How Saudi Arabia shaped Silicon Valley

0:00Hey, Lulu here. Whether we are romping through science, music, politics, technology, or feelings, we seek to leave you seeing the world anew. Radiolab adventures right on the edge of what we think we know, wherever you get podcasts. November 4th, 2017. The phone rings at around four in the morning. A Saudi prince named Al-Walid bin Talal answers. Come right away. A voice commands. Al-Walid bin Talal is a billionaire, a business partner of Bill Gates, a stakeholder in Apple and Twitter, a guy not used to taking orders. But his uncle is the king of Saudi Arabia, and he's told he wants to see him right away.

0:45So he gets in his car and drives to the royal court, where another car pulls up. Prince Al-Walid is told to get in. His driver, his guards, and his assistant are put in a different car. There's no time to grab his phone. And Prince El-Walid finds himself completely alone. It's a long drive up, almost like an official kind of road. Heavy security on the outside and walls around it. Perfectly manicured palm trees line the road. As the sun begins to rise, Prince El-Walid sees an extravagant mansion with towering columns and rows of countless windows in the distance. This is the Ritz-Carlton Riyadh.

1:29It's a huge, fancy hotel, like visiting a French palace or something like that. The car comes to a stop outside the grand entrance of the Ritz, and Prince Al-Walid is ushered into the lobby. The lobby is luxurious, with really beautiful, polished marble floors, and this traditional type of incense called oud. is always burning in the lobby. But something feels different about it. Weirdly empty. He's escorted to the elevator, told he'll be staying in a suite, and left to wait. With nothing else to do, he turns on the TV. Breaking news fills the screen. Dozens of Saudi businessmen and royal family members are being arrested on suspicion of corruption and rounded up somewhere.

2:19Then it begins to dawn on Prince al-Walid that he is one of those people. His captors have removed the locks on the doors, removed the curtains, locked the windows, dismantled the shower doors, so nobody could hurt themselves. Overnight, the writs had been converted into a makeshift prison. By morning, Prince al-Walid is locked in alongside hundreds of other wealthy Saudis. Guards walk the hallways 24-7, manning the exits. Hotel staff are directed to cancel upcoming reservations. And then what happened to these people was they underwent a series of sort of interrogations. To suss out how much of each prisoner's wealth had been gained through corruption.

3:04Either they kind of fell in line and they could go home right away, or they could stay and try to fight. But ultimately, the way you got out of trouble is you just signed over huge amounts of wealth back to the state. The Ritz was closed off to visitors for three months while this was going on. And then one day, as quickly as it had transformed into a prison, it went back to being a five-star hotel. Business as usual. It's one of the craziest events that I've ever heard about in my lifetime. Some called it the shakedown, spelled S-H-E-I-K, a pun on the title for an Arab leader or chief. I mean, there was many, many hundreds of billions of dollars in this hotel of people worth that much money.

3:49And it was no secret who was behind it all. The kingdom's de facto ruler, Crown Prince Mohammed bin Salman, who the world would come to know as MBS. For him, this wasn't just a purge. It was a pivot to a new future. By the time the chandeliers were polished and the curtains pressed, he had reportedly secured upwards of$100 billion for the Saudi state. Money that would help the crown prince transform how the U.S. does business. Bezos is just one of a small army of tech titans falling over themselves to do business with the Saudis and hoover up their cash. Elon Musk's ex-AI gets$3 billion investment from Saudi-backed AI firms.

4:34The biggest YouTuber in the world, Mr. Beast, was in Riyadh this week to launch Beastland. Jared Kushner appears to have cashed in on his time in the White House with a$2 billion investment. Kushner, with the help from Saudi Arabia, took video game giant Electronic Arts Private in the largest leverage buyout ever. A new Trump Tower in Saudi Arabia in a cryptocurrency venture. Saudi Arabia is helping the Ellison family. The Ellisons, who are major Trump supporters. launch a hostile takeover of Warner Brothers in their bid to control U.S. media.

5:13Elon Musk, Donald Trump, Bill Gates, Sam Altman, Larry Ellison, Alex Karp, Jared Kushner, Mr. Beast, Jeffrey Epstein. Those are just a few of the people who have been friendly with and often done business with Saudi Arabia over the last decade. Many of them are Silicon Valley titans, people whose technologies have fundamentally changed how we live. Well before the AI race got going, billions of Saudi dollars were already reshaping the U.S. economy. And now many of those tech companies are vulnerable as Iran targets their infrastructure in Saudi Arabia and other Gulf countries in the ongoing war.

5:57I'm Randa Abdel Fattah. I'm Ramtin Arablui. On this episode of ThruLine from NPR, we follow the money trail, tracing how one of the most authoritarian regimes in the world became one of the biggest investors in American tech, a business partner to the American president, and how that's shaping the future for all of us.

6:25You're listening to ThruLine from NPR. I'm Abdul from Masha, Canada. Part 1. The Startup Prince. Mohammed bin Salman is like your classic millennial. This is journalist Bradley Hope. He's the co-author of the book Blood and Oil, Mohammed bin Salman's ruthless quest for global power. Born in 1985. He grew up with technology. He loves it. Spent a lot of time playing video games. He had an absolute fascination with the great entrepreneurs of Silicon Valley. He created a manga company at one point because he was really interested in Japanese manga. He really had no conception whatsoever of one day becoming the ruler of Saudi Arabia.

7:13So how did this manga-loving tech geek become the guy who would stage the shakedown at the Ritz, The answer is a saga of power and intrigue that could pass for an episode of Game of Thrones or Succession. For most of its history, the region we now call Saudi Arabia was pretty sparsely populated with nomadic tribes. It's the desert, so it's not easy to find food and water. And its main claim to fame was as the home of the holy cities of Mecca and Medina. It's the center of Islam for the world. But in the early 1900s, things began to change. Mohammed bin Salman's grandfather, who is known in the West as Ibn Saud, took over the country through a kind of daring invasion.

8:04There was a lot of jockeying for power happening among the tribes of the region. Ibn Saud wanted to reclaim the glory and ancestral lands of the House of Saud and unify the Arabian Peninsula. He staged a two-prong attack, a military campaign, and a strategic alliance with the ultra-conservative Wahhabists to form the modern nation of Saudi Arabia. Ibn Saud would be its first king. It's an absolute monarchy where all law originates from the decision of the monarch. And then subsequently all further kings were actually his sons. Ibn Saud had over 100 kids with 22 wives. give or take. So we're talking a lot of sons.

8:49And MBS's father, Salman, is one of them. This new nation in the middle of the desert didn't seem to have a lot going for it. But American representatives from the Standard Oil Company of California believed there was oil. Ibn Saud cut a deal. They created what would become known as the Arabian American Oil Company, or Aramco. And the search began. They found oil, but not in commercial quantities. It was not encouraging. They drilled again. No luck. And again, still failure. And then it happened. They did find a huge amount of oil. Over the next few decades, Aramco grew into the most profitable company on the planet.

9:38And the Al Saud family would have a seat at the most important tables in the world, helping to shape the global economy. They lived extravagantly in massive palaces. Oil had given them a ticket to a life of luxury beyond what most of us can even imagine. This was my father's cousins who loaded the oil in these tankers. We know what that oil is worth. This is our land. But we did not see as kids the money that's coming through. This is Ali al-Ahmed. He's a Saudi journalist and dissident. who's been living in the U.S. for the last 30 years. Growing up in Saudi Arabia in the 1960s and 70s, oil shaped everything about his life.

10:23He still remembers the view from the roof of his family's home. I can see the port, the main oil port. He lived in a city on the coast of the Persian Gulf. An ancient city that goes back thousands of years. Ali says all the best resources in his city were funneled 250 miles back to Riyadh, the country's capital, in the center of the country where the royal family lived. Riyadh is drinking fresh water and getting the best electric power. We didn't have any paved roads in the city. But people couldn't make their needs known. In an absolute monarchy, you don't have free speech. News media and TV were severely restricted, and many books were banned.

11:08Ali says the government would conduct raids, searching for contraband. We were so worried about these raids, we had to bury our books, non-political books. One of Ali's favorite banned books was about the Bermuda Triangle. As a child, I remember this big sign on the highway. This is with the government. It says, Dear citizen, do not think. We will think for you.

11:44In 1981, when Ali was 14 years old, he found himself in the crosshairs of the Saudi state while on vacation with his family in neighboring Qatar. They had an alert to track some activists that were coming from Iran, I think. And they arrested us in Dauha, Qatar. So they didn't tell you what the charges were or anything? They just picked you up? No, nothing. You know, you are from a population that they don't like. You must be guilty. It was the middle of Ramadan, the month of fasting for Muslims. July, my God, it was so hot. He and his family members were put on a bus. Like school bus with no AC.

12:23With other detainees. And the thing was packed. We had kids and people just started throwing up. When they finally crossed into Saudi territory and the bus came to a stop outside a prison, They had to drag me from the bus. You resisted. Resisted. So they put chains on my hand and my legs. And I remember reading, made in California, USA. And then we were separated in different cells. Ali was then interrogated. This investigator, he said, what did you do? I said, I'm supposed to ask you that. And there's no right to remain silent or anything like that. No, no, no. No, there is no thing. There is torture and the people were crawling.

13:10Later, I found that one kid, 17 years old, he died in the same area I was. After a few weeks, Ali and his family were released. His dad was able to pull some strings to get them out.

13:33Ali left Saudi Arabia for good in the 1990s, relocating to the United States. Around that time, a young MBS was busy playing video games and surfing the newly minted World Wide Web. No plans for the throne on the horizon. His father was still number three on the list. There was two other older brothers before him. And even if his father somehow ended up as king, MBS wasn't the logical successor. His mom was the third wife, and he had several older half-brothers. It was kind of unimaginable. Plus, the royal family had ballooned. Ibn Saud's many kids had many kids. We're talking thousands. Different branches of the family controlled different parts of the government, and it was easy to get lost in the shuffle.

14:20MBS knew he had to find a way to stand out. So unlike his older half-brothers, who spent a lot of time abroad... They almost sound like posh British people. MBS decided to stay in Saudi Arabia. He went to university in Saudi Arabia. His English wasn't even that great for a long time. He wanted to be close to his father, Salman. He was kind of the family disciplinarian, handling these different families' disputes. So he had files on everybody. All that intel his father had went into a kind of burn book, which MBS had access to, and which he would later use to consolidate power.

15:04And then, in less than a year, MBS's fortunes changed dramatically. Between October 2011 and June 2012, two of MBS's uncles died. The older brothers in line for the throne before his father. With their deaths. His father became essentially the guaranteed second in line to be the king. Suddenly, MBS had a clear path to power. But there were others in the royal family vying for that spot. And MBS knew he had to move fast. It was like almost Shakespearean people conniving against Salman coming into power. MBS put together a team of people he trusted. And they were using everything they could, even what you might consider espionage techniques, to understand what everyone else is doing and what are the different ploys being planned against his father.

15:56MBS just became a round-the-clock tactician. Clearing the path for his father to take the throne and proving himself indispensable. He switched gears from the young kind of business-oriented guy into this kind of king-in-waiting. In early 2015, word began to spread that the sitting king of Saudi Arabia, King Abdullah, was very sick. MBS actually went to King Abdullah with his father in the hospital. And King Abdullah was on a respirator. He was basically dead. Something those closest to him were trying to conceal for as long as possible. And MBS barged into the room. The secretary of the king was there to make sure nobody sees the king on a respirator.

16:45MBS slapped him across the face. That slap led to the announcement of King Abdullah being dead. Late word from overseas tonight of the passing of a major figure in the Middle East. King Abdullah died at the age of 90. King Abdullah's half-brother Salman immediately succeeded him. Salman himself was getting up there in age. So when he took the throne, MBS would be pulling the strings. His cousin told me he is like a bull in a China shop. What he says goes, no matter what anybody else says.

17:24Send in the F-15s. That's the order MBS gave to a room of stunned Saudi generals just eight weeks after his father Salman took the throne. Almost overnight, MBS had consolidated control over the kingdom's finances and military. He installed a close ally as head of Aramco. And he launched a deadly bombing campaign in Yemen.

17:52American-made bombs. The Obama administration sold him.

17:59MBS hoped he could quickly stomp out the Houthi rebels there, who were backed by Saudi Arabia's longtime rival, Iran. He's saying this will be over in a couple of months. Then it becomes a, you know, decades-long problem, and nobody knows that better than America. As bombs were falling in Yemen and civilians dying, MBS turned his attention to his most ambitious project, the thing he saw as the key ingredient to Saudi Arabia's future. Winning over Silicon Valley. The way things get done in the world are through a combination of focus and personal connection. The third factor is self-belief. Ever since he was a video game loving kid, MBS had been obsessed with tech.

18:45And he'd always kept one eye on the U.S. Now, he had the power to disrupt things in that lofty, think-big style of tech CEOs like Sam Altman. He called his plan Vision 2030. It centered around Saudi Arabia's sovereign wealth fund, the Public Investment Fund, or PIF, a rainy-day stockpile worth many billions of dollars. His plan involved converting the PIF into a Silicon Valley super engine. The entire philosophy was they would use this money as an accelerant to something that was already starting to show signs of growth, and they would just pour money onto it in the hopes that it would ignite into a monopoly or something like that.

19:28MBS had gotten the idea from his cousin, Prince Al-Walid bin Talal. They'd actually pitched the idea together, Shark Tank style, when King Abdullah was still alive. This was years before the Ritz kidnapping. Their idea went nowhere. The al-Saouds weren't exactly known for taking risks, which in the 21st century was becoming more and more of a problem. Saudi Arabia was in a bit of a crisis. They were conservative economically. They were conservative politically. In the age of internet and social media. They were conservative socially. Women couldn't drive and had strict dress codes. Movie theaters were outlawed.

20:05And there's just going to be a problem in the future. MBS wanted the country to change, on his terms, which frustrated Prince Al-Walid bin Talal, who had his own vision for how things should go. He's the kind of person that drinks coffee out of a mug with his own face on it. He was the second biggest investor in Twitter, owning more stock than even Jack Dorsey, its then-CEO. And he had shares in Rupert Murdoch's companies, Fox, and News Corp. Even so, MBS cut Prince Al-Walid out of his future plans and started meeting with a Japanese billionaire tech investor named Masayoshi-san. Together in 2016, they started taking Silicon Valley by storm.

20:48Uber has turned to the Middle East for its biggest investment ever. The Uber deal wasn't particularly well-structured or valued. The company announcing a$3.5 billion raise from Saudi Arabia's public investment fund. An unprecedented amount of money for a single investment. It was just saying, we've arrived. This is the new Saudi era.

21:12Coming up, Saudi Arabia goes on a spending spree.

21:24Hi, this is Justin Whitlow from Leicester, North Carolina, and you are listening to ThruLine. Part 2. Friends in High Places Silicon Valley, December 2015 An FBI agent walks into Twitter headquarters with a shocking report. The agency believes there's a spy ring inside the company. Two Saudi citizens and one Lebanese-American were being paid by the Saudi government to spy on Saudis inside the country and abroad. Two of the men were Twitter employees. They'd managed to hack thousands of Twitter accounts. And had helped unmask Saudi Twitter users, as in find their IP addresses, their phone numbers, help discover where they live, personal information, and pass that information along to Saudi authorities.

22:22This is journalist Jacob Silverman, author of the book Gilded Rage, Elon Musk and the Radicalization of Silicon Valley. I've talked to Saudi exiles who live in the U.S. who believe that their family members in Saudi Arabia were unmasked and arrested because of this process.

22:50Five years earlier, in December 2010, Twitter had helped ignite the Arab Spring. The story of a Tunisian fruit vendor named Mohamed Bouazizi went viral after lighting himself on fire in protest. And across the Middle East, people were coordinating, protesting, resisting, using Twitter to amplify their voices. Many young Saudis logged into those conversations. For a while, Saudi Arabia was one of the biggest markets and certainly the biggest market in the Middle East for Twitter. It was a digital public square where free thought was allowed, even if their physical reality remained unchanged. At the time, a lot of these tech companies saw their technologies, and especially social media, as inherently liberatory, as these were emancipatory technologies.

23:38The Arab Spring, of course, did not take off in Saudi Arabia because it's a very repressive country. By 2015, Saudi Prince Al-Walid bin Talal was a major investor in Twitter. In 2018, the Arabic-language Twitter account of Saudi journalist and dissident Ali al-Ahmad was suspended. He'd also been a target of the spy ring. The Saudi government has one of the largest media empire in the world. They have a policy of expanding their media empire to control public opinion. Now they were paying the price. People are spending years in prison, decades in prison because of this action. One of the men who was allegedly unmasked by the spy ring was recently executed.

24:29The full extent of the damage isn't quite known, and that may be happening much more widely than just Twitter. The two Saudi spies managed to flee the U.S. without consequences and are believed to be living in Saudi Arabia. The Lebanese-American spy stood trial in a U.S. federal court and was sentenced to three and a half years in prison. That indictment is how we learned a lot of these details. But one name omitted from the record was the head of the spying back in Saudi Arabia. They took away his name, but, you know, somebody leaked it, and it was pretty obvious. Badr al-Asakir, a close advisor of Saudi Crown Prince Mohammed bin Salman, known widely as MBS, who runs his private foundation.

25:16I think one mistake that the tech industry made, that Silicon Valley made, was that it went into all these foreign markets without really thinking about how can this stuff be used in more malevolent ways for surveillance, for oppression, for monitoring those same dissidents and activists. In June 2016, six months after the FBI showed up at Twitter headquarters, Jack Dorsey and MBS met in the U.S. They took photos together, smiling and shaking hands. The photos were posted to Twitter by none other than Badr al-Asakir, the alleged head of the spiring. To my knowledge, Jack Dorsey never commented on any of this.

25:57This was all happening right around the time that massive, unprecedented Uber deal went through. And a lot of CEOs in Silicon Valley were starting to wonder if the Saudis were the key to their futures too. MBS might be a dictator, but he had a lot of money and was clearly willing to invest. There's these two worlds of MBS. There's the secret, paranoid, hidden world where he's trying to defend himself against perceived threats. And then at the same time, there's this sort of public version, which is the transformative, charming, changemaker prince, who is going to change Saudi Arabia forever. Because alongside his authoritarian moves, MBS was starting to liberalize Saudi Arabia in ways that appealed to Westerners.

26:41Reopening movie theaters, allowing mixed-gender gatherings, giving women the right to drive, and sidelining the religious police who had strictly controlled what women wore. The question was, could that paranoid hidden world and his public image as a changemaker coexist forever? Over the following year, each season brought that question closer and closer to a tipping point. Spring 2017. Tomorrow, as you know, I'm going to Saudi Arabia. Just a few months into his first term, President Trump surprised everyone when he announced his first overseas trip as president. Usually, in the traditions of the White House, you first visit your closest allies.