Evan, a high school sophomore from Houston, was stuck on a calculus problem. He pulled up Answer AI on his iPhone, snapped a photo of the problem from his Advanced Placement math textbook, and ran it through the homework app. Within a few seconds, Answer AI had generated an answer alongside a step-by-step process of […]
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A long-running working group in the Senate has issued its policy recommendation for federal funding for AI: $32 billion yearly, covering everything from infrastructure to grand challenges to national security risk assessments. This “roadmap” is not a bill or detailed policy proposal, but nevertheless it gives a sense of the scale lawmakers and “stakeholders” are […]
© 2024 TechCrunch. All rights reserved. For personal use only.
A few weeks after defeating Elon Musk’s attempt to silence it in court, the Center for Countering Digital Hate (CCDH) — an anti-hate research nonprofit — is back with a new piece of research on X (formerly Twitter). The study builds on earlier work investigating Musk’s impact on online speech by spotlighting how the policy changes he enacted are actively rewarding hate speech posters with increased reach, engagement and even direct payouts through X’s subscriber feature.
The CCDH studied the growth rates of 10 influential accounts that pay for X Premium and have posted anti-Jewish and/or anti-Muslim hate speech since October 7, 2023, when Hamas’ attack on Israel sparked the Israel-Gaza conflict. Some of these accounts had previously posted conspiracy theory content related to COVID-19, per the report.
The 10 accounts tracked for the study (titled “Hate pays: How X accounts are exploiting the Israel-Gaza conflict to grow and profit”) are: Jackson Hinkle, Dr. Anastasia Maria Loupis, Censored Men, Jake Shields, Dr. Eli David, Radio Genoa, Ryan Dawson, Keith Woods, Way of the World, and Sam Parker.
The CCDH found these accounts were able to boost their reach on X after posting hateful content about the war. The report discusses examples of hate speech posted by the accounts, such as tweets depicting antisemitic tropes like the blood libel, or seeking to dehumanize Palestinians by depicting them as rats.
“Each of the accounts showed slow follower growth in the four months before October 7th, for a combined growth of approximately 1 million followers. However, in the four months after the outbreak of the conflict, they collectively gained 4 million new followers,” the CCDH wrote.
Growth rates for individual accounts that gained new followers over the period varied, with the highest growth multiple recorded being 9.6x (for Dawson’s account), followed by 8.3x (for Hinkle), and 7.1x (for Parker). At the lower end, Way of the World grew its followers 1.7x over the period.
X did not immediately respond to a request seeking comment on the report.
The report includes a history of the tracked accounts’ notoriety, noting, for example, that Hinkle is banned by WhatsApp, YouTube and PayPal. Or that the Censored Men (anonymous) account used to generally post defenses of toxic masculinity influencer Andrew Tate, but, since October 7, has focused on the Israel-Gaza conflict. Dawson, a Holocaust denier who also believes the 9/11 terrorist attacks were carried out by Israel, was previously banned from X but had his account reinstated in 2023 under Musk.
Since taking over Twitter, as X was known back in October 2022, the billionaire has reversed a number of legacy account bans, which included notorious white supremacists and neo-Nazis. Coupled with the policy changes Musk has pushed in areas like content moderation, account verification and premium features (such as prioritized ranking for paid accounts’ posts), this has resulted in a polarized platform where it’s increasingly difficult to distinguish genuine information from lies, and where the tone all too often skews toward conversational outrage (or worse).
The CCDH contends this is intentional and is a deliberate strategy by Musk to profit from tragedy. It’s accusing him of embracing hateful accounts and configuring X so that purveyors of hate speech are able and encouraged to turn war and human suffering into an opportunity to raise their profiles on the service and earn revenue from posts that exploit violence and misery.
Six of the 10 accounts the CCDH studied have enabled X’s subscriptions feature, which lets their followers pay them to access additional content. The report also quoted a post by Hinkle in early October, in which he shared a screenshot that showed him receiving $550 in ad revenue over the course of a month — directly profiting from engagement driven by his posts.
The CCDH said its analysis of the accounts showed that even activity that was critical of these posts — such as quote tweets denouncing hateful content — raised their visibility and reach (potentially boosting revenue-generating opportunities). Such critical reshares contributed as much as 28% to the reach of hateful posts, per the report, which suggested the figure is a conservative estimate, as it does not take account of X’s own algorithmic response to these reshares, which applies further amplification aimed at harvesting even more engagement for ad profit.
Ad-funded business models that earn revenue based on user engagement have been known to drive such anti-social outrage mechanisms. In X’s case, Musk’s erratic behavior has alienated some advertisers, but not all: The CCDH found ads being served alongside hateful posts made by all the tracked accounts. “We found ads for Oreos, the NBA, the FBI and even X itself placed near hateful posts,” the report said.
“Under Elon Musk’s ownership, X appears to be pursuing a strategy of hosting as much controversial content as possible,” a CCDH spokesperson told TechCrunch. “We know that this controversial content is addictive, not just for users who approve of it but also for users who criticize it, too. The potential benefit to X is that these controversies could ramp up user time spent on the platform and increase ad revenue — but only if brands are willing to pay for ads that could be displayed near toxic content.”
“The accounts studied by our report have grown sharply despite posting false or hateful content, showing that posting such content is no impediment to growth on X. This is not unique to the Israel-Gaza conflict, but it is the latest example of the problem. Our previous research into accounts that were reinstated following Musk’s takeover of Twitter shows that X stands to make significant ad revenue by welcoming users posting a range of topical hate and disinformation, from brutal misogyny to anti-vaccine conspiracies,” the spokesperson said.
Commenting on the report in a statement, Imran Ahmed, CEO and founder of the CCDH, said: “The public and advertisers need to know more about the symbiotic, profitable relationship between X and hate-peddling ‘influencers.’ Lawmakers must act to enforce greater transparency and accountability from platforms and to allow these companies to be held responsible for harming the civil rights and safety of Jews, Muslims and other minority communities.”
Musk has previously claimed hate speech has decreased on his watch, but earlier CCDH research debunked his claim.
X is also currently under investigation in the European Union for a string of suspected breaches of the bloc’s online governance and content moderation regime, including for its response to illegal content, which may include hate speech. Penalties for confirmed breaches of the EU’s Digital Services Act can reach 6% of a company’s global annual turnover.
A new study that zeros-in on the founders of so-called “unicorns” — companies worth over a billion dollars — has found most have “underdog” founders who are often drawn from the top 10 universities. There’s also a rising female founder make-up, and no obvious monopoly at seed stage of funding for VCs.
The study (“Unicorn Founder DNA Report”) by Defiance Capital of 845 unicorns and 2,018 unicorn founders set out to look at the “DNA” of unicorn founders, concentrating on the U.S. and U.K. (no EU/European) from 2013 to 2023, to define the common traits of these kinds of founders.
The study found:
The study further found that unicorns were dominated by white founders, but that every third unicorn had an Asian founder. Indeed, 38% of unicorns had at least one founder who was not white: 82% had at least one white founder, 62% had first or second generation immigrant founders. Only 3% of unicorns had a black founder.
And only 21% of immigrant and female founders raised from top 10 VCs. Teams with female founders were two years younger than all-male teams when founding their unicorns (32 versus 34).
Serial founders (50%) were more likely to succeed building unicorns, but only one in five unicorns had solo founders.
During the last decade, all top seed funds were generalist funds, and the market for seed funds is highly fragmented. Only 28% had raised capital from a top VC seed fund (with more than 1% market share).
Only 34% of unicorn founders had worked at an elite employer prior to founding a unicorn, suggesting a McKinsey or similar background is not a prerequisite to success.
The study also found three dominant factors in the “DNA” of a unicorn founder.
1. No “plan B”
2. “A chip on the shoulder”
3. Unlimited self belief
The study found that many unicorn founders were forced to develop a growth mindset, with values, work ethic and ambitions all established during childhood.
Most had a personal story of feeling unfairly treated or feeling limited in their native environment.
The study observed these traits in communities left behind for generations, e.g. women founders, people of color, neurodivergent or founders with atypical backgrounds.
Many tend also to be “ambitious rebels,” often motivated by a greater cause they care deeply about, have strong family role models, a quality peer network and no fear of failure.
A far greater number of first and second generation immigrant CEOs had STEM degrees than local CEOs, suggesting a brain drain from emerging or smaller economies to developed ones. Significantly, more second generation immigrants attended an elite university than the rest of the sample.
Other interesting data points came out of the study. Solo founders tended to start their unicorns three years later than founder teams, and it took seven years on average to reach unicorn status for all types of founder teams, but second generation immigrants took only six years.
And in fact, the all-white, male, local, Ivy league archetype of founder was actually an infrequent occurrence, at 11%, and only one-third of founders native to a country where they founded the company graduated from a top 10 university.
In addition, the top 20 U.S. VC funds tended to favor male, immigrant founders with STEM degrees from elite universities at seed, but appear to be missing a trick by largely ignoring female founders, a growing demographic in the unicorn space.
Commenting, Defiance Capital founder Christian Dorffer told me: “I believe this is the most comprehensive study ever done on the backgrounds of unicorn founders in the U.S. and U.K. We cover all new unicorns from 2013-2023, covering over 2,000 founders and over 800 unicorns.”
“VCs famously say that ‘it’s all about the people’, but with only 10% of unicorn founders fitting the Mark Zuckerberg profile, most of the thousands of seed funds are backing the wrong type of founders. One interesting finding in our study is that even the best funds, like Sequoia, only get into less than 3% of unicorns — and only 30 funds have a unicorn market share of 1% or more,” he said.
“The hunger, self-belief, ingenuity and resilience we found in the unicorn founders also make a lot of sense when you see that 62% had immigrant founders (typically from countries where it’s impossible to build unicorns) and 17% of new unicorns last year had female founders.”
He continued: “Immigrants and other underrepresented founders are clearly able to produce these amazing results but I wanted to prove it to LPs. A lot of the immigrant founders are coming from the developing world, like India and Africa, even Eastern Europe. They don’t really have that many options at home. They have to leave and pursue opportunities elsewhere.”
“There’s only 30 funds that have more than 1% share of all these unicorns, which means that it’s totally fragmented,” he added.
“If you combine this fragmentation with the fact that immigrants and women found it harder to fundraise, there’s a huge opportunity for new funds to come in and specifically set out to look for these founders.”
I asked him how a VC or a family office might change their strategy as a result of seeing this research?
“Sequoia being the top fund in only 2.8% of unicorns means that they miss a lot. Yes, for LPs, top funds are a relatively safe investment. But family offices are now looking at emerging managers and especially early-stage funds as the potential Alpha. So if you’re looking to maximize returns as a family office, you need to be in a few new funds, emerging managers in order to get that outlier company that turns into a unicorn,” he said.
Dorffer, who intends now to produce a podcast with many of the unicorn founders surveyed, said: “The stories that are coming out show crazy determination. As a female founder, you have to work twice as hard and take twice as many meetings to raise the money. The founders of Andela and three African founders that built unicorns… have stories that are just so inspirational.”
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