The Billionaires at Burning Man

Bloomberg Business Week – By Felix Gillette – Feb 05, 2015

Photo: Black Rock City in 2014 Aerial View: Duncan Rawlinson; Plane: Courtesy FlexJet LLC

Move over, Google Bus. There’s a new symbolic fight over tech money, class, and privilege.

For his 50th birthday, Jim Tananbaum, chief executive officer of Foresite Capital, threw himself an extravagant party at Burning Man, the annual sybaritic arts festival and all-hours rave that attracts 60,000-plus to the Black Rock Desert in Nevada over the week before Labor Day. Tananbaum’s bash went so well, he decided to host an even more elaborate one the following year. In 2014 he’d invite up to 120 people to join him at a camp that would make the Burning Man experience feel something like staying at a pop-up W Hotel. To fund his grand venture, he’d charge $16,500 per head.

Tananbaum, a contemporary art collector who resembles the actor Bob Saget, grew up on Manhattan’s Upper East Side and graduated from Yale and Harvard, where he earned both an M.D. and an MBA. After years of starting, selling, and investing in health-care companies, he founded Foresite in 2011. A private venture capital firm with $650 million under management, San Francisco-based Foresite specializes in the health-care and pharmaceutical industries.

Busy building his portfolios, Tananbaum only made it to Burning Man in 2009, the festival’s 24th year, but instantly fell under its spell. While his peers in San Francisco’s high finance circles took up kitesurfing or winemaking, he devoted his spare time to preparations for the next burn. “Jim put a tremendous effort into trying to create something very special for the Burning Man community,” says his friend Matt Nordgren, a former quarterback at the University of Texas, who went on to star in the Bravo reality show Most Eligible Dallas.

For 2014, Tananbaum wanted a camp that was aesthetically novel, ecologically conscious, and exceedingly comfortable. In the spring he and his team sent out a detailed invitation, enticing potential guests with an early vision of the camp, named Caravancicle. Anyone concerned about living in a hot, unforgiving wilderness could rest assured. There would be no roughing it at Caravancicle. Accommodations would consist of a series of cubical tents with carbon fiber skeletons. Each cube would have 9-foot ceilings, comfortable bedding, and air conditioning. The surrounding camp, enclosed by high walls, would be safe and private. Amenities would include a central lounge housed in a geodesic dome, private showers and toilets, solar panels, wireless Internet, and a 24-hour bar. Guests could count on a “full-service” staff, who would among other things help create “handcrafted, artisanal popsicles” to offer passers-by. To help blend in with the Burning Man regulars, who tend to parade around the commons in wild, racy outfits (if anything at all), the camp would include an entire shipping container full of costumes.

Each year as the festival nears, there’s a fresh round of speculation that the event has finally jumped the shark, or become overrun by Silicon Valley tech bros. Tananbaum and Ari Derfel, a Berkeley restaurateur he hired to co-create his 2014 camp, didn’t see it that way. (Neither Tananbaum nor Derfel commented on the record for this article.) The two admired the vaguely utopian, anticommercial culture Burning Man has cultivated over the years.

In Black Rock City, as Burning Man’s annual improvised metropolis is called, there are no advertisements and no wandering vendors selling glow sticks or overpriced beer. (Coffee, from a central cafe, and ice are the only commodities for sale.) The community ethos is loosely governed by “The 10 Principles of Burning Man,” set down in 2004 by co-founder Larry Harvey. These include radical self-reliance (because there’s no water for miles), radical self-expression (get your freak on, people will love you for it), and a “gift economy” (everyone ought to bring something to the party). Over the years, revelers have formed camps—some themed, some just friends and friends of friends in a cul-de-sac, effectively creating microhoods within the sprawl of RVs, tents, domes, and other temporary buildings erected on-site.


With preparations for Caravancicle well under way, the creators of Burning Man were going through their own reorganization. As the event outgrew its origins in San Francisco’s bohemian street theater scene, it had become an LLC, doing upwards of $20 million in annual ticket sales. (In 2015 the majority of individual Burners will pay $390 for a ticket.) Last year, to better manage growth, the six founders of Burning Man transferred their private ownership of the event to the Burning Man Project, a nonprofit, and expanded its governing board. Tananbaum was offered a place on it. He was voted in as the board’s 18th member in April 2014, joining a mix of new members that includes Chip Conley, a celebrity hotelier turned Airbnb executive; Jennifer Raiser, founder of a luxury senior-care company; and Matt Goldberg, a former Dow Jones executive now with QVC. The mission of the new organization is to propagate the Burning Man culture throughout the world, in part by launching a series of smaller, regional festivals. In theory, the beefed-up board will use its far-reaching professional connections to help accelerate the global spread. “It’s not a thoughtless amassing of rich folks,” says Harvey of the expanded board. “But if you want to change the world, you’d better get some people who have real muscular power.”

For Tananbaum, his improbable journey from the precincts of the East Coast Establishment to the inner circle of one of San Francisco’s great countercultural institutions appeared complete. As it turned out, the honeymoon was short-lived.


On Sept. 11, Beth Lillie, a 25-year-old former dog walker in Los Angeles, posted an essay on Facebook, detailing her experience working as an employee—or “a sherpa,” her word—at Caravancicle. It had been more than a week since everybody at Burning Man, including Tananbaum’s guests, had sobered up and returned to their everyday lives, but the experience was still fresh in Lillie’s mind. Her grievances were raw, her portrait damning, and her tell-all account immediately touched off a backlash against Tananbaum that mirrors the San Francisco culture wars of recent years, in which symbols of the area’s surging tech wealth have become lightning rods for anxieties over class and privilege. Overnight, Tananbaum had become the Google Bus of Burning Man.

At the outset of her account, Lillie noted that her goal was not to damage anyone’s reputation (she used made-up names), but rather to provide a behind-the-scenes exposé of the “boring closed off” camps catering to high rollers that were increasingly taking root along a stretch of road that had become known as Burning Man’s “Billionaires’ Row.” According to her post and a subsequent telephone interview, Lillie says she first heard about the job through a friend in Los Angeles. She thought landing a paying gig at Burning Man would help fund her annual pilgrimage to the festival, which she’s attended every summer since she was 18. After meeting with Derfel, Lillie was excited that the camp’s organizers hoped that Caravancicle would help bring about a personal transformation among some of its wealthy, powerful guests. Lillie liked the idea of using Burning Man as a crucible to re-educate the 1 Percent. She signed on to work as a bartender and server. Her pay would be a flat rate of $180 per day.

Lillie says that when she arrived at Burning Man on the eve of the festivities, she found a camp in disarray. Camp Caravancicle had subcontracted much of the construction work to the leaders of a neighboring encampment, and everything was running behind schedule. Tensions between the two tribes were high. The staff had been told ahead of time that Leonardo DiCaprio would be staying at the camp. The expected presence of a Hollywood celebrity heightened the pressure.

Originally, the plan had been for employees to greet guests as they arrived and to acclimate the uninitiated to the unique environment of Burning Man. But with the staff scrambling to put the finishing touches on the accommodations, social engagement largely fell by the wayside. So, too, did the popsicle stand, which was never built. Many of the wealthy guests arrived on private planes, tired and ready to be pampered, only to find a harried, semi-professional staff struggling to meet their expectations.

Instead of a spirit of inclusiveness and harmony, Lillie says she found herself in an environment dedicated foremost to protecting the VIP status of its wealthy inhabitants. Paying guests were outfitted with wristbands like patrons in an exclusive nightclub. Lillie says that while bartending she was given orders to restrict the free cocktails to paying guests. Staff members held a “secret meeting,” Lillie claims, in which employees broke down in tears complaining, among other things, that a few of the male campers were trying to grope them while they worked. The only employees who appeared to be enjoying themselves, Lillie wrote, were the attractive models, a posse dubbed the “mistresses of merriment,” who had traveled from L.A. ostensibly to flirt with and help entertain the male guests. During the telephone interview, Lillie concedes that she never saw any harassment of workers take place. But she says the introduction of paid laborers like her into the libertine atmosphere of Burning Man created an awkward dynamic. “It was like a bunch of old, married men expecting a freaky sex party at Burning Man.?… The girls were all kind of looked at as though we were going to be a part of that.”

Lillie says that rather than re-educating the 1 Percent, the camp was only reinforcing the class divisions of the real world. Roughly three days after arriving, Lillie left Caravancicle and spent the rest of Burning Man crashing with friends. “It was such a disaster,” she says.


Read entire article here

PS UPDATE: From April 2015–Jim Tananbaum, a board member of the non-profit organization that runs Burning Man resigned just two months after he was the subject of a critical article in Bloomberg about the growing influence of extreme wealth at the annual event in the Black Rock Desert….

Posted by Teri Perticone


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