Redeem now - Investor Kenneth Ballenegger was suspended from his firm Oyster Ventures after offensive posts on X.
- Ballenegger wrote on X that Israel should sterilize Gaza's population, among other remarks.
- His cofounder condemned the comments and said Ballenegger would be removed as a partner.
Venture capitalist Kenneth Ballenegger has been suspended from the US investment firm he cofounded, Oyster Ventures, after making offensive remarks on X on the Israel-Hamas conflict.
This story is available exclusively to Business Insider subscribers. Become an Insider and start reading now. Have an account? Log in.According to screenshots shared with Business Insider, Ballenegger wrote on Sunday: "After the war, Israel should handle Gaza like China handles Xinjiang. Full surveillance state. Re education camps. Sterilizations. It's warranted and the only way to pacify the jihadi population."
Responding to criticism from a former colleague, Ballenegger continued: "They reproduce like rabbits and raise them to be terrorists, creating more poverty misery and terrorism. Why should we allow that. The world would be a much better place if they didn't reproduce."
Ballenegger's X account was set to private at the time of writing, though not before his remarks were spotted and condemned by other users. The X posts also remain visible on Google search.
"Absolutely disgusting genocidal rhetoric from someone who apparently works in the VC world," wrote Yashar Ali, a widely followed US political journalist, on X.
Ballenegger's cofounding partner at Oyster Ventures, Sophie Liao, issued an initial statement on X distancing the company from his remarks. Liao did not initially condemn Ballenegger or suggest he would be fired.
"Any employee's personal or political opinion does not reflect the values of Oyster Ventures or myself. Oyster Ventures does not tolerate any behavior that disrespects individuals or groups of people," the statement read.
That statement drew more than 1,000 replies on X, many of which pointed out that Ballenegger was a managing partner and cofounder at Oyster Ventures, and not just an employee.
Liao followed up with a second statement on Monday, confirming Ballenegger had been suspended and would be removed as partner from the firm.
"I want to be unequivocally clear: his statement was appalling," Liao wrote, adding that the posts had caught the team "offguard" and acknowledging her initial statement hadn't gone far enough.
She continued: "On a personal note, as someone who survived and grew up under China's one-child policy, it's awful to see such a callous comparison made between such complex political environments. This perspective makes Kenneth's choice of words even more distressing to me. I've reached out to him directly to explain this and his immediate removal from the firm."
Removing a senior investor from a venture capital firm is, in practice, complex and time-consuming. Managing partners often have financial stakes in the funds they manage and are rewarded a share of a fund's profits. Liao noted that the "process will take time."
Oyster Ventures is headquartered in San Francisco, though Ballenegger's LinkedIn and X profiles indicate he is based in Asia. The company's website is down as of Tuesday, but the firm has backed high-profile unicorn tech companies including ecommerce company Bolt, and online learning platform Masterclass, according to deal trackers Dealroom and Pitchbook.
Prior to cofounding Oyster in 2017, Ballenegger cofounded coin offering firm Republic Crypto and also held positions at AngelList and crypto fintech FreshPay. At Oyster, he has backed firms such as probiotics startup ZBiotics.
The VC is not the only business figure to suffer the consequences of commenting publicly on the Israel-Hamas conflict. Paddy Cosgrave, cofounder of the European tech conference Web Summit, resigned as CEO after posting about "war crimes" on X, which resulted in sponsors and attendees withdrawing from the event.
The blowback over Ballenegger's comments also reflect ongoing tensions in the tech world. Israel is a major player in the global startup ecosystem, and raises billions annually in venture capital, with particular strengths in cybersecurity, defense, and AI. The venture capital world has largely vocally supported Israel. Hundreds of firms signed a statement in support of Israel after Hamas' terrorist attacks on October 7.
For some people in the industry, that vocal support is too uncritical, especially in light of Israel's aggressive military response to the attacks. An anonymous X account, @GenocideVC, is tracking the industry's support of Israel and is followed by hundreds of techies and founders.
BI approached Oyster Ventures and Ballenegger for comment.
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