Trae Stephens, a principal at billionaire Peter Thiel’s venture capital firm Founders Fund, was appointed last week by Donald Trump to help lead the transition effort at the Defense Department.
Thiel, who made a $1,000,000 donation to a pro-Trump Super PAC, is Trump’s highest-profile supporter in Silicon Valley.
At Thiel’s Founder Fund, Stephens “focuses on startups operating in the government space,” according to his official biography. Before that, he worked at another Thiel-backed firm: Palantir, a highly controversial data analysis firm that is currently competing for Defense Department contracts.
“Trae was an early employee at Palantir Technologies, where he led teams focused on growth in intelligence and defense as well as international expansion,” says the biography.
Palantir gained notoriety in 2011 after the hacking collective LulzSec dumped thousands of hacked emails from HBGary Federal, a firm collaborating with Palantir to pitch clients, revealing plans to use Palantir’s data analysis tools on a project to spy on labor unions, journalists, and activist groups on behalf of business interests. The proposal detailed a variety of surveillance techniques, including a PowerPoint presentation calling for the use of malware to steal data from target computers.
Palantir and HBGary Federal denied that the plans were acted upon and said they were merely part of an ongoing discussion, though the hacked emails revealed that the chief executive and board of Palantir signed off on the proposal.
The controversy did not stem the growth of Palantir, which is now reportedly valued at over $20 billion, a valuation that would make Thiel’s stake in the company worth potentially $2 billion.
Last year, another leaked document from Palantir revealed that as of 2013, the firm counted over a dozen federal agencies as clients, including the FBI, NSA, CIA, Special Operations Command, and the Air Force.
Palantir has been engaged in a pitched lobbying battle to win over a $3 billion contract to develop battlefield intelligence systems. In October, Palantir secured a victory in court, allowing them to move forward with the bid. The firm has hired a number of political insiders to influence military contracting decisions, including retired Marine Corps Brig. Gen. Terry Paul.
But no amount of outside lobbying can compare to having a Palantir insider now shaping the entire future of the Defense Department.
Photo: Peter Thiel at the Republican National Convention.