As an early executive forcing the explosive growth of PayPal in the early 2000s, David O. Sacks has been instrumental in advancing online payments now ubiquitous across the internet. He then carried that pioneering spirt into founding two companies in Yammer and Geni.com that forever transformed enterprise software and business communications.
Yet despite these storied entrepreneurial feats, Sacks has also established himself as a prescient investor by backing revolutionary startups like Facebook and Airbnb during their earliest days. His current venture firm Craft Ventures expands his knack for identifying world-changing founders.
However, Sacks draws equally impassioned reactions for his controversial political activism focused on issues like free speech, taxation, and the dangers of unchecked "mob rule." Across technology and politics, David O. Sacks has cultivated a reputation as one of Silicon Valley‘s most fascinating multi-faceted figures still reaching new heights at just 50 years old.
Early Life Immersed in Business and Law
Born in 1972 in Cape Town, South Africa, David O. Sacks spent his early years immersed within two realms that would greatly influence his future pursuits in business and political commentary — his family and education.
Sacks‘ father worked as an endocrinologist physician while his mother practiced as a prominent attorney. He credits both parental careers for steering his interests towards the intersection of business development and governance/regulatory oversight from a young age.
Additionally, Sacks remarks that his grandfather‘s success running a candy manufacturing company initially sparked his attraction towards entrepreneurship even before entering school. As he told Fortune magazine:
"I grew up hearing stories about my grandfather, who founded and ran a candy factory that made sweets like Fizzers and Smarties — before he lost the business. That left an impression on me about what it means to found a company.”
In 1977 when Sacks was only 5 years old, mounting political uncertainties motivated his parents to immigrate from South Africa to Memphis, Tennessee in order to raise David and his siblings. Throughout his schooling, Sacks endured experiences with racism and bullying as one of the few Jewish students in Memphis at the time. Hecredits these early hardships for instilling self-reliance and his tendencies to question institutional rules.
Sacks attended Memphis University School for high school where he excelled academically within demanding curriculum. He then pursued higher education at Stanford University in California, earning a bachelor’s degree in economics. From there, Sacks attained a Juris Doctor from the prestigious University of Chicago Law School, although he would opt not to ever officially practice law.
Meteoric Rise with PayPal Mafia
In 1999, while working as a consultant for McKinsey & Company, David Sacks departed that job after just six months. He joined a nascent payments startup called PayPal which at the time had fewer than 20 employees.
However, Sacks identified exceptional potential in PayPal‘s founding team, which included future billionaires Peter Thiel, Elon Musk, and Reid Hoffman. He excelled in roles managing daily operations and business development strategy. Just two years after Sacks joined, PayPal reached profitability processing over $6 million per day in instant payments.
Over the next three years under Sacks‘ direct oversight as Chief Operating Officer, PayPal witnessed borderline unprecedented hypergrowth. When the company went public in February 2002, it had already amassed over 16 million registered users completing transactions across 190 countries. At one point, PayPal even temporarily become larger than mammoth banking institution Merrill Lynch by market capitalization size.
In July 2002, ecommerce giant eBay purchased PayPal for a staggering $1.5 billion. David Sacks earned approximately $40 million personally from PayPal‘s sale. The extraordinary wealth and experience gained working alongside PayPal‘s founders laid the foundation for Sacks‘ upcoming entrepreneurial ventures in the 2000s tech boom.
David Sacks (center) conferring with PayPal co-founder Peter Thiel in early 2000s
In subsequent years, that inner circle of former PayPal executives and investors became collectively renowned across Silicon Valley as the "PayPal Mafia". Members leveraged expertise in online payments into founding or funding the next generation of wildly successful tech companies.
For example, David Sacks‘ close PayPal colleague Reid Hoffman went on to co-found professional social network LinkedIn, which commanded a $26 billion acquisition in 2016. Other prominent companies launched by PayPal Mafia members include Tesla Motors, Affirm, YouTube, Yelp, Palantir Technologies, SpaceX and LinkedIn. Their inspiration originates from witnessing firsthand the rocketship growth Sacks help spur at PayPal at the turn of the millennia.
Pioneering Geneology Research Platform
Shortly after departing PayPal post-acquisition, David Sacks diverted briefly into entertainment sector by launching film production company Room 9 Entertainment. It focused mainly on financing adaptations of novelist properties into major motion pictures. Room 9 found commercial success backing satirical tobacco lobbyist drama Thank You for Smoking, released in 2005 starring Aaron Eckhart.
However by 2006, David Sacks sought to return to applying web technology Innovation towards a more personal lifelong fascination with geneology. He founded pioneering social geneology website Geni.com along with collaborators Adam Buffett and Charles Dunlevy.
The platform allowed users to collaboratively build out interconnected global family trees by inviting known relatives to share uploaded profiles. Venture capital firm Charles River Ventures provided $10 million in initial funding to the novel concept.
Within the first year of launch, Geni members had already created 20 million interconnected ancestral profiles between families. Its accessible social features earned recognition for democratizing family tree research exponentially beyond existing manual search methods.
Over six years, Geni expanded to host over 100 million registered historical profiles. By 2012, recognizing the major strides achieved in a short span, Sacks agreed to sell company to geneology industry firm MyHeritage. The $25 million acquisition paired Geni‘s social graphing strength with MyHeritage‘s billions more historical records.
To this day Geni continues to run and thrive as part of MyHeritage’s broader genealogical ecosystem. It pioneered concepts around applying web and social networking innovations to unlock deeper global family history research.
Revolutionizing Workplace Communications
However David Sacks‘ next entrepreneurial splash wield even more monumental influence on the evolution of enterprise software itself. Yammer‘s creation originated from Sacks‘ past frustrations with inefficient corporate communications while managing hundreds of employees through PayPal‘s astronomical rise.
In 2008 Sacks sought to develop specialty software empowering networked coworkers within large companies to seamlessly collaborate through activity streams and groups. He launched Yammer alongside early Facebook engineering leader Adam Pisoni.
TechCrunch founder Michael Arrington dubbed Yammer “Twitter for the Enterprise” upon its launch for enabling private and secure microcommunications inside complex businesses . The ad-free software followed a freemium model with premium features, pricing tiers scaled to company size, and enterprise administrative controls.
Yammer’s intuitive approach to internal social networking, knowledge sharing, and peer recognition resonated widely. Within two years of launch, the startup secured $25 million in funding from top-tier VC firms like Charles River Ventures and Founders Fund, Peter Thiel‘s investment vehicle.
By 2010, over 200,000 participating organizations with 2 million users had onboarded employees onto Yammer’s activity feed platform. Eventually adoption reached over 90 percent of Fortune 500 companies. Remote workers found immense value in Yammer for aligning within sprawling multinational corporations.
In 2012, Microsoft purchased Yammer for a whopping $1.2 billion in a landmark acquisition that influenced enterprise software strategies industry-wide. The deal marked the second largest ever for a software-as-a-service (SaaS) firm, just behind 2011‘s Salesforce acquisition of Mailchimp. At the time, Microsoft CEO Steve Ballmer directly credited Sacks for his visionary leadership proving the software‘s value:
“The acquisition of Yammer adds best-in-class enterprise social networking to Microsoft’s growing portfolio of complementary cloud services.”
The monumental $1.2 billion purchase price and integrations into Office 365 validated the mainstream business demand for intelligent connected software David Sacks realized nearly a decade earlier.
David Sacks continuing to oversee Yammer after 2012 Microsoft acquisition
Following Microsoft‘s acquisition, Sacks stayed actively involved in Yammer‘s evolution over the next four years. As Corporate Vice President, he guided strategic adoption across over 500,000 organizations using Office 365 before exiting in 2016.
Firsthand in spearheading Geni.com and Yammer‘s meteoric rises, David Sacks pioneered new models for software delivery and digital communications mirrored by innumerable startups since. Both companies found tremendous purpose aiding organization-wide alignment, even through today‘s remote work boom.
Investing in Game-Changing Startups
In addition to his own runaway startup success stories, David Sacks also actively invested capital into the next frontier of paradigm-shifting companies poised to define entire industries:
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Facebook – Sacks famously invested into Mark Zuckerberg’s fledgling social network in 2004, reaping over $100 million retourn from his stake.
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Airbnb – Funded the disruptive hospitality startup‘s initial seed round well before its later $100+ billion valuation peak.
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SpaceX – Joined Elon Musk’s rocket engineering endeavor during its crucial 2008 Series B financing round.
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Uber – Bet early on the revolutionary ridesharing concept early last decade before its future $70 billion IPO.
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Dropbox – Identified promise in the file storage upstart before it surpassed a $10 billion valuation publicly in 2018.
The prescience spotting such revolutionary companies so early has earned David Sacks renown as a startup investor. When weighing whether to back founders chasing unconventional ideas, he evaluates their vision over relying just on traction already demonstrated. As Sacks told Fortune magazine:
“I try to be somewhat emotionally detached from the startup metrics that most investors focus on — things like monthly recurring revenue — and try to make a deeper connection with an entrepreneur who is working on something incredibly ambitious that I think could change the world."
That investment philosophy focusing on boundless human potential over pure financial returns has yielded tremendous impact since.
Craft Ventures Backing the Future
In 2017, David Sacks rounded up $100 million from fellow ultra high net worth technology investors to launch early stage venture capital firm Craft Ventures. The pool grew to over $1 billion assets under management by 2021 through raising subsequent funds.
Craft Ventures focuses investments around boundry-pushing startups innovating within fields like emerging cryptocurrencies & blockchain technologies, artificial intelligence, transportation, biotech, fintech, and SaaS platforms.
So far Craft has invested in over 50 startups across those sectors poised to define the next decade. Example portfolio companies include cryptocurrency exchange platform FTX, AI content tools developer Anthropic, self-driving technology maker Waymo, and synthetic biology startup BitBio.
Craft Ventures partners frequently laud Sacks‘ operational expertise scaling previous startups through monumental growth phases. Current portfolio founder executives lean on Sacks for mentorship on recruiting, marketing, infrastructure planning, regulatory issues, and other pivotal early decisions.
Spearheading his newest venture firm, David Sacks extends his knack for identifying gifted founders and maximizing breakthrough technologies to transform real-world industries.
Controversial Political Commentator
Outside strictly business and technology domains, David Sacks has also developed a notorious reputation for unfiltered political stances. As an independent frequently aligning with conservatives, he vocally criticizes progressive policies like taxation, government regulation, and restrictions on free speech or academic inquiry.
With over 250,000 Twitter followers, Sacks regularly draws chatter and debate by attacking liberal politicians in fiery posts. He argues that extreme reactions to perceived societal problems often cause more harm than good intended.
As one prominent example of Sacks‘ ideology, he sits on the board of the Foundation for Individual Rights and Expression (FIRE) – a non-profit organization defending civil liberties like due process, freedom of expression, and open inquiry on campuses.
Such views trace back to Sacks‘ early adult years studying at Stanford University in the early 1990s. There he co-authored his first book The Diversity Myth in 1995 with close friend and PayPal co-founder Peter Thiel. The polarizing book disparaged affirmative action admission policies and political correctness culture permeating higher education institutions at the time.
Over 20 years later, Sacks expressed regret over some extreme parts of the published college thesis. Yet he maintains similar overarching principles on protecting meritocracy and freedom of speech — even when controversial or unpopular with mainstream audiences.
As another example, in 2019 David Sacks faced allegations of insensitivity towards transgender communities. He tweeted criticism of Democratic presidential candidate Elizabeth Warren for stating her preferred gender pronouns during a debate. While Sacks defended it as principled commentary on compelled speech infringements, he later apologized for the post’s “wrongheaded and hurtful” message.
Through thought-provoking political activity supporting his beliefs, David Sacks has cultivated a reputation as one of few prominent right-leaning technology figures willing to counter left-dominated Silicon Valley conventions. But his outspoken takes also frequent draw intense criticism from liberal advocates as well.
Personal Life
David Sacks resides primarily in Los Angeles today after having lived for years in Silicon Valley. While highly active leading his VC firm Craft Ventures, he remains very private about his family and life outside business.
Sacks maintains a low public profile on personal relationships or activities unrelated to technology or political commentary shared via his social media channels. But he still makes time for civic duties like doing volunteer website design work for Los Angeles emergency COVID-19 response efforts.
He credits his wife Jacqueline Sacks for invaluable support and grounding throughout his heavier public-facing periods directing fast-growth tech companies. Together they have three school-aged children enjoying California life while very much out of any spotlights.
Paving New Frontiers Ahead
Still only 50 years old, David Sacks has already left an incredible impact as one of Silicon Valley‘s most fascinating modern titans. His early leadership forcing exponential adoption of PayPal laid infrastructure for today‘s trillion-dollar online payments landscape.
Sacks then pioneered fundamental cloud communication and genealogy research models through Geni.com and Yammer‘s explosive rises changing how enterprises functionally operate. And his capital allocations have expanded the horizons of revolutionary companies like Facebook, Airbnb, and SpaceX redefining global commerce and technology entirely.
While pushing new boundaries across these business domains, Sacks has also established himself as prominent conservative voice countering liberal tech industry conventions. His commentary spotlighting potential downsides of unchecked "mob rule" mentalities and restrictions on free speech generates substantial debate within the public discourse.
Yet even through present success, David Sacks remains future-focused on shepherding the next iconic generation of companies to prominence through Craft Ventures. Backing tomorrow‘s innovations at intersections of biotech, cryptocurrency, transportation, healthcare and more; he retains ambitions to fund founders engineering breakthroughs beyond what we can presently fathom.
With such hunger continuing to identify opportunities on the frontier edges of progress, Sacks figures to continue courting technology revolutions for decades ahead.