Monday, March 26, 2007

"Silicon Valley Not So Sure of This Clinton"

Wall Street Journal:
SUNNYVALE, Calif. -- For a woman striving to shatter the ultimate glass ceiling, Sen. Hillary Rodham Clinton is getting a surprising rap among some here in Silicon Valley: "old-guard."
This is Clinton-Gore country -- or it was once. Now, several of former President Bill Clinton's earliest and biggest fund-raisers -- such as Sandy Robertson, founder of investment bank Robertson Stephens and a partner at technology buyout firm Francisco Partners; and Steve Westly, an ex-eBay Inc. executive and former controller for California -- have defected to Illinois Sen. Barack Obama. Others, including venture-capitalist John Doerr and Apple Inc. boss Steve Jobs, are staying conspicuously neutral, possibly waiting to see if their friend Al Gore enters the race.

"Barack Obama may just be the man of our times," says Mr. Robertson, one of President Clinton's largest fund-raisers throughout the 1990s.

Sen. Clinton's early trouble nailing down this high-tech pillar of her husband's base shows how the Obama campaign is confounding some of the New York Democrat's best-laid plans -- here and elsewhere. Up the highway in San Francisco, Sen. Clinton enjoys backing from traditional Democratic donors like real-estate magnate Walter Shorenstein and Susie Tompkins Buell, co-founder of clothing retailer Esprit de Corp.

But here and in places like Hollywood and Wall Street, Sen. Clinton appears to be having problems matching Sen. Obama's success at connecting with newly wealthy younger people -- a potential pitfall for her as the candidates enter the final week of fund-raising for the first quarter.

Some of Silicon Valley's business-minded Democrats, citing health-care proposals Sen. Clinton made while first lady, worry she is too ideological and would govern from the left. Other local Democrats who have met the 59-year-old senator say she can be warm and brilliant in person, but often appears cold and calculating on TV, causing them to question her electability.

Many doubters are gravitating to Sen. Obama -- but not necessarily for his policy positions. In fact, Sen. Obama was recently ranked more liberal than Sen. Clinton by the magazine National Journal in its annual survey of political ideology. Sen. Obama's life story as a bridge between cultures and races is resonating in this global hub of high technology.

"Silicon Valley invests in high-powered intellects who are effective at bringing big new ideas to market," says Frederick Baron, a lawyer and Obama fund-raiser who spent two years in the Clinton Justice Department. "In the lexicon of high tech, Barack Obama is the next-generation solution."

Sen. Obama is particularly popular among techies under age 35, a largely untapped market for political cash. Organizers say about a quarter of the 700 guests at a recent $1,000-a-plate fund-raiser for the 45-year-old senator were under 35. "It's exciting to see a candidate younger than our parents," says 23-year-old Joe Green, an Internet entrepreneur who brought 10 friends to the event and who plans to hold an Obama fund-raiser featuring young Internet executives soon. "People around here are apathetic; they think technology changes the world, not politics. Obama is the first candidate people are saying, 'Wow, we should check him out!'"

Even pro-Clinton families in the area are finding their younger generations turning to Sen. Obama. Justin Buell, the 26-year-old stepson of Mrs. Tompkins Buell, says he decided to support Sen. Obama the moment the senator declared his presidential exploratory committee in January -- even though it meant a family schism.

"I wanted to do everything that I could" for the senator, says Mr. Buell, a law student who recently co-hosted a fund-raiser for Sen. Obama. While "there's a break in the family and dinners are spirited ... we (my parents and I) just have a different idea of what makes the best candidate."

Sen. Clinton isn't giving up. She raised $1 million at two small Silicon Valley events over the weekend. At a gathering in Woodside, the hosts included Ms. Tompkins Buell and Mark Chandler, a senior vice president at Cisco Systems Inc. Charles Phillips, president of Oracle Corp., was among the hosts of an event in Redwood City.

Although several of her husband's longtime backers in the area remain uncommitted or aren't supporting her, the candidate is building her own Silicon Valley network, led by the growing ranks of women executives at technology companies, supporters say. "Hillary's been in or near public service for 20 or 30 years; that kind of experience is important for running a country," says Sheryl Sandberg, a senior Google Inc. executive and Clinton campaign fund-raiser, who was chief of staff for former Treasury Secretary Lawrence Summers.

Sen. Clinton has some big guns at her disposal. Earlier this month, Larry Stone, one of President Clinton's earliest and most prolific fund-raisers in Silicon Valley, was summoned to a private meeting with the former president. Mr. Stone says he told Mr. Clinton he wasn't ready to sign on to Sen. Clinton's campaign. Still, as they browsed in a Monterey, Calif., bookstore, Mr. Clinton pressed his wife's case.

"He said [John] Edwards and Obama are young and good looking, but Hillary has the experience," says Mr. Stone, a local politician and real-estate developer. He says Mr. Clinton was "persuasive," but Mr. Stone declined to commit, because he worries Sen. Clinton isn't electable.

Other Democrats with White House ambitions are looking to tap into Silicon Valley support. Sen. Christopher Dodd of Connecticut addressed a small group of tech executives over lunch recently at venture-capital firm Kleiner Perkins Caulfield & Byers. Former North Carolina Sen. John Edwards did a fund-raiser at the home of financier Andrew Rappaport.

Among Republicans, former Gov. Mitt Romney of Massachusetts is seeking out support from fellow alumni of the management-consulting firm he once ran, Bain & Co., including top eBay executives Meg Whitman and John Donahoe. Rudy Giuliani, the former mayor of New York, has the backing of venture capitalists Floyd Kvamme and Tim Draper. Sen. John McCain of Arizona counts John Chambers, CEO of Cisco, in his corner.

At stake is more than money. In the 2004 election, software, computer and Internet companies ranked 13th among industry sectors as sources of campaign funds, lagging far behind, for example, the legal (first) and financial (fifth) industries, according to the Center for Responsive Politics in Washington. But campaign experts say Silicon Valley offers candidates something unique: a place -- or at least an image -- on the cutting edge.

Many Silicon Valley Democrats say they had hoped former Virginia Gov. Mark Warner would enter the race. A Southern moderate, he earned his fortune investing in cellular phone companies. But when he and another favored centrist, Indiana Sen. Evan Bayh, decided not to run -- and Sen. Obama went for it -- "the real movers in political fund raising suddenly rallied to Obama," says Mr. Baron, the Silicon Valley lawyer and a veteran political bundler.

Part of Sen. Clinton's trouble is the perception here that she is an ideological liberal. Obama fund-raiser Wade Randlett, co-founder of Technology Network, a Silicon Valley trade group, says he and other early Bill Clinton supporters viewed the former first lady as an impediment to their pro-business agenda during Mr. Clinton's first term. On health care, tort reform and fiscal policy, Mr. Randlett says, Mrs. Clinton tried to pull the president to the left. "It was the East Wing vs. the West Wing," he says.

Sen. Obama's supporters acknowledge their candidate is largely untested on policy matters, and there is no certainty that he would be more conservative than Sen. Clinton on health care, tort reform or fiscal policy. It is his persona, they say, that is generating excitement.

"No one's calling me about Barack's stands on business or tech issues," says John Roos, the Obama point man in Silicon Valley and chief executive of the law firm Wilson Sonsini Goodrich & Rosati. "This is a phenomenon of a ... leader of a new generation who has the potential to bring this country together."

Sen. Clinton's supporters say the attraction is sure to wear thin. They also say the former first lady has gotten a bum rap as an old-guard liberal. "She was far less of a policy person than people think," says David Barram, a former chief financial officer of Apple and senior Clinton administration official.

Beyond the contenders, it is Mr. Gore, a noncandidate, who may carry the most political sway in Silicon Valley these days. A part-time resident of San Francisco, where he owns a home and co-founded a cable news network, Mr. Gore is a paid adviser to Google. He sits on the board of Apple, and is an apostle of clean energy -- the latest fever sweeping venture-capital investors.

Many people assume Mr. Gore's presence explains why Messrs. Jobs and Doerr and Google CEO Eric Schmidt, all close friends of the former vice president, haven't endorsed a candidate. Associates of those men say Mr. Gore has requested no course of action of them.

"I'd like to see some people talking about how we in the tech industry spur innovation in this country," says Hewlett-Packard Co. CEO Mark Hurd, who hasn't endorsed a presidential candidate. "I would sign up for that."
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