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Thiel is at center of Silicon Valley storm after backing Trump with $1.25 million

Billionaire Peter Thiel's $1.25 million backing of Donald Trump's presidential campaign has caused rifts in Silicon Valley.

Over the weekend, news broke that Thiel — co-founder of PayPal and chairman of start-up Palantir — had donated $1.25 million in support of Trump.

Thiel already voiced his support for Trump at the Republican National Convention. But his donation is an outlier in the tech world, which had donated around $8 million to the campaign of Democratic presidential candidate Hillary Clinton, versus $300,000 to her rival, according to Recode, citing Crowdpac data.

Thiel is a part-time partner at Y Combinator, a major Silicon Valley start-up accelerator run by Sam Altman, who tweeted on Sunday that Trump's views are an "unacceptable threat to America." But Altman added that he would not fire Thiel because it's a "dangerous path to start down."

Altman's comments about Thiel drew the ire of Ellen Pao, co-founder of Project Include, a company working to help tech organizations become more diverse. Pao was the former chief executive of Reddit — the site that bills itself as the "front page of the internet." Last year, Pao was locked in a discrimination lawsuit against her former employer, venture capital firm Kleiner Perkins Caufield & Byers, which she subsequently lost.

In a blog post on Monday, Pao hit out at Altman's decision not to fire Thiel, as well as the latter's support for Trump.

"While all of us believe in the ideas of free speech and open platforms, we draw a line here. We agree that people shouldn't be fired for their political views, but this isn't a disagreement on tax policy, this is advocating hatred and violence," Pao wrote.

Peter Thiel, co-founder of PayPal, delivers a speech during the evening session on the fourth day of the Republican National Convention on July 21, 2016 at the Quicken Loans Arena in Cleveland, Ohio.
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Peter Thiel, co-founder of PayPal, delivers a speech during the evening session on the fourth day of the Republican National Convention on July 21, 2016 at the Quicken Loans Arena in Cleveland, Ohio.

"Giving more power to someone whose ascension and behavior strike fear into so many people is unacceptable. His (Trump's) attacks on Black, Mexican, Asian, Muslim, and Jewish people, on women, and on others are more than just political speech; fueled by hate and encouraging violence, they make each of us feel unsafe," she wrote.

Trump was caught up in a storm earlier this month when a recording obtained by NBC News showed him boasting about groping women. Trump apologized for these "foolish" remarks, chalking them up to "locker room talk."

Pao's Project Include works with the start-ups that come out of Y Combinator to help them build diverse organizations. The firm runs a program called "VC Include," which has venture capital firms on board. They make a commitment to promote diversity in the start-ups they back. Pao said she had invited Y Combinator to be a contributor to the VC Include program. But now, Pao said, her company is going to cut ties with Altman's firm.

"Thiel's actions are in direct conflict with our values at Project Include. Because of his continued connection to (Y Combinator), we are compelled to break off our relationship with YC. We hope this situation changes, and that we are both willing to move forward together in the future. Today it is clear to us that our values are not aligned," Pao said.