The Organized Labor Movement Has a New Ally: Venture Capitalists

Union-organizing startup "Unit of Work" received a $1.4-million pre-seed investment led by the venture capital arm of billionaire Mike Bloomberg, reports the Los Angeles Times. The startup's outside investors "have made fortunes backing technologies such as artificial intelligence, cryptocurrencies and video games. One is among California's foremost critics of public-sector labor unions." But the head of the startup's lead investment firm says that "whenever a community has a want that's going unfilled, there's an opportunity for companies."[T]hese people used to multibillion-dollar sales and IPOs see a big opportunity in the atomized, restive condition of America's workforce and the possibility of transforming it through a new era of unionization. "We only invest in areas where we think we can get a return," said Roy Bahat, head of Bloomberg Beta, the venture arm of billionaire Mike Bloomberg's media empire. Unit's business model works like this: The startup's organizers provide free consulting to groups of workers organizing unions within their own workplaces - helping them build support to win elections, advising them on strategy in contract-bargaining sessions, guiding them through paperwork filings and around legal obstacles. Once a contract is in place, members of the new union can decide to pay Unit a monthly fee - similar to traditional union dues - to keep providing support.... Once the company starts earning income, it plans to buy out its investors and give their equity to the unions it helped organize, effectively transitioning corporate control to the customer base. The approach has attracted some strange bedfellows. The second investment firm in the round, Draper Associates, is led by Tim Draper, a third-generation venture capitalist, bitcoin evangelist and outspoken critic of organized labor... [H]e launched a ballot initiative to ban public-sector unions in California.... "Unit of Work is making unions decentralized," Draper wrote in an email explaining his investment. "That will be awesome. Centralized unions tend to restrain trade, and government unions create bloated bureaucracy and poor government service on the whole.... " Despite Draper's enthusiasm for independent unions, as opposed to nationally affiliated labor organizations, Unit's leaders and its website make clear that they support their clients if they decide to affiliate with a larger union.

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