects often fall at the first hurdle.

At least that’s the view of Mozilla, a hybrid organization that includes a nonprofit foundation and the corporation behind the privacy-focused Firefox web browser. On Nov. 2, Mozilla set out to change that state of affairs by launching its own venture capital arm, Mozilla Ventures, which will inject much-needed investment into companies that “can ultimately push the Internet in a better direction.” according to a statement accompanying the launch.

With an initial funding round of $35 million, Mozilla Ventures isn’t as strong as Silicon Valley’s VC giants. But Mark Surman, president and CEO of the Mozilla Foundation, is optimistic that the money will have a big impact on projects trying to make the Internet safer. “Venture capital as it’s formed right now, this pursuit of profit at all costs, ultimately leads to things like the failure of Twitter and the monopolies we have today,” Surman told TIME in an interview on Oct. 27, the day that Elon Musk has completed his acquisition of Twitter. “So not only is there a consensus that we need a different kind of tech industry, I think it’s also clear that we need a different kind of investing to achieve different outcomes.”

Mozilla Ventures has already announced its first three investments, with more to be announced next year. One of the beneficiaries is Block Party, an app that helps users protect themselves from bullying on social media. Its founder, Tracy Chowwas named TIME’s Woman of the Year in 2022. “We will use [the money] to hire and execute the things we want to do faster,” Chow told TIME.

This interview has been shortened and edited for clarity.

Why are you starting Mozilla Ventures?

We’re seeing a lot of startups looking to tackle things like privacy, reliable AI, and Twitter alternatives. The founders are there. We’ve met a lot of them over the past few years. But they really struggle to find capital that fits their values ​​and that will support them to be ethical technology companies.

It feels like there’s a consensus that we need to push the tech industry in a different direction. The question now is how will this be done? And it’s clear that some of that can happen through regulation. But it also has to happen through people creating different products that still delight people and that people want to use, but also products that respect people and protect them.

There are very few people who won’t say, “I want the Internet to work differently” right now. But venture capital as it is currently formed, this pursuit of profit at any cost, ultimately leads to things like the failure of Twitter and the monopolies we have today. So not only is there a consensus that we need a different kind of tech industry, I think it’s also clear that we need a different kind of investing to achieve different outcomes.

So what is the difference between Mozilla Ventures?

At the simplest level, this would be investing through the lens of Mozilla’s manifesto. So there are 14 principles, such as privacy, human dignity, transparency, etc. And we first look at the company through this lens. Is there something about their vision and their product that promotes one of these principles? And does what they do harm any of them? We put the same mission filter that we put on ourselves on these companies. And then we look at whether there is a good founder? Is there a good team? Do they understand the market? Are they likely to have a niche and a business? That’s really the only thing that’s different: applying the values ​​we apply to our products to companies we could invest in. And then doing the normal kind of checking that it’s a good investment.

What companies have you already invested in?

So there are three companies that we have already invested in. One is called Secure AI Labs, which is in the business of doing biomedical research with patient data in a way that is extremely privacy-friendly. It is also patient-friendly because it works with non-profit patient advocacy groups. There is great opportunity in AI and big data for pharmaceutical biomedical research for health breakthroughs, but a huge problem with it [that it’s] some of the most sensitive information about us. So it’s about bridging the gap between something that’s a really big promise of AI and something that’s a huge privacy problem for AI by building a trust layer in the middle.

The second is a company called Block Party, founded by Tracy Chow, who is well known as a spokesperson for online safety. She had to face online bullying on her own. Block party is primarily a tool to help people mitigate online bullying, currently on Twitter, but I’m looking to move to other platforms as well. It’s sort of a personal safety tool for living in the internet world.

And the third is a password management company called heylogin. And, you know, their innovation is really to make password management hyper simple. Everyone thinks we need better individual security, and that means better passwords, two-factor authentication, all that stuff. But password managers really are a pain in the ass. And so they use the encryption technology that already exists on smartphones, and then biometric recognition, facial recognition or fingerprint recognition, as a way to reduce the strain on the password manager. Unlike Apple or Google keychains, it works across platforms.

I want to reduce here. Elon Musk bought Twitter. Facebook’s rating went through the floor. Do you feel that this moment right now is a unique moment of opportunity for new ventures?

Yes, I definitely think this is a unique moment of opportunity. First, because what is happening shows the absolute pressing need for alternatives, and those alternatives will not emerge unless there are founders and companies building them. And the founders won’t build them unless there’s money to match their vision. We were in an era of insane growth and profits in the tech industry. At the present time I doubt whether this will be delayed for a moment or for long. But even if it slows down, technology is part of our lives and will be profitable. So a venture fund that’s not necessarily looking for the huge cryptocurrencies, but just looking for a good business, a good investment and a good return, that’s the era I think we’re maybe entering. There are still good investments, but not crazy ones. And not profit at all costs.

The win-at-all-costs mentality of seeking huge odds of risk money has led to the growth of the surveillance economy, data hoarding, unreliable AI, and all that stuff. So I think we still need to be trading and creating wealth, but we don’t have to be crazy, as I say.

Where does this lead Mozilla as an organization? What is Mozilla’s vision for the future? And how does this fit into it?

Mozilla’s vision for the future is that we can have an Internet that is joyful and enjoyable, but also respectful and personal. And we’re working on new products outside of Firefox to make that possible. But we also know that even if Mozilla is wildly successful at creating responsible technology products—even if we have 10 of them, we need 100. We need 1,000. We actually need more of us to succeed at this. . So the game here is hopefully we can help some of these founders and teams be the next Firefox in this era, but also encourage other investors to look at the opportunity and the need.

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Write to Billy Perrigo c [email protected].

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