How the Snowden Leaks Gave Pierre Omidyar a Cause — and an Enemy
The newly radicalized eBay founder hired Glenn Greenwald, Matt Taibbi, and a slew of the country’s most combative journalists — who are already fighting with their financial sponsor.
Every September, for a siren-snarled week, much of midtown Manhattan surrenders to a pair of occupying powers: the United Nations and the Clinton Global Initiative. The U.N.’s annual General Assembly brings in the foreign excellencies and tin-pot dictators, but it’s Bill Clinton’s event that attracts the billionaires. This year’s edition, co-sponsored by, among others, a Greek shipping magnate’s wife and a Ukrainian oligarch, took place inside the barricaded Times Square Sheraton, where the Clintons made evangelical “calls to action” on issues like water scarcity and women’s empowerment.
One evening, in conjunction with CGI, Pierre Omidyar threw a reception across the street. Omidyar, the programmer who created eBay, is one of America’s richest men, a 47-year-old philanthropist intent on giving away the fortune he made when he was 31. He is on collegial terms with the Clintons and has been a partner in their charity work. His guests, sipping wine inside a vaulted glass atrium, represented foundations and banks, governments and NGOs, tech start-ups and McKinsey. Omidyar’s foundation had just unveiled a $200 million Global Innovation Fund, established in partnership with the U.S. Agency for International Development. The announcement was timed to coincide with President Obama’s speech to the conference that afternoon on nurturing civil society.
Omidyar was late to the party, however — he’d spent much of his day hatching plans with some of Obama’s most uncivil opponents. Down in the Flatiron District, he has been building a digital-media organization dedicated to a scorching brand of “fearless, adversarial journalism.” Its prime target is the U.S. intelligence apparatus, and its marquee voice is Glenn Greenwald, the columnist who shared a Pulitzer Prize this year with documentarian Laura Poitras and others for obtaining and publishing Edward Snowden’s leaks about NSA surveillance. Since that story broke, Snowden, Greenwald, and Poitras have become heroes of a crypto-insurgency. More quietly, Omidyar has become the movement’s prime benefactor, financing an operation to disseminate government secrets.
Earlier this year, Greenwald, Poitras, and a third comrade in arms — former Nation writer Jeremy Scahill — launched a website called the Intercept. It is meant to be the prototype for a fleet of publications funded by Omidyar’s flagship company, First Look Media, to which Omidyar has initially committed $250 million. “We have the luxury of doing something different because we have this kind of infinite-resource backer,” Greenwald told me on the phone from Brazil, where he is based. “We’re thinking about how to do journalism structurally differently.” At the time of Omidyar’s visit, a second site, Racket, was also revving up for its launch. Headed by the polemical magazine writer Matt Taibbi, it was going to offer scabrous satire of the financial industry and politics.
Omidyar’s organization operates a little like WikiLeaks, except it is staffed by well-salaried journalists and backed by Silicon Valley money. It aims to unite strident ideology with publishing technology, cryptography, and aggressive legal defense. The Intercept has become the custodian of Snowden’s immense archive of classified documents, which it continues to mine for stories. Greenwald says the site also plans to share them with outside reporters and is building a secure “reading room” in its Fifth Avenue headquarters building, where it is currently renovating three floors. The Intercept is encouraging others in the intelligence world to leak via an encrypted system called SecureDrop. Between its periodic scoops, it serves up regular doses of acidic commentary by critics of Obama’s national-security policies.
Omidyar was an admirer of Obama’s right up to the moment the Snowden story broke, and many people who know him well, the types you might meet at CGI, struggle to explain his sudden turn toward confrontation. “He’s a very serious and public-spirited person,” says General Wesley Clark, who has been friendly with Omidyar since he raised money for his 2004 presidential campaign. Clark has publicly dismissed concerns about NSA surveillance and told me he couldn’t really explain why Omidyar was so agitated. Omidyar is mellow by nature; he lives in Hawaii and is a devotee of Buddhism. “He’s not this hard-core, radical maverick,” Greenwald says. “Back before this all happened, he just seemed like the normal, average, amicable billionaire.” Omidyar has communicated little about his motivations beyond a handful of abstruse public statements. He remains a remote and somewhat mysterious figure, even to his collaborators.
“To this day,” Greenwald says, “I’ve never met Pierre in person.”
There he was, though, inside the throng of the reception: a thin man in a houndstooth blazer, peering intently through rimless glasses. His thick black hair, once worn in a luxuriant ponytail, is now short and streaked by a single gray forelock. Omidyar has an aura of reserve, shuns personal publicity, and seems allergic to the pitching and prostration that his $8 billion net worth inspires in others. He found Jeff Skoll — his partner in eBay, now a philanthropist too — and immersed himself in conversation. Then he broke away to embrace a red-robed Buddhist monk, a fellow acolyte of the Dalai Lama’s.
Dutifully, Omidyar came forward to speak, clinking his glass next to a microphone in an ineffective effort to quiet the conversation. He began to read remarks off a stack of oversize notecards, but he stopped, visibly annoyed by the squealing brakes of a passing truck. “Isn’t New York wonderful? All this ambient sound,” he said. Then he forged onward. “As some of you may know, we’ve been exploring my interest in journalism. We’re really looking for new ways to bring more transparency and accountability to our government and to society as a whole.”
Omidyar’s soft words were nearly drowned out by the cocktail-hour din. But billionaires have many ways to voice their inner displeasure. That morning, Greenwald had published an Intercept column excoriating Obama’s move to bomb ISIS in Syria, suggesting he was intentionally driving recruits to the terrorist army. “At this point, it’s more rational to say they do all of this not despite triggering those outcomes but because of it,” Greenwald wrote. “Continuously creating and strengthening enemies is a feature, not a bug. It is what justifies the ongoing greasing of the profitable and power-vesting machine of Endless War.” Omidyar later tweeted a promotional link.
Omidyar was aware I had made interview requests, but he had remained reticent about his fight for radical transparency. There were rumors of turmoil behind the scenes at First Look — angry conflicts that reflected the inherent contradictions of a leftist offensive funded by a billionaire whose idiosyncratic belief system didn’t fit into neat political categories. When I approached Omidyar after his speech, he handed me his business card, flipping it over to point out one of those square UPC-like symbols, a code that linked to his website. “This is like a tracking chip,” he joked. “It’s like our version of the NSA tracking thing.” Then he courteously turned away.
It is possible to begin to discern Omidyar’s motivations with a little online surveillance. Within his natural habitat, he can be as voluble as he is personally shy. These days, his preferred medium is his Twitter account, @pierre, but the web is strewn with dormant blogs and avatars. His accounts offer granules of self-disclosure in the form of complaints (about the difficulty of ordering vegan room service), enthusiasms (the Segway), and philosophical musings (on “Star Trek ethics”).
As an engineer, Omidyar thinks of the world in terms of structures, and when he sees weaknesses, he becomes alarmed. Before the 2004 election, he blogged that the voting system was “headed towards a disaster,” and he excitedly quoted an anonymous inside source who described flaws in electronic machines that could lead to fraud. He is fascinated by diseases like Ebola and thinks the public-health system could be helpless in a crisis. “Since we know a pandemic is coming,” he wrote in a blog post for a flu initiative, “it’s only a matter of time until we’re sick and we have to take care of ourselves.”
Electronic privacy is another long-standing concern, reflected both in Omidyar’s philanthropic donations — to the Electronic Frontier Foundation, among other organizations — and his personal writings. During the Bush administration, his thoughts frequently returned to concerns about the War on Terror’s effect on civil liberties. He was also early to recognize the way technology was creating a virtual state of full disclosure, enticing people to consensually expose their inner lives to the narcotic curiosity of others.
One evening in February 2004, on his personal blog, Omidyar narrated an account of how he had been drawn into some idle snooping: “So, I’m in a hotel room in Boston, listening to some Moby in my iTunes, and I happen to notice a little blue icon in my list of playlists that I haven’t seen before.”
The icon linked to someone else’s computer, shared through the hotel’s Wi-Fi network. Omidyar clicked and browsed his neighbor’s library, noticing a file called “conjugal visit” that looked suspiciously like a home recording.
“There’s something creepy about this experience. Hotel rooms when you’re by yourself are already a little creepy, since you don’t really know what’s going on behind that wall … Now, I wonder, is he next door? Or above? Or below?
“I check the lock on my door. But I also feel a little bit like a peeping Tom. Is there a word for this phenomenon yet?”
Two days before, not far from Omidyar’s hotel, Mark Zuckerberg had launched Facebook; the creeping uneasiness he described is now a defining characteristic of our times. But the rise of self-revelation has been accompanied by disquiet about the privacy we may be ceding, willingly or not. Omidyar thinks the public is too complacent about intrusion and quotes Google’s Eric Schmidt, who says that government monitoring could “end up breaking the internet.” By this, Omidyar means that a spirit of online community and free exchange was the precondition for the digital age, and eBay’s success, and his unfathomable wealth. He worries that spying could turn trust to paranoia, a threat he takes very personally. “If you think ‘I’ve got nothing to hide’ is good basis for security policy,” Omidyar tweeted last year, “you’ve never been racially profiled or walked into [the] wrong church.”
Omidyar’s parents are Iranian. He was born in Paris, and he is a naturalized citizen: a member of the American community by choice. His parents moved to Washington, D.C., when he was young and soon separated. He was raised by his mother, Elahé Mir-Djalali, a linguist. Much of her published work was done in collaboration with a federally contracted think tank run by a psychologist who developed a word-association technique to help the military understand foreign mentalities. Academically, she was interested in the ways that “the hidden aspects of cultural meanings” make it difficult for speakers from different backgrounds to understand each other, and her studies identified the discontent among students in Iran just prior to the 1979 revolution. When Omidyar was in eighth grade, his mother moved to Honolulu to seek a position at a government-policy institute affiliated with the University of Hawaii. Pierre enrolled in the elite Punahou School, from which Barack Obama had graduated the year before.
Years later, Omidyar would listen to Obama’s rhetoric of “one America” and hear echoes of his own life. “I’ve always loved this country and its ideals with the fervor of a convert,” Omidyar blogged during the 2008 primaries. “He puts words to what I feel.”
Omidyar used to beg his mother to let him spend his Saturdays playing with an Apple II at a Honolulu computer store. He went on to study computer science at Tufts University, where he met his future wife, Pam. They moved out to Silicon Valley in the late ’80s. As a programmer, he “wasn’t a ninja,” says a colleague from that time, but he had the intellectual acuity to comprehend the potential of the internet. He was intuitive and, once convinced of his personal logic, difficult to budge. “I think I had a bad combination of personality traits: lots of self-confidence, and a perfectionist attitude towards my work,” Omidyar wrote in a public online chat years later. “I probably came across as an arrogant know-it-all, though of course that was never my intention.”
Omidyar co-founded a start-up, Ink Development, but when he disagreed with his partners over its direction, he left to take a job with a company called General Magic, an Apple spinoff that was developing a rudimentary form of tablet computing. General Magic was a ’90s hotbed: It called its young employees “magicians” and had an inspirational rabbit that hopped freely around the office. But in Omidyar’s view, both his start-up (which eventually sold to Microsoft, making him a millionaire) and General Magic had a fatal flaw: Their systems were not built to take advantage of the web. “Basically the latest, coolest shiny toy at the time was the web, was interactivity,” Omidyar later recalled.
Originally, the domain eBay.com had nothing to do with auctions — it was a workshop where Omidyar would tinker. Its earliest incarnation hosted a web page about Ebola, inspired by the national scare that coincided with the movie Outbreak. (Later, eBay would offer a variety of origin stories for its odd name, none having to do with Ebola in the Bay Area.) In August 1995, as General Magic began to show signs of financial distress, Omidyar took advantage of the Labor Day weekend to program a simple auction service and posted a link to it on eBay.com. He soon recruited a company president, Skoll, whose first management decision was to remove the alarming Ebola content, over Omidyar’s objection that it was still drawing lots of traffic.
The online-auction idea wasn’t original — a founder of a preexisting site, OnSale, recalls talking to Omidyar about a job before he started his competitor — but eBay was unusually frictionless. The company never touched the inventory, and it left market regulation to buyers and sellers. Instead of policing cheats, Omidyar wrote a manifesto declaring “most people are honest” and set up a forum where users could assign each other positive and negative ratings. “It turned out to be this magic thing,” he later said. By 1997, eBay was hosting 200,000 monthly auctions; the next year, the company went public. “We literally went from Pierre having maybe a couple million, and me just scraping by, to us being billionaires,” Skoll told me.
Omidyar’s insight, then contrarian, is now commonplace: Websites are communities, and people in them care about their reputations. “When everyone else at the time was saying, ‘Wow, what’s great about the internet is that you can be completely anonymous,’ Pierre was saying, ‘No, no, no, I want complete transparency,’” says Steve Westly, an early eBay executive.
While Omidyar built his online marketplace on a foundation of public disclosure, he has closely guarded the dimensions of his own life that he deems unfit for inspection. His crusade against government spying grows out of a conviction that people should be able to protect the secret parts of themselves. When eBay became a dot-com phenomenon, a spokeswoman asked him what she should tell reporters about the company founder. He replied: “That I like my privacy.” After eBay went public, he retreated from the public exposure and administrative hassle that went with running the company, ceding responsibilities to a strong CEO, Meg Whitman. He drifted for a while: first to Paris, then Las Vegas. He built himself a 48,000-square-foot mansion overlooking the desert, which he told Esquire he liked because it gave him “the sense of what the planet was like before humans showed up.”
Eventually, he and Pam decided to relocate back to Hawaii — about as far as you can get from mainland America without being an exile. Omidyar was still fretful about his security and cognizant of the state’s isolation. He had heard that Hawaii had food supplies for only about a week in case of a catastrophe. In 2009, the Honolulu Advertiser reported he kept emergency stockpiles near his home and had purchased a solar-powered ranch in Montana to serve as a “safe house.” But the Omidyars took to the island lifestyle. Pam surfed, and their three kids were brought up relatively free of ostentation. Pierre and Pam donated generously to Hawaiian causes, including sustainable agriculture. He drove a Prius with a LIVE ALOHA bumper sticker.
Though he continued to be eBay’s board chairman and largest shareholder, Omidyar receded from view in Silicon Valley. “Pierre has been such a reclusive guy for the past few years,” says Philip Rosedale, who founded the technology firm Linden Lab, developer of the animated interactive world Second Life. During the mid-2000s, Omidyar immersed himself in the Second Life community, adopting a secret identity: a tattooed black man named Kitto Mandala. Even after Omidyar became a Linden Lab investor, Rosedale primarily interacted with his animated avatar. Mandala rode a Segway and wore a T-shirt that said KISS ME I’M LAWFUL EVIL. He could fly, and hardly anyone knew he was really a billionaire.
In 2003, Omidyar took a trip with some of his real-life peers to NASA’s Space Camp in Alabama. Larry Page and Sergey Brin were there, as was Elon Musk, who had just sold PayPal to eBay. They played astronaut for a week, simulating a space-shuttle launch and weightlessness. They had dinner with Buzz Aldrin and a NASA official, during which the campers pressed to know why America hadn’t sent a man to Mars.
Musk is now building a private company, SpaceX, with the aim of personally landing on Mars. Brin wants to defeat Parkinson’s disease, while Page has invested in promoting longevity, even immortality. Jeff Bezos, Amazon’s founder, has his own rocket company and plans to restore the Washington Post to financial health — no small challenge given the struggles of the news business, in part owing to the disruption of classified advertising by companies like eBay.
Omidyar, by contrast, had trouble settling on a moon-shot project. He didn’t aspire to live forever or touch the stars. He wanted to do unglamorous work at the grass roots, applying the optimistic lesson he drew from eBay: that “people are basically good” and capable of overcoming forces like disease, ignorance, poverty, and repression. But how could this humanistic philosophy bring actual humans together? Through a foundation, Omidyar tried sprinkling angel investments on “social entrepreneurs” and created a patented technology platform meant to allow them to trade ideas the way people bought and sold goods on eBay. (Some users grew frustrated when they learned the conversation wasn’t meant to be a route to Omidyar’s own money, and it ultimately shut down.) Meanwhile, Pam, who previously worked in biotechnology, funded projects like a video game called Re-Mission, designed to help kids fight cancer, and founded an organization called Humanity United, which campaigns against human trafficking and genocide. Pierre realized that information gave rise to action, and that led him to think about newspapers, too.
“He was genuinely interested and concerned about a dissipating news industry,” says Brian Greenspun, publisher of the Las Vegas Sun, who had lengthy discussions with Omidyar almost a decade ago. “And what impact it will have on our democracy.”
Omidyar believed that powerful institutions needed to be kept in check, so he funded organizations like the Sunlight Foundation, a watchdog for money in politics, and the Center for Public Integrity, an investigative-journalism nonprofit. At the same time, his own philanthropic organization, Omidyar Network, conducted itself with unusual secrecy. Founded in 2004, it was at the vanguard of a movement called “venture philanthropy.” It is modeled on a VC firm, making both grants to nonprofits and equity investments in for-profit companies. The organization is partly a private entity, partly a foundation that functions as “just a checkbook,” as Omidyar wrote in the Harvard Business Review. At the cost of millions in tax breaks, this hybrid structure allows the Network to get around many nonprofit regulations. Though Omidyar has been one of the most generous donors to Guidestar, which tracks federal financial disclosures by nonprofits, you won’t find much useful information about Omidyar Network there.
Many in the philanthropy world were aghast when Omidyar began mingling altruism and capitalism, but he dismissed the objections as “old thinking.” He found an area that promised to unite both instincts: microfinance. Omidyar loved the idea that giving out tiny loans in developing countries could unleash entrepreneurialism. He endowed a $100 million fund, administered by Tufts, that invests in microfinance institutions, and donated to numerous nonprofits in the sector. In 2008, Omidyar took a trip to India, where he visited a village near Hyderabad with the founder of a lender called SKS, in which Omidyar Network was an indirect shareholder, via a 22 percent investment in a Cayman Islands–based private-equity fund. He watched as cross-legged women in saris borrowed cash. But when SKS mounted an IPO, the microfinance venture turned into a philanthropic debacle. Unitus, Inc., the Omidyar-supported nonprofit that ran the private-equity vehicle, had a convoluted structure rife with potential boardroom conflicts of interest. (“We have managed to stay out of jail, so we must not be violating any ethics,” one Unitus board member assured a consultant paid by Omidyar.) As it prepared to reap millions from the stock sale, Unitus disbanded its charitable microfinance operations, declaring the concept “validated.” But SKS’s stock later crashed in the midst of political uproar in India over harsh collection tactics, which were tied by opponents to a number of suicides.
Omidyar seems to take such setbacks in stride; he sees traditional philanthropy as overly risk-averse. “In Silicon Valley,” he said at a 2011 nonprofit conference, “we say if you haven’t tried something and failed, and actually learned something from that failure, then why would I want to work with you?” But Omidyar’s habit of investing heavily in big ideas, and sometimes dropping them abruptly, made him appear fickle and inscrutable to many in the philanthropy world. “He got this reputation of being an arrogant know-it-all,” says one nonprofit-sector consultant, echoing Omidyar’s earlier self-assessment. “But they all kissed the ring because they wanted his money.”
When Omidyar moved away from microfinance, he returned his attention to another desperate population: journalists. Fixing the problem of news appealed both to his apocalyptic side — in 2007, he proposed creating a peer-to-peer text-messaging service that would help people to “survive a flu pandemic or other widespread disaster” — and to his belief in the responsibilities of citizenship. In 2008, he started a company called Peer News, working with a small team of programmers in an office in Honolulu. At first it developed a system called Ginx, which was supposed to track the information coursing through Twitter. But it wasn’t able to break into the crowded market, so Peer News pivoted: It would create an ad-free subscription website covering Hawaiian government.
Omidyar conceived of the Honolulu Civil Beat, launched in 2010, as what he called “a new civic square,” and he hoped to reproduce the model around the country. He recruited a staff of six “reporter-hosts” led by a newspaper refugee, John Temple, whose last editing job had terminated with the closure of the Rocky Mountain News. After a difficult start — half the initial reporting staff left within months — the Civil Beat found its niche in weighty investigations. Omidyar was a constant presence in the newsroom. When Pam learned of a remote beach that was despoiled by washed-up plastic, they flew there on his private jet with a reporter. Omidyar took the website’s photos himself.
As a business, however, the Civil Beat never thrived. Omidyar was tight-lipped about audience numbers, even requiring his reporters to sign confidentiality agreements, but the subscription model clearly didn’t work. On Twitter, he pleaded to know how much a reader was willing to pay for his journalism: “No amount, no matter how small? Or a fair price?” Ultimately, he formed a partnership with Arianna Huffington to collaborate on an advertising-supported sister site. While the Civil Beat still covers politics and pension funds, HuffPost Hawaii promotes clickable content like yoga articles and photo galleries of cute seals.
The compromise solution assured the Civil Beat’s survival, but it was far from Omidyar’s original vision. For all his good intentions, he was still searching for that galvanizing cause. Little did he know it had been hidden there all along, in an underground bunker 25 miles outside Honolulu that served as an NSA signals operation center. On June 1, 2013 — three days after the HuffPost Hawaii partnership was announced — a technician who worked at the facility, Edward Snowden, made his rendezvous with reporters at a hotel in Hong Kong.
The radicalization of Pierre Omidyar happened with jarring swiftness. In 2012, he advertised his proximity to Obama — he served on a presidential commission — by tweeting out a photo of Marine One hovering above the White House lawn. That same year, he responded to campaign-season viciousness by tweeting out a list hashtagged #RepublicansIRespect, citing figures like Robert Gates (a former CIA director) and Condoleezza Rice. He started the Democracy Fund, a foundation intended to promote moderation. “I’ve heard him use the term anti-partisan to describe himself,” says Joe Goldman, the fund’s president. “He believes it’s dangerous to get caught up on one side or the other.”
But on June 5, 2013, Omidyar’s Twitter account posted a link to a Greenwald story in the Guardian: “Revealed: NSA collecting phone records of millions of Americans daily.” The issue touched a nerve in him — if ever there were a power that needed watching, it was the NSA. As further stories described the extent of the surveillance and Snowden identified himself, Omidyar vented his outrage. “Mr. President, look in the mirror,” he tweeted on June 23, “when did America become a country to seek asylum from? Whistleblowers are not spies.” On July 4, Omidyar tweeted the text of the Fourth Amendment. At this juncture, there were many ways Omidyar could have gone about influencing policy. He could have sought a meeting at the White House — Pam’s human-rights organization collaborates closely with the national-security staff — or he could have funded a super-PAC. He could have rallied his fellow Silicon Valley billionaires to flex their lobbying might. Instead he decided to build a machine for confrontation and, as he puts it, “to convert mainstream readers into engaged citizens.”
Omidyar kicked the tires on the Washington Post and raised the possibility of working with — or even somehow acquiring — the nonprofit outfit ProPublica. But the Post sold to his old competitor Bezos. ProPublica, like other nonprofits Omidyar talked to, wasn’t for sale. Amid a flurry of furious interaction with privacy activists, Omidyar encountered Trevor Timm of the Freedom of the Press Foundation. While discussing the Snowden leaks via an encrypted video chat, Omidyar mentioned that he was thinking of starting his own media organization. Timm suggested that he contact Greenwald. “I think within a week, I talked to Glenn on the phone,” Timm says. “And he said, ‘Yeah, we’ve already hired ten people.’ ”
Greenwald had a tempestuous relationship with his Guardian editors and had already been planning to launch a website with Poitras and Scahill. “It was really kind of amazing, because we were actually in the process of doing almost exactly the same things,” Greenwald told me. “The obvious difference between what we were doing and what he was doing is that he has $8 billion.”
During last year’s Clinton Global Initiative, Omidyar summoned NYU journalism professor Jay Rosen to his suite at the Hilton to discuss surveillance, whistleblower prosecutions, and the future of journalism. Rosen later became a formal adviser to what would be called First Look Media, espousing what he calls the “personal franchise model” of building a new-media brand: buying up stars with portable readerships. But while acquiring the Greenwald franchise made business sense, it came with complications. Practically, it was dispersed — Omidyar in Honolulu, Greenwald in Rio, Poitras in Berlin — and the journalists were afraid of what might happen if they returned to the U.S. Director of National Intelligence James Clapper labeled them “accomplices” to Snowden’s alleged espionage, and Mike Rogers, the Republican chairman of the House Intelligence Committee, likened them to a “thief selling stolen material.” Now that material was First Look’s chief journalistic asset.
Before any firm plans were in place, much to Omidyar’s chagrin, word leaked to BuzzFeed that Greenwald was leaving the Guardian to pursue what he called a “once-in-a-career dream journalistic opportunity.” The founders’ initial statements were full of revolutionary swagger. “To quote that old CIA torturer,” Scahill told a German interviewer, “we gotta put on the big-boy pants.” He described “a journalist’s paradise,” where reporters would write what they pleased without interference from editors, the government, or Omidyar himself.
To the world, First Look looked like Greenwald’s personal project, but Omidyar never expected to be a passive investor. He engaged in extensive discussions with Arianna Huffington, including a brainstorming session aboard a private jet when they went to India last October for a conference organized by the Dalai Lama. “He wants to do it in a way that can reach a mass audience, not just a niche audience,” Huffington told me. Omidyar thought he would create an omnibus site covering news, sports, and entertainment, generating readers and revenue for a galaxy of star-centered publications. He hired Taibbi, the Rolling Stone writer most famous for likening Goldman Sachs to a “vampire squid,” to start Racket, lampooning the financial industry in the tradition of Spy.
First Look released an animated video in which Omidyar pledged to “bring back to journalism what’s been lost,” as a cartoon reporter sweated over a computer. “How does a company support itself given such ambition?” he narrated. “We’re figuring that out.” In fact, there were still lots of things to figure out, such as who was in charge, whether First Look’s journalism would be expected to make money, and if so, how.
As First Look raced to launch the Intercept, its vehicle for advancing the Snowden disclosures, an Omidyar Network headhunter was dispatched to harvest talent, promising journalists the creative freedom that comes with a $250 million budget. Omidyar probably expected that the potential beneficiaries would be grateful. Instead, there was much gossip and trepidation. Within the ecosystem of journalism and transparency nonprofits, there is hardly an organization that doesn’t take Omidyar’s money, or hope for it, but many are wary of his influence. “If you’re answering to Omidyar,” says the director of one, “then you’re really not independent.” And Greenwald himself, who had declared war on U.S. intelligence and rejects journalistic pieties about objectivity, is a polarizing force. “I think the concept of adversarial journalism is a limited and flawed one,” says Steven Aftergood, the author of Secrecy News, a respected blog that has received past Omidyar Network funding. “It is not an impartial search for truth as much as it is a combative attempt to defeat a perceived adversary.”
To take on the intelligence agencies, First Look has adopted some elements of spycraft. It is seeking out moles, and one of its first hires was a cryptography expert, who fortified its systems against penetration. To protect journalists from government retaliation, Omidyar established the Press Freedom Litigation Fund. But despite his aggressive approach, Omidyar ran into immediate criticism from the conspiratorial extremes of the left. Julian Assange attacked the “big power” of First Look, calling Omidyar an “extreme liberal centrist” and questioning his suspicious visits to the White House. The tech-news site PandoDaily published a series of scathing articles. “Never before has such a vast trove of public secrets,” journalist Mark Ames wrote last November, “been sold wholesale to a single billionaire as the foundation of a for-profit company.”
Earlier this year, Omidyar convened a staff retreat at his Las Vegas mansion, which produced a declaration of editorial independence, promising that First Look would be incorporated as a nonprofit and that he would have “no involvement in the newsroom’s day-to-day operations.” In reality, though, he was deeply involved, demanding personal approval of even trivial expenses, and intent on finding a way to make the venture financially self-sustaining. But his staff was determined to hold him to his promise of “independence.” Many are vociferous personalities, not known for playing well with others. When one prominent editor was approached about a management role, he told Omidyar’s headhunter, “You don’t need an HR department, you need a psychotherapist.”
The confusion inherent to any start-up has been exacerbated by Omidyar’s ruminative style. This spring, he went through a period of deep thinking, highlighted by a summit with news-industry veterans at a hotel he part-owns in Laguna Beach, California. Under “Chatham House Rules,” no one was to talk directly about what was said. “He’s a true believer, I believe,” says Ken Doctor, a media analyst who attended. Many of those who have heard Omidyar and his aides, at that summit and other meetings, have come away thinking his plans sounded naïve and not fully baked. Sandy Rowe, a former editor of the Oregonian who was brought on as a consultant, says the fuzzy vision gives Omidyar flexibility. “This is a man who, since he said he would put down this $250 million, has never said, ‘Here is my plan.’ ”
The absence of a plan, however, contributed to dissension within First Look, and chatter began to emanate from behind its wall of operational secrecy. There was an East Coast–West Coast feud, a divide between the journalists and the technologists. Omidyar’s loyalists out in California and Hawaii grumbled as Greenwald traveled the world, promoting a book, picking up awards, and speaking out of turn. Poitras, meanwhile, was immersed in finishing a documentary on Snowden. There was an internal battle over budgets, which stalled hiring and hindered journalistic output. The Intercept initially published at a piddling rate. In June, the three co-founders of the Intercept and Taibbi wrote a joint letter to Omidyar demanding freedom to proceed with their expansion.
Omidyar then published a blog post saying he had “definitely rethought some of our original ideas and plans.” Instead of quick expansion, he announced that First Look would be in “planning, start-up, and experimental mode for at least the next few years,” focusing its immediate efforts on the Intercept and Racket while working to develop new journalistic technology and design with a team in San Francisco. He also appointed a confidant as First Look’s editorial boss: the former Civil Beat editor John Temple. “I think that the message,” Temple told me in August, “is that we’re not trying hard enough if we’re not failing a little bit, if we’re not saying things that don’t bear fruit.”
The shift proved beneficial to the Intercept, which is no longer under the day-to-day management of its founders. Omidyar lured editor John Cook away from Gawker to run the site, and after a publication pause and a redesign, it has been gaining momentum, breaking big stories about the NSA’s surveillance of American Muslim leaders and the seemingly arbitrary standards of the government’s terrorist-screening system. The latter disclosure reportedly came from a leaker other than Snowden; the FBI recently searched the home of a government contractor suspected of being the source.
The factional conflicts within Omidyar’s enterprise, however, seem far from settled. In August, Temple spoke enthusiastically about Racket, which he said had broadened its focus to include political topics. But as its launch date neared, Taibbi disappeared from the company amid disputes with First Look higher-ups. Omidyar announced Taibbi was leaving and that First Look would now “turn our focus to exploring next steps” for Racket, a project that a spokeswoman said had cost him $2 million over its eight months of development. In the wake of the tumultuous departure, the Intercept published a remarkable inside account describing “months of contentious disputes” between Taibbi and his superiors over his management, including a complaint from an employee that he was “verbally abusive.” But the journalists did not spare Omidyar from blame, describing what they called “a collision between the First Look executives, who by and large come from a highly structured Silicon Valley corporate environment, and the fiercely independent journalists who view corporate cultures and management-speak with disdain.” The iconoclasts even questioned Omidyar’s “avowed strategy” of hiring “anti-authoritarian iconoclasts.”
Even before the turmoil, Temple hinted that a strategic reconsideration was under way. “It will be more complex,” he told me, “than an organization of iconoclasts.” He says that Omidyar sees journalism as “the third phase of his professional life,” bringing together his technology experience and philanthropy, and is prepared to be patient, even if it perplexes outsiders. Temple says there is no incongruity between Omidyar’s communitarian ideals and his financing of an insurgency. “It’s not all about civility,” Temple says. “It’s about having a healthy and open society.” There’s a tangible insight buried in that amorphous sentiment: Omidyar’s interest in journalism is mechanistic. He wants to aggregate to himself the power to declassify and to bring about the “greater good,” as he defines it.
In October, the founding Intercept gang — minus Omidyar — got together for a party at Mayday Space, a loft in a graffitied section of Bushwick. The Snowden saga had entered its Redford-and-Hoffman phase with the premiere of Poitras’s documentary Citizenfour, which was partly financed by Skoll’s Participant Media and looks destined for Oscar consideration. A DJ spun songs next to a huge propaganda-style poster reading WHISTLE-BLOWER! KNOW YOUR PLACE … SHUT YOUR FACE. Smokers congregated on the balcony, which had a distant view of the Empire State Building, lit red. Greenwald hinted of further scoops. “Stay tuned, is all I can say,” he told me.
Greenwald says that he and Omidyar plan to finally meet later this month, when they will appear at a very different sort of gathering: an invite-only event called Newsgeist, co-sponsored by Google and the Knight Foundation. Billed as an “unconference,” it has no agenda other than “reimagining the future of the news.” Greenwald told me “top editors, executives, moguls, and founders” are expected to attend, including Dean Baquet of the New York Times. I asked the organizer from Google about other attendees and speakers, but he said he could disclose no further details, to “protect the privacy and security of our invited guests.” It seems that the Newsgeist is very hush-hush.
*This article appears in the November 3, 2014 issue of New York Magazine.