Mar 13, 2022 - Technology

First look: GOP seeks election boost from tech startups

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Illustration: Sarah Grillo/Axios

Republicans are upping their investments in GOP tech startups as operatives try to make the party more technologically self-sufficient, Axios has learned.

Why it matters: Political campaigning is a multibillion-dollar industry, and both parties are pouring money into products tailor-made to winning elections that can ween their campaigns off of legacy technology.

  • The Republicans' sense of urgency is two-fold.
  • They're playing catch-up with Democrats who've invested more in political tech.
  • They're also trying to break their reliance on Silicon Valley companies seen as mission-unaligned at best — and actively hostile to their party and its beliefs at worst.

Driving the news: Startup Caucus, a Republican technology investment fund, just raised $500,000 for its second round of investment in early-stage tech startups.

  • It was founded by Eric Wilson and Joe Pounder. Wilson is a former senior digital operative at the National Republican Senatorial Committee and Sen. Marco Rubio's (R-Fla.) 2016 presidential campaign; Pounder's a veteran Republican strategist and CEO of Bullpen Strategy Group.
  • In a statement, Startup Caucus called its new raise "the most significant targeted investment in the Right’s innovation ecosystem to date."
  • Its portfolio companies are developing products in key political spaces, including fundraising, data, voter turnout, web design, digital marketing and HR and recruitment.

What they're saying: “It’s no secret that Democrats have traditionally held an advantage in political technology innovation, and Startup Caucus is working tirelessly to narrow that gap in a crucial midterm election cycle,” Wilson said in a statement.

  • In an interview, he pointed to progressive outfits such as Higher Ground Labs and New Media Ventures as examples of the left's head start in the space.
  • "They've done a really good job of promoting capitalism to advance socialism," Wilson quipped. "And so we're trying to catch up."

The big picture: Startup Caucus is trying to address what Republican technologists say is an urgent need to craft products designed specifically for GOP campaigns.

  • As corporate America has engaged more on hot-button political issues of late — more often than not in opposition to GOP priorities — the need is more acute than ever, according to Nathan Calvert, the founder of Republican HR suite Revered.
  • "Why are you doing business with folks who are actively working against some of these candidates that you're working for?" is the question Calvert says he poses to GOP campaigns.
  • His pitch: the same services a Fortune 500 software company provides, but with values aligned with its clients. "I think it's only going to get more, 'This is our Republican solution for our Republican campaign,'" Calvert told Axios.

Between the lines: Massive growth in political spending by both parties in recent years also makes for a particularly appealing business opportunity.

  • "Early on, when having investor meetings, I would say, without joking, that this is a recession-proof industry," said Dante Vitagliano, a Republican operative and founder of the fundraising technology company Trailmapper.
  • "Our customers exist by law. They're not going anywhere."
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