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When bad press comes, leave out insults and quell urge for “Jerry McGuire moment”

It's not a good year for tech bosses, with Dave McClure, founder of 500 Startups, and Binary Capital co-founder Justin Calbeck the latest to be accused of sexual harassment. And in trying to stem the resulting bad press, Calbeck’s corporate partner, Jonathan Teo, wrote an email he might regret.
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Both McClure and Calbeck apologised to those who brought the allegations forward. McClure resigned in a blog entitled I’m a creep. I’m sorry – really, that’s what it was called – and Calbeck professed he was “deeply ashamed.” But in trying to combat the resulting bad press, Theo sent an email of angry and insulting proportions.

Of course, when bad press is unleashed upon your company, one of the first things you do is address your clients. Customers are drawn to businesses with a good reputation, and when a company or its management has been found wanting, they will expect someone to take responsibility for the mess and advocate real change.

Take Uber’s way of addressing sexual harassment as an example. It seemed only seconds after Travis Kalanick stepped down that Uber embarked on an overhaul. It hoped to tackle its toxic culture by accepting all 47 recommendations set out in a company report – all of which it shared to the public.

Often bosses feel compelled to write to clients or staff to give further information and to apologise for any inconvenience or wrong-doings. It often makes more sense to hear it from the top honcho instead of via a press release. But if it’s your company-saving method of choice, then Teo’s recent email highlights how you should never craft one in light of bad press.

While the email was supposed to reflect upon those oppressed by Silicon Valley behaviour and suggest the “public story should be revised”, it sounded more like he had enough of people demanding his attention – and that those wishing to buy back their shares would be deemed “dishonourable”.

In fact, many have pulled the email – published on Axios – apart, suggesting how unapologetic it was. According to Fortune journalist Erin Griffith it dripped of anger and, “in parts it was barely coherent. He even blames the ‘corrupted’ media for his resignation offer – something he noted has yet to be accepted.”

The BBC also quoted journalist Mike Malone as saying Teo was having a “Jerry Maguire moment”. He told the company: “He was obviously having a very bad day – not a great state to address bad press in. He says he’ll resign, then turns around and says it’s not his fault at all, that everyone is conspiring against him including the media.

“If you were teaching PR 101 this guy has just done everything wrong. He has insulted clients, he has insulted investors, he has insulted employees and he has insulted the media. This is a venture capital fund and venture capitalists live and die by the amount of money they can raise for their next fund.”

What’s more, Teo scored no points by alluding to CEO Shane Mac’s request for a female portfolio manager as “moronic”.

Here’s a small excerpt from his email to clients:

“The story in the public that you are all trying to buy back shares should be revised. Not for my sake. If that’s what any of you want, ok, but know this. I strongly urge you not to be considered part of a group of entrepreneurs that would, at the first sign of trouble or opportunity, choose to renege. It is dishonorable. And it is opportunistic grandstanding. It will hurt the perception of your integrity and it will hurt your ability to raise capital down the line.

“No investor seeks out that risk. It’s not an action of integrity. I would urge you to separate yourself from that narrative if it isn’t true of your intentions. If it is, I hope you have a very credible reason to do it besides just doing a shakedown, or to stand outside your integrity for the sake of media perception. I also recommend you speak to each reporter who has quoted that erroneous article and have it corrected.

“What I think is that we are an industry full of entitled human beings. Particular to Silicon Valley but not exclusive to it. There are victims out there paying for oppression with their lives. As for the people here that whine that they aren’t taken care of, who have not to worry about their lives being taken from them or their basic needs met, who owes them more than the voice they already have access to? To these whiners who want me to constantly address their questions preemptively, I say that we all have priorities.

“Even I do. I spend my time working through those priorities. And maybe there are priorities beyond your personal feelings. I would love to get to them, but maybe I just have not prioritised it high enough. If you feel that, reach out, don’t whine about what you expect me to do.”

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Shané Schutte

Shané Schutte is a senior reporter at Real Business, with a particular specialism in employment and business law, human resources, information technology and sales/marketing.

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