LaunchVic puts 500 Startups on notice as accelerator apologises for sending Dave McClure to launch 500 Melbourne

LaunchVic has raised the possibility of terminating the 500 Melbourne accelerator program if 500 Startups does not make drastic changes to address cultural issues within the organisation.

The assertion comes as more than sixty members of the Australian startup community, including 500 Melbourne lead Rachael Neumann, have put their names to an open letter pledging to call out harassment in the Australian startup scene.

LaunchVic put 500 Startups on notice in response to accusations of inappropriate behaviour leveled at 500 Startups’ co-founder Dave McClure over the weekend, with chief executive Kate Cornick emphasising the organisation’s zero-tolerance policy for sexual harassment.

“This is something we take very seriously, and we will be monitoring [500 Startups] from here on in,” she tells StartupSmart. 

Revelations of concerns about McClure’s behaviour come just two weeks after he traveled to Melbourne to launch the 500 Melbourne accelerator program in partnership with the Victorian Government and LaunchVic.

When asked about the possibility of the two-year 500 Melbourne agreement being wound up if 500 Startups does not show genuine improvements in culture, Cornick told StartupSmart this would definitely be considered.

“It is unacceptable 500 Startups hadn’t reported these issues to us, and that Dave McClure was allowed to travel to Australia to represent 500 Startups,” she said in a statement this afternoon, noting that the situation “highlighted the extent of harassment in the tech and startup world”.

Going forward, Cornick says LaunchVic will be closely monitoring how 500 Startups changes its culture in response to these allegations.

She wants to see the 500 Startups playing a “leadership role in the local community around female entrepreneurship” as well as taking the lead on “addressing harassment issues”.

The accelerator’s co-founder Christine Tsai released a statement expressing regret over the decision to keep McClure as the face of the Melbourne launch, and hopes 500 Startups will be able to fulfill its commitments to the Victorian Government and LaunchVic.

“We regret the decision to have Dave participate in the program launch and the impact it has had on everyone who so publicly supported us up until this point,” Tsai said in a statement.

“During these events, we held Dave up to the community as a hero. And while most heroes are actually human, Dave has made mistakes that are inexcusable and completely against everything that 500 stands for and works towards,” she said.

Rachael Neumann has been appointed as the 500 Melbourne lead, and is a former board member of LaunchVic.

“Rachael is well known to LaunchVic, and has long championed diversity issues in the Australian and global startup community,” Cornick said.

StartupSmart has contacted Rachael Neumann for comment.

Open letter to the Australian startup community

More than sixty high-profile Australian entrepreneurs and startup ecosystem leaders, including Susan Wu, Annie Parker, Atlanta Daniels and Paul Bassat signed an open letter this afternoon, vowing to combat harassment and “predatory behaviour by investors”.

By addressing “bad behavior [from] colleagues and peers” and holding “one another to account”, the letter hopes to encourage a “zero-tolerance policy to gendered harassment” in the startup ecosystem.

“The Australian startup community will, to the very best of our ability take action against the kind of behaviour that makes women feel exploited, secondary or unwelcome. We’ve got a long road ahead of us, and we will be stronger together,” the letter says.  

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