Vexed in the city: Benioff says it's time to listen to the dissenters (Q&A)

As tech reshapes San Francisco, Salesforce CEO Marc Benioff argues for a broader civic dialogue and says philanthropy offers a way to unite a city riven by increasing social discord.

Charles Cooper Former Executive Editor / News
Charles Cooper was an executive editor at CNET News. He has covered technology and business for more than 25 years, working at CBSNews.com, the Associated Press, Computer & Software News, Computer Shopper, PC Week, and ZDNet.
Charles Cooper
5 min read

Salesforce.com CEO Marc Benioff argues that corporate philanthropy can help bridge the social divide. Getty Images

This story is part of a CNET special report that examines the controversy gripping San Francisco as a massive influx of techies feeds an unprecedented economic boom -- and backlash.

Thanks to a couple of Internet gold rushes and a sizzling stock market, San Francisco now has the highest proportion of extremely wealthy persons of any American city.

More than 7 of every 1,000 people in this city of 824,000 living here has a net worth greater than $30 million, according to a May 2014 report by the SF Human Services Agency. That helps explain why few people bat an eyelash when they hear that Yammer's founder bought a house this summer for $20 million, while Jack Dorsey -- he of Twitter and Square fame -- shelled out nearly $10 million for a two-bedroom apartment. Tech money is fueling a buying binge in San Francisco and its environs as the digital elites spread around what's basically the equivalent of Monopoly Money for them.

Vexed in the city: CNET looks at how San Francisco is dealing with its tech boom. James Martin/CNET

Not everyone is so fortunate. The flip side of the city's relatively small size is that the wealth disparities here are stark and you can see dozens of homeless people crowding together each day literally a stone's throw from City Hall. In fact, San Francisco has more inequality than any other city in California, according to the Brookings Institution.

"We're in a city where you live by that wealth and you die by that wealth," notes Paul Ash, who directs the SF-Marin Food Bank. "It's causing issues but it's also helping us provide services."

Ash was alluding to the higher profile of high-tech givers in the city, folks who are putting some of the millions -- or billions -- made in business back into the community through philanthropic donations. Among the biggest is Salesforce.com's co-founder and chief executive, Marc Benioff.

His company donates 1 percent of its equity, 1 percent of its employees' time, and 1 percent of its products to charity. Meanwhile, Benioff and his wife have donated some $200 million to area hospitals.

For Benioff, this is more than an act of individual charity. He views philanthropy as a way to help heal the widening social divide in San Francisco. Between 2000 and 2012, the percentage of middle class households in the city fell from 40 percent to 34 percent while the number of low-income households climbed from 25 percent to 29 percent, according to the most recent census data. With tens of thousands of affluent knowledge workers from the tech industry moving to the city and displacing longtime residents, Benioff is also sending a message to the newcomers and their CEOs: whether they follow his lead on philanthropy could help shape public perceptions as the tech industry reshapes San Francisco.

Q: Are you concerned about the social rifts that have accompanied the tech industry's growing footprint in the city?
Benioff: This is definitely an issue because this is a dynamic situation. San Francisco has always been a dynamic city. I'm a fourth-generation San Franciscan. I was born on Divisadero Street and I've seen the city change a lot. My grandfather was on the board of supervisors for more than a decade and I remember him telling me stories about the city and the changes that he'd seen. It's always been an entrepreneurial city. Remember the gold rush? That's not so far from what we have now. We're also a city about transformation and change and enhancing culture. This is also the city of the summer of love. This has always been the city of flamboyant characters. That goes back a long, long way.

The changes in the last couple of years have been stark.
Benioff: When we look back, we have to get some perspective on today. When they were creating Wells Fargo Bank or Levi's or Union Square, there was also a shift in where people lived and who was involved. And that's exactly what's going on now.

And that leads to a potential tinderbox situation. What's the role or responsibility of the tech industry?
Benioff: Because it can be so disruptive, it has to be done with a level of compassion and awareness. And that's why I think philanthropy has such a big role. Through philanthropy, we can create models that ease the burden on those who are getting impacted.

But you can't legislate a stop to the laws of postindustrial capitalism. People who don't work in the tech business are going to get impacted.
Benioff: Of course people will be impacted. It's not like this is going to stop, but it can be mitigated by good works. That's why I think Oakland is so important to me because part of my vision -- and my grandfather's vision -- when he created BART, he created the link to Oakland as the first link. Oakland is superaccessible. It's a supervibrant place. It's an incredible community and it's also a community with a lot of challenges. We need to invest in Oakland, which needs to be part of this total picture and can be part of what's going to support organizations and people who are going to get displaced from San Francisco, which is happening.

So in terms of people getting dislocated, those who can't afford to live in San Francisco will move?
Benioff: I think that that will happen, and that's OK. I think that in many ways it will be good for Oakland and that community. We need to boost that economy and boost Oakland. When I was a kid, I used to watch Channel 2 and they would talk about "Oakland-San Francisco," and that's how I view it; Oakland is uniquely connected to San Francisco and we need to invest and build and enhance Oakland. We know that Oakland needs a lot of support.

What do policy makers need to do?
Benioff: I think we need to do a lot more collaboration. I think you only get through this if the people who are providing civil disobedience are a critical part of this equation, as are the politicians, as are the business leaders and the nonprofit sector and the residents. I think if everybody can pull together and collaborate more, I think that we'll be better off.

Clarification Aug. 28 at 8:39 PT: This article was modified to reflect the findings of a report by the SF Human Services Agency that more than 7 of every 1,000 people living in San Francisco had a net worth in excess of $30 million.