Venture capitalist Justin Caldbeck, the co-founder of Binary Capital who was accused this week of sexually harassing half a dozen women who work in tech, will take an “indefinite leave of absence” from the San Francisco firm he helped start three years ago and will seek “professional counseling,” according to a news release.
Caldbeck, who has served on the board of directors at several local startups, including on-demand labor market TaskRabbit, said in a statement Friday afternoon that the decision to step down from his firm was preceeded by “the darkest” 24 hours of his life.
Those hours came after Susan Ho, Leiti Hsu, Niniane Wang and three other women who declined to share their names publicly, spoke out about several instances where Caldbeck harassed them. The allegations include groping a woman under a table, sending sexually explicit late-night messages and propositioning female entrepreneurs for sex.
Several of the women reportedly experienced Caldbeck’s unwanted advances as they were seeking funding or advice from him in his role as a venture capitalist while they were trying to start a business.
“Leiti and I originally were not going to say anything because we felt that what happened to us was just unfortunately so commonplace and trite these days,” Susan Ho wrote in a private Facebook group, according to tech news site PandoDaily. “But after hearing the stories of other women who endured much worse, we decided we had to say something to make sure this article would get written. Niniane Wang was the first to agree to go on the record and she said it best — if we don’t say anything and this happens to someone else, it’s really something we could have had a hand in preventing.”
Caldbeck has worked as a VC three firms over the past decade: Bain Capital Ventures, Lightspeed Venture Partners and his own firm, Binary Capital.
Prior to Caldbeck’s announcement Friday, Binary Capital denied the women’s allegations, calling them “false,” and characterized Caldbeck’s actions as flirtation.
The women’s stories, first reported in the Information, a subscription news service for venture capitalists and other tech insiders, have since made their way around the Internet, attracting outrage from many in the tech industry, who decried Caldbeck’s actions but said they found them unsurprising, given the systemic and pervasive sexism and misogyny many have long reported experiencing in tech and venture capital.
Two of the six women who reported inappropriate advances from Caldbeck said they did not follow through on business deals with him because of his inappropriate behavior.
In a statement Friday, Caldbeck said he was “grateful” to the women for speaking up and “deeply ashamed.”
“The power dynamic that exists in venture capital is despicably unfair. The gap of influence between male venture capitalists and female entrepreneurs is frightening and I hate that my behavior played a role in perpetrating a gender-hostile environment,” Caldbeck wrote in his statement. “It is outrageous and unethical for any person to leverage a position of power in exchange for sexual gain, it is clear to me now that that is exactly what I’ve done.”
Caldbeck has invested in 14 startups through his firm, Binary Capital, including photo- and video-sharing app Snapchat, interior design startup Havenly, on-demand transportation startup Bellhops and luxury-hotel startup Recharge.
Binary Capital, based in the Mission District, is an early-stage investment firm that focuses on consumer-facing businesses. It has invested more than $300 million in the past three years. Among its limited partners, or investors, are the University of California at Los Angeles and Weathergage Capital, a firm whose five managing directors include three women.
“I will be seeking professional counseling as I take steps to reflect on my behavior with and attitude towards women. I will find ways to learn from this difficult experience — and to help drive necessary changes in the broader venture community,” Caldbeck wrote. “I apologize again to those who I’ve hurt during the course of my career — and for the damage I’ve done to the industry I care so deeply about.”