SAN FRANCISCO — At Upload, the parties never seemed to stop.
The start-up began by hosting impromptu gatherings to promote virtual reality as the next big thing. It quickly became an entertainment and news hub for the VR industry, hosting hundreds of events. The crowds were young and eager to network. Models did demos, and the liquor flowed.
The freewheeling atmosphere was not restricted to the evening hours. There was a “rampant sexual behavior and focus” in the Upload office that created “an unbearable environment,” a former employee, Elizabeth Scott, said in a lawsuit filed in May.
Ms. Scott said in her suit that the Upload office had a room with a bed “to encourage sexual intercourse at the workplace.” It was referred to as the kink room. Men who worked for the company were described in the suit as frequently talking about being so sexually aroused by female colleagues that it was impossible to concentrate. When Ms. Scott, Upload’s digital media manager, complained about the hostile atmosphere and other issues in March with her supervisor, she was fired, the suit said.
In a statement after the suit was filed, Upload said that “our employees are our greatest asset” and that “these allegations are entirely without merit.” The company said Upload’s chief executive, Taylor Freeman, and president, Will Mason, could not discuss the lawsuit and its specifics. On Friday, as this article neared publication, the men issued another statement that said, “We let you down and we are sorry.”
At a time when Silicon Valley is filled with tales of harassment and discrimination against women — just this week, the chief executive of the lending start-up Social Finance resigned amid accusations of sexual misbehavior — the purported behavior at Upload stands out. Ms. Scott said in the suit that while she was at a conference in San Jose, Calif., Mr. Freeman kicked her out of her room in Upload’s rented house so he could use it for sex.
If the claims were striking, so was the response.
In contrast to the venture capitalists who were knocked off their perches this summer by harassment complaints, Upload was scarcely dented by the publicity surrounding Ms. Scott’s suit. Mr. Freeman and Mr. Mason were not forced to resign. Investors did not pull their money. The company’s events continued, if in terms that were a bit more muted.
A few weeks ago, the suit was crossed off Upload’s to-do list when it was quietly settled for a modest sum, said two people with knowledge of the case who asked to remain anonymous because they were not authorized to speak publicly.
Both sides had an incentive to come to terms: Upload could say the problem was now in its past, and Ms. Scott, 26, got a victory of sorts without the risk of going to trial.
Shortly after Ms. Scott filed her suit, at least a half-dozen members of Upload’s team quit in solidarity, but they did not go public with their complaints. (At its peak, the company had about 20 to 25 employees.) In interviews, two of those who left described what happened but said that even though they were now working elsewhere, they did not want their names used.
“A lot of people were afraid to be in the media,” said another former employee, Danny Bittman, who broke his silence with a piece in Medium this week in support of Ms. Scott. “We were scared of everything that was happening.”
Behind the scenes, in members-only Facebook groups and other forums, the virtual reality industry is still roiled. People have opinions, they just do not want to be caught uttering them.
“People privately assumed the worst — that the Upload allegations are all true,” said Kent Bye, who does a popular industry podcast, Voices of VR. “Or they assumed the opposite — that the allegations are salacious, crazy and can be ignored. Regardless, they don’t want to risk their career by publicly talking about a connecting node for the entire industry.”
In more than two dozen interviews for this story, even those inclined to see Upload in the most favorable light said it was the story of a company run by young, immature men who were flush with cash and did not know how to handle their power.
That is true of many Silicon Valley start-ups. Some grow out of it. Others, like Uber — which fired 20 employees this year in a harassment scandal that ultimately pushed out much of its top management team — do not until they are forced to.
The situation at Upload was particularly fraught because its principal product was parties. In the great tradition of Silicon Valley start-ups, the company was less interested in making a profit than in getting attention, said former employees. So the line between work and play, often fuzzy, was entirely erased.
The existence of the kink room became the enduring symbol of Upload as soon as Ms. Scott filed her suit. Employees of the porn site Kink.com came to an early Upload party and left behind a sign, said two people with knowledge of the events. It became the name of a room toward the front of the office, a narrow chamber equipped with a bed.
“There was a lack of leadership to cultivate a healthy work environment, and investors who failed to take a more active role in oversight,” Mr. Bye said. “The only way to resolve these sorts of problems is to confront them head on, and that is precisely what no one seemed prepared to do.”
Tech’s Fresh Start
Upload was founded in 2014 as entrepreneurs — many of them women — flocked to virtual reality. There was a feeling of vast potential in the young industry, a sense of being able to make a mark by moving quickly and meeting the right people.
Upload was the place to do it. Two of the founders — a third had dropped out — were in their mid-20s, with energy and ideas but not many credentials. Mr. Freeman, the chief executive, listed “backpacking in Europe” and “freelance user experience designer” on his résumé.
Before becoming Upload’s president, Mr. Mason was an intern at a Florida design studio. A 2014 graduate of Stetson University in Florida, he began an online petition at Change.org in 2015 to remove the school’s first female president, Wendy Libby, labeling her “cancer.” The petition got little support.
“I tend to be fairly passionate about things and wear my heart on my sleeve,” Mr. Mason explained in an email about his petition. “Looking back, there are definitely ways I would handle this differently.”
Although Upload’s ambitions were ill-defined, the company was popular from the start. It quickly raised $1.25 million. One of its most prominent early investors was Joe Kraus, a Silicon Valley veteran who is now at GV, Alphabet’s venture capital arm. Mr. Kraus, who invested $25,000 of his own money in Upload, was described by the company as an adviser. He declined to be interviewed.
Larger sums came from Shanda Group in China and, in a second funding round of $4.5 million, Colopl, a Japanese mobile gaming company. Colopl’s Shintaro Yamakami is the only non-Upload employee on the company’s board. A spokeswoman for Mr. Yamakami said he was currently “refraining from public relations activity.” A spokeswoman for Shanda, an investment firm, said, “We do not have comments to offer.”
Ms. Scott joined Upload in April 2016. She had graduated in 2012 from Emory University, where she was president of a group called the Alliance for Sexual Assault Prevention.
She declined to be interviewed. Her mother, Jenny Scott of Gainesville, Fla., said, “Elizabeth had several incidents growing up that targeted her physical safety and developed her sense of right and wrong.”
Ms. Scott, whose Facebook page describes her as “short, sassy & blonde. Take it or leave it,” managed the stories generated by Upload’s writing team on Facebook, Twitter, LinkedIn, Snapchat, Instagram and YouTube, produced videos and handled relationships with software developers.
She said in the suit that she had other work, too: The women at Upload were required to do what were called “womanly tasks,” including cleaning up. They were also told to act like “mommies” to the men and help them with whatever they needed.
The suit presented a portrait of a deeply entitled male culture, one that clashed with the fresh start VR seemed to offer the tech industry. But Ms. Scott’s suit was the second in the virtual reality industry in just a few months to present such an unwelcoming picture.
Magic Leap, a VR start-up backed by Google and other high-profile investors, had been sued in February by a woman who said in her complaint that she had been hired to make the company more diverse and friendly to women.
The woman, Tannen Campbell, said in court papers that she had challenged Magic Leap “to acknowledge the depths of misogyny” in its culture that “renders it so dysfunctional” it threatened the company. The suit accused the company of gender discrimination and retaliation, which Magic Leap denied. It was settled in May.
Across the tech industry, sexual harassment appears to be ingrained. While the research is largely anecdotal and fragmentary, Chloe Hart, a Ph.D. candidate in sociology at Stanford University, said the subject came up often in 27 in-depth interviews she had with female engineers about their social interactions at work.
Two-thirds of the women, Ms. Hart said, had experienced unwanted sexual interactions, such as being groped or kissed, or hearing comments about the physical attractiveness of women colleagues and sexual jokes or references that made them uncomfortable. One-third talked about men they worked with expressing romantic interest that was not reciprocated.
This and other surveys suggest that in some ways, Silicon Valley has not evolved much over 50 years, even as more and younger women arrived.
Some young women said they did not expect much from Silicon Valley. Amanda Joan, a VR developer, said the “misogynistic and lewd culture” described in Ms. Scott’s suit was as common to Silicon Valley as heavy traffic and expensive housing.
“If I were to boycott every organization that exhibited such culture and behavior (publicly or behind closed doors), I would be severely limited in my options,” Ms. Joan wrote on LinkedIn last month. “Honestly, I wouldn’t hold my breath that there would be any left unless I moved to Wonder Woman’s home island.”
‘A Boisterous Culture’
About 11 months after Ms. Scott joined Upload, Ms. Scott said in her suit, she complained to a supervisor about the office atmosphere, about being shunned by Mr. Freeman and Mr. Mason and about being paid less for equal work and forced to perform menial and demeaning tasks. She was subsequently fired.
That was in March, after Mr. Freeman and Mr. Mason had been named to Forbes’ 30 Under 30 list of rising stars.
All the success on the surface masked a workplace where, one former employee said, “women are seen as the candy in the room.” At Upload events, VR technology was demonstrated by women hired from a company called Models in Tech. Ms. Scott’s suit said the founders tried to secure “submissive Asian women” for a fund-raising trip to Asia.
“Upload was a boisterous culture, a ‘bro’ culture,” said another former employee, Greg Gopman, in an interview. “Virtual reality is hyped and no one was hyping it more than Upload. Within the industry, they were loved for giving people attention in the most positive way. They had a lot of clout and were able to act as they wanted until someone called them out.”
Mr. Gopman, 33, is mentioned in Ms. Scott’s suit. Other male employees, the suit said, would talk about how he “refuses to wear a condom” and “has had sex with over 1,000 people.”
When asked about being mentioned in the suit, Mr. Gopman, who has drawn attention in tech circles before for criticizing homeless people, said he was not happy about it. “How am I going to get married some day if I have to explain that?” he asked. Upload declined to comment on its former employee.
Mr. Freeman, the chief executive, said in an interview that the company was moving on. The lesson he learned, he said, was that employees need to talk more, and that especially in times of trouble they need someone to hear their complaints. Under the agreement to end Ms. Scott’s suit, Mr. Freeman was precluded from discussing it.
“A lot of things could be avoided if there is an open line of communication,” he said. “Once you have five people, male or female, at a start-up you need external HR. Not having someone to go talk to about your potential concerns just makes it so much worse.”
He added, “We’re the strongest as a company that we’ve ever been because of this.”
As for Ms. Scott, she now works for a camera company. She told friends that she had numerous interviews with VR companies, but as soon as they found out she had filed suit against her previous employer, they all declined to hire her.
A woman runs Upload now. Kind of.
Anne Ahola Ward, a specialist in increasing internet traffic, was a consultant to Upload. In June, when many of the employees were quitting, she proposed taking over. Her title is chief operating officer.
“Anne has had a lot of experience, and experience is a huge thing,” Mr. Freeman said. He demurred when asked whether she was the “adult supervision” that all start-ups are said to need. “We’re all adults here,” he said.
Ms. Ward, 38, is wry about the opportunity.
“I’m a woman in Silicon Valley,” she said. “Do you think someone would have handed me the keys to a start-up that wasn’t beleaguered?” Her husband asked the obvious question: Why aren’t you the chief executive? “The title isn’t important to me,” she said.
The kink room is now Ms. Ward’s office. There is no bed there. She has instituted mandatory anti-harassment training: a two-hour session led by an outside consultant. There is now a human resources department. People have formal job descriptions. And as a joke — but not quite — people in the office gave Ms. Ward a sheriff’s badge.
Correction: September 15, 2017
An earlier version of this article incorrectly reported Elizabeth Scott’s age. She is 26, not 27.