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AngelGate: Chris Sacca Responds To Ron Conway (techcrunch.com)
139 points by davidedicillo on Sept 27, 2010 | hide | past | web | favorite | 72 comments

Mark my words: all of Silicon Valley will regret it if the federal government gets involved in angel financing, "collusion" or no colllusion. It is not easy to build a Silicon Valley, but choking off deal flow with red tape could well destroy it.

When the government enters an area on the basis of negative press coverage, it does not have an informed opinion or a light touch. Think about it: years later, we are still taking off our shoes and surrendering our liquids at the airport. Policies written in haste after a media event are almost never revisited or changed, no matter how much economic damage they do.

I don't want to paint a mental picture by giving too many details, but you can imagine what any government assault on angels would do to the financing environment. This is exactly the kind of premise that a broke California (or federal) government can use to impose new taxes, just like police officers are ordered to increase ticketing when the city needs revenue.

Bottom line: the cure would be far, far, FAR worse than the disease.

For me, minimum capital requirements to be an accredited investor is already far worse than the disease.

I'd prefer to see certification programs that people raising money must apply-for, and have that be the basis of whether an investment is valid for the market, rather than placing a capital requirement on potential investors as the way to determine if an investor is smart enough to reject scams, and thus save the government from complaints and minimize lawsuits than what would happen if joe public and his granny could invest their savings.

Perhaps there could be a certification program too for people wanting to invest.

This I think would free up capital and opportunity, ie real micro finance.

Excellent ideas. Why does a $1mm net worth indicate more 'sophistication' than (for example) having an MBA, or business-law-focused JD, or having passed the Series-7 or bar exams?

Or, there could be a standard waiver-of-claims-of-unsophistication allowing those under the current 'accredited' limits to get the same legal treatment as those meeting the limits.


I think the key with micro-finance is that investors can be diverse, and they can actively seek investments which they can then personally assist, and at the same time entrepreneurs can also try and locate the right investors who'll facilitate the growth of their system.

This is something baby-boomers would love doing, with the time, disposable income, and connections they can offer.

Furthermore, imagine being able to tell a CEO "we'll let you use our api but only if we can have equity in your system." In this case, microfinance supports systems integration.

Another benefit, is that micro-finance would allow entrepreneurs to raise funds more quickly to build more systems, with the goal of having 1 or 2 accepted into some larger system that can pay for its usage.

-- I am thinking a http://www.kiva.org but for entrepreneurs and investors. It'd have to track reputations and act as a hub for financings and subsequent distributions.

> I'd prefer to see certification programs that people raising money must apply-for

I like the gist of your point, but this line scares me a lot. Too much opportunity for political favors or political blackballing.

Certification would more to do with proving an identity, a physical address, a bank account and being connected to real people. It's to make it more difficult for would-be scammers from being able to hide. Thus, a publically accessible website of who's raising money, for what, their photo, and some references who've vouched for this person would (I think and hope) significantly deter scammy behaviour. (of note, this type of information is becoming more accessible anyhow http://blog.programmableweb.com/2010/09/20/watch-out-for-ste... - stealthmodewatch.com)

On the other side of the coin, investors could take a simple multi-choice test on ROI, accounting and finance principles .. whatever.

I'd have to brainstorm further. If an arm has a problem, you don't cut it off, you fix it and make sure it doesn't happen again with creative solutions - because you're not solving any problem by amputating (or rather not applying that solution correctly if there are healthier alternatives), you're just creating more problems.

-- another solution may be to simply cap investments at a certain amount, so people can't invest their life-savings in one go.

-- also, a way to search on these micro investments (and micro investors too) would be great: http://www.google.com/finance/stockscreener http://www.formds.com/filings (hat tip gojomo)

Certifications are generally used to keep people out of a market and allow entrenched players to control things. Look at the state of Louisiana's Florist License for and example of the absurd and protectionist.

I cannot meet those "accredited investor" requirements, which if you think about it, are really meant to cut off dealflow for anyone who isn't already rich.

Meanwhile, I have easily lost an angel investment's sized amount of money in equities and derivatives I've controlled. (and made many times that in positive returns... but it is the losses the government pretends like they are protecting me from.)

I could have been putting $15k-$20k into several startups a year, for the past 15 years, up to one a month in recent years, if the government would let me.

Think about that-- it would have been ILLEGAL for me to invest in these companies (or for them to take my money)... while at the same time I've incurred complete losses of the same size in the public markets, and could blow all of it and more at any casino on the country in a weekend.


If you could put 15-20k a month into startups, how are you not meeting the accreditation reqs?

I think the requirements are to cut off companies from taking investments from little old ladies. It's the startup that would get in trouble, not you.

You considered talking to a lawyer?

I could put that amount in at the end of the period, not the beginning, and accredation requires either a higher salary than i have, or a net worth over a million, which I don't have.

If preventing little old ladies was all that was needed, then it could be accomplished with a wavier.

The other issue that for angel investing is that you really ought to be doing 10+ investments a year to actually even out the risks so that you can get a return. That's a fairly high watermark.

I've done approx 45 investments. One has returned (a small amount) of money in five years, so far.

Not trying to throw Chris under the bus here but if his stated net worth is <$1million when he started, was he not in violation of the definition of "accredited investor" per Wikipedia?

Not if his income was over $200K in the prior 2 years, and expected to be the same in the current year. The income level is an alternate, not additional, qualification.

And, perhaps he fudged some numbers, by inflating the value of something illiquid, to claim to be accredited slightly before he was.

As I understand it -- but could be wrong, IANAL -- this requirement isn't a matter of providing formal documentation to the government beforehand, but of asserting your status to the security issuer, perhaps with some documentation, and them accepting your assertion.

Only if things go south, and disputes/lawsuits begin, would the fact that money was accepted from non-accredited investors begin to cause liability and enforcement troubles for the issuers. So the issuers are motivated to ask for some documentation, but could also easily 'look the other way' or accept flimsy assertions in some instances.

Can anyone comment if documentation is typically required (by the lawyers or startup) from an angel investor or is this assumed (scary)?

That information is incorrect. There is as of today no crebible information proving that the FBI is on the story. Those articles you are referring to are either misquotes or arranged to be more sensionalistic.

Is FBI the agency tasked with investigating allegations of anti-competitive behavior? Interesting.

This is the last thing the valley needed though.

I don't think they have primary responsibility for antitrust law, but the FBI often assists the Department of Justice's Antitrust Division (http://www.justice.gov/atr/) with the fieldwork part of investigations (the FBI is an agency of the DoJ).

I love how government, the most anti-competitive entity there is, will be investigating anti-competitive behavior. Physician, heal thyself.

If I'm understanding your use of the word "anti-competitive" correctly, then any government, simply by virtue of being a government, is "anti-competitive". So what would constitute "healing"? Total anarchy? Welcome to Somalia.

There was a really good comment the other day regarding Somalia, but searchyc isn't finding it.

Basically, there's actually some studies that suggest Somalia is doing _better_ under 'anarchy' than not. It's only after the UN stopped trying to impose a state that things started getting better.

I don't know about HN comments, but there indeed seem to be some studies suggesting that.

http://rru.worldbank.org/Documents/PapersLinks/280-nenova-ha... suggests that the private-sector economy in Somalia did OK during its period of anarchy. (Arguably it's still in anarchy, but less so than before 2006.)

http://www.independent.org/pdf/working_papers/64_somalia.pdf claims that Somalia's economic performance and standard of living "improved during its period of statelessness". Cautionary note: this paper was put out by a libertarian think tank; I don't know enough about their level of integrity to know whether that's worrying.

http://www.peterleeson.com/Better_Off_Stateless.pdf says that the government of Somalia before its period of near-total anarchy was so awful that anarchy was better.

The main takeaway from all this is probably that a sufficiently bad government can be even worse than anarchy. But it also suggests that Somalia was in such a terrible state before its government collapsed completely that any troubles after that have a plausible explanation other than the evils of anarchy.

So, "Welcome to Somalia" was arguably unfair. On the other hand, there don't seem to be a lot of better examples of anarchies available for inspection...

Yeah, really all we have is current Somalia, and the Spanish Civil War... there are others, just not as well known: http://en.wikipedia.org/wiki/List_of_anarchist_communities

I think the real test of whether anarchy is preferable to stable government ('anti-competitive' or not), is whether Somalia is doing better than the United States. A perfectly fair comparison would require Somalia to be under anarchy for the same number of years as the U.S. has been a democracy, but presumably you could pick younger democracies for an easier comparison.

I think you will find that:

1) Anarchies, almost by definition, spill into neighboring countries in the form of violence and/or refugess. This is the reason the U.N. intervenes in the first place.

2) A system of governance imposed by outsiders may be worse than anarchy, but self-governance, given a decade or more, will result in conditions better than anarchy. Indeed, I believe that left alone, an anarchy over time will develop into some form of stable government. Usually it's a dictatorship but there is a small chance it may be some form of self governance.

These are both as yet unproven claims based on my intuition of course. If someone has data to back these up or refute them, that would be really interesting.

I think you're conflating the two definitions of anarchy, though you make good points if you s/anarchy/chaos/g;.

I, too, wish there was better data on this.

You don't have to have anarchy to have competition in government. When people recognize individual sovereignty, its not necessary to fight over who will protect a piece of land and its people from thieves and invaders. Its just a matter of contract.

People can peacefully collaborate on their mutual security without coercing each other.

I hate how you were down voted for pointing out a simple truth. Every industry government gets involved in, it passes laws making competition illegal. We had a thriving and quickly growing mail industry in this country before government took it over (for the purpose of censorship at the time) and made delivering first class mail illegal. They actually do sting operations and fine companies caught forwarding "non time sensitive mail" via fedex!

This is just one example. Obama took over general motors by force, against the will of bond holders and handed out a large chunk to the unions.... And then a few months later a big scare was started against Toyota on spurious grounds. This is not a coincidence.

Recently they made it illegal to sell private health insurance (not fully in effect yet so you can still get it, though prices are rising) and soon only government insurance will be available, though private companies will be allowed to underwrite, presuming of course, that they currier enough favor with government regulators.

The very definition of government-- a monopoly on the use of force over a geographic region- is anti competitive, as it prevents ant other governments from forming in the area... Even if the people in a particular area prefer a different form of government.

This is Pres Obama's experience with health care... what would you be doing to fix health care?

"I remember my mother. She was 52 years old when she died of ovarian cancer, and you know what she was thinking about in the last months of her life? She wasn’t thinking about getting well. She wasn't thinking about coming to terms with her own mortality. She had been diagnosed just as she was transitioning between jobs. And she wasn’t sure whether insurance was going to cover the medical expenses because they might consider this a preexisting condition. I remember just being heartbroken, seeing her struggle through the paperwork and the medical bills and the insurance forms. So, I have seen what it's like when somebody you love is suffering because of a broken health care system. And it's wrong. It's not who we are as a people." http://en.wikipedia.org/wiki/Ann_Dunham

I like the Swiss system. People can actually move their neighborhood to a different canton or create a new one if the one they don't like how things are run in the canton they are in. And it rarely happens, simply because it can.

And the people must approve many measures and certainly those changing the constitution of the country. They have referendums all the time and also proportional representation, which aligns the legislature with the voters.

Of course, this means Switzerland minds it own business and won't invade other countries, but I guess that's the downside of government not driven by anti-competitive urges.

The downvotes are ok. There seems to be an element here that doesn't like it when you state the obvious, but most are rational though.

Is the story getting any coverage outside the SV echo chamber?

I'd be quite surprised if we see the issue cross over into the mainstream.

I read something on msnbc a couple days ago but can't find the link. Here are some from more mainstream sources than TechCrunch, though:




I'd hardly consider Business Insider to be mainstream.

I was going to ask this with it be limited to not just the SV echo chamber but the Techcrunch one as well.

What stood out to me the most, maybe because I'm not in SV, but the claim that ~10 "angels" were involved with 99% of the startups in SV. That just doesn't seem possible in a really healthy startup environment. I mean, there are startups that self boot-strap, there are startups that have a single owner that can fund them, there are startups that have a reputation and pedigree and go straight to institutional funding. There are also companies that stay below radar. How many software companies are we talking about in the greater SV Bay Area? 1200? 1500? And these 10 guys are in nearly all of them? Surely these are only the startups that fill in their crunchbase details or something, right?

Does nobody go outside the valley for funding?

I've a different pov. Govt intervention aka regulation is needed whenever & wherever there is an exploitation. http://en.wikipedia.org/wiki/Microfinance#Other_criticisms

Though these guys have an outsize influence on Web 2.0 apps there are still enough angels out there to minimize the effect of any possibility of collusion among a few angels. If that was what the meeting was about, which I doubt. I think this is a storm in a teacup.The government has enough things to worry about in an economy going south to do anything here.

I think it's far more likely that, already, the only ones with regrets will be the ones involved.

My summary (I did my best to represent the gist of what Sacca was saying):

Chris Sacca considers Ron Conway a mentor and greatly respects him. However, he was "hurt" by Conways email. Sacca was at the first meeting, not the second. He wishes Conway had been there, since they would have liked his input on the things they talked about: standard docs for financing, pro-rata rights ("early investors continuing to stay involved"), futility of VCs blocking company sales, giving more liquidity to founders.

He said they are all pro entrepreneurs, they coach entrepreneurs along the way, and they 'bleed' just as much as founders do. Sacca's first deal was paid with a credit card check, which was stupid but he wanted to help.

Because of Twitter and search, they can't "fuck" entrepreneurs, since it would be forever attached to their names. Sacca is upset at Conways "rush judgement" of his (Conways) friends (Conway allegedly privately referred to them as 'dirtbags' to Sacca).

He wants Conway to ask entrepreneurs how working with the Angels in question is, and hopes Conway realizes how hard they work.

After careful reading of Sacca, Conway, and Arrington, I've come to the conclusion that they might all be correct in their representation.

We know there were at least two meetings of the "Super Angels" - It's possible (likely) that the first meeting that Sacca attend was an aboveboard engagement in which all of the positive conversations that took place were as Sacca described it. Indeed, I read Sacca's email as a shout-out to Conway saying "Hey - the meeting I attended, was above board - don't paint me with the second meeting brush"

It sounds like in the second meeting, the conversation departed from "How do we help entrepreneurs" and started sliding into "How do we increase value for angels". Maybe not full out (actionable) collusion in which any agreements were made (and the concept of agreement is pretty important in collusion) - but skirting dangerously close.

David Lee was at that second meeting (and, for all we know, was one of Arrington's sources - He had Three), likely gave conway the briefing, and conway, being savvy, realized he needed to immediately separate himself, particularly as all this email floating around is discoverable.

Nobody should, for a second, think that Ron Conway is writing email with the belief that it won't be seen in the public light.

Talking as a group about things like holding down valuations, dealing with YC leverage, and the impact of convertible notes on the Angel's cut of deals is all pretty dangerous territory. Sacca wasn't at the second meeting, so his email has to be taken in that context.

All in all I think Arrington has done a great service with some excellent blogging, not only to the startup/entrepreneur scene, but also, ironically, to the Super Angels themselves. By surfacing these conversations early on, I'm of the belief that he may have actually given them a wakeup call before they started doing (illegal?) things like agreeing as a group not to accept convertible notes.

This is hard hitting reporting that harkens back to a day of serious reporting - ironically done not by a "mainstream" news outlet like the WSJ, or NYT - but by a "mere" blogger.


both meetings were aboveboard... period. the discussions at the second dinner meeting were similar in nature to the first, altho Chris wasn't at the 2nd dinner.

we also discussed ways to reduce legal costs, increase exit opportunities by using services like Second Market, how other services like Angel List were innovating & bringing access to more investors / entrepreneurs, how convertible notes were becoming more popular (which i use most of the time, and both PG & Mark Suster have written about lately), and a number of related topics -- again, many of which i mentioned on my blog post in response to Arrington's initial post.

altho some folks were bitching about startup valuations being higher lately, THERE WERE NO conversations about "price-fixing" or other BS mike reported... which is why i got so pissed when mike made such accusations, even though he wasn't there for any conversation & only reported based on anonymous sources.

while some people might suggest Mike's reporting as "hard-hitting", i'd characterize it as more inflammatory and not very well sourced. if he'd bothered to talk in more detail with any of us who were there before rushing to print, he might have gotten a lot more information about the discussions, instead of just printing one anonymous source's perspective... and perhaps less criticism from those who think he's just creating controversy to drive attention prior to the Disrupt conference.

mike has a right to report what he thinks is news, but that doesn't mean it's ok to go to print with only anonymous sources perspectives on that matter, particularly when others (like me) are willing to publicly state otherwise.

in any case, i guess we'll hear more about this in the morning on the panel. i'm tired and i'm going to bed.

believe what you will.

This should have been your blog post

this is much more readable font-wise :)

IMHO, Arrington misinterpreted the core purpose of the meeting and fanned the flames of damaging rumours across the Internet. Poor form if you ask me.

It appears that the first meeting was focused on improving the financing options for startups whilst the second meeting appears to have focused on improving the ROI for investors.

Can someone explain why this is a problem?

If angel investors don't make a good return after risking their own capital, their funds will be diverted elsewhere (as per the rules of a capitalist system) and that is a huge disadvantage to the startup space because valuations will still decrease anyway.

Summary - angelgate is a non-story. Move on people. There's nothing to see here apart from another chance to procrastinate instead of working on your startup (which is highly likely to fail anyway)

Wow. I've dealt with Chris a little (and know people whose companies he has invested in, whose companies have gone both ways) and was always impressed but now am even more so. I obviously knew nothing about his financial situation but can admire anyone who'd put that much on the line when they smelled good gambles.

I don't think I would like it if I knew a e-mail intended to be personal ended up on techcrunch. I don't think the leaking of these personal e-mails is very polite.

Rule number 1: write every email As though it will appear on the front page of the New York Times. If you aren't comfortable with that, then make a phone call or talk in person.

I don't think anyone writing these e-mails expects them not to end up on TechCrunch.

An email sent to 10 public figures in the process of entering a media shit-storm? Personal?

You have a strange definition of the word "personal".

Someone, a person who was at the meeting informed Arrington about the negative purpose of the conversations. So either that person was lying to Arrington and Arrignton to the readers or Sacca is telling half truths. Even as he wasn't at the second meeting anyway.

It's rather obvious that for Sacca his relationship with Conway is more valuable than anything he does for the startups or his freaking charities. The purpose of his long, very long essay is the damage control of the relationship with Conway, nothing else.

Someone, a person who was at the meeting informed Arrington about the negative purpose of the conversations. So either that person was lying to Arrington and Arrignton to the readers or Sacca is telling half truths.

Look at the first reporting on AngelGate. Michael Arrington says he got the content of the meetings from multiple sources:

>This group of investors, which together account for nearly 100% of early stage startup deals in Silicon Valley, have been meeting regularly to compare notes. Early on it was mostly to complain about a variety of things. But the conversation has evolved to the point where these super angels are actually colluding (and I don’t use that word lightly) to solve a number of problems, say multiple sources who are part of the group and were at the dinner. According to these souces, the ongoing agenda includes:

Complaints about Y Combinator’s growing power, and how to counteract competitiveness in Y Combinator deals


Of course, he "claims" that, but it sure reads like a rant from a guy who got snubbed when he wanted to be buddy-buddy with potential sources of information.

I think this is really all about Mike ego not being stroked enough.

And no, I don't think it is outlandish to posit that Mike made the whole set of allegations up.

It's rather obvious that for Sacca his relationship with Conway is more valuable than anything he does for the startups or his freaking charities. The purpose of his long, very long essay is the damage control of the relationship with Conway, nothing else.

Wow, that's cynical. "Freaking charities"?

If you'd ever met Chris Sacca, you'd know that this isn't true. He has just about the strongest reputation of any investor in SV, and doesn't need to lie awake at night worrying about what Ron Conway thinks of him.

Freaking charities? I know we're entrepreneurs here, but I think helping others is about the best thing a person can do.

I don't get it. These mails from Ron Conway and Chris Sacca sounds like founders are babies in their diapers who won't even find the way to the toilet without their angel's "coaching" them. They are taking the "angel" thing too seriously.

And why does these mails have to sound like charity or some great cause? These angles aren't donating to charity - it would be good if it doesn't sound like that. This "how much we do for founders" is overdone. From where I see, the introductions and exposure that comes along with the Angels can help you get, well more introduction and exposure and may be, funding which you already have.

How does a company's success depend on these charitable deeds? It won't result in more paying customers or buyout. I don't like the tone of the mails where it makes it sound like founder are a bunch of ignorant chumps and they owe it to these Angles for the hard work and guidance. First, doesn't matter who the investor is, if founders and team aren't competent, the company would succumb. Second, the work angels are doing aren't for the founders - it's towards ROI.

"Second, the work angels are doing aren't for the founders - it's towards ROI."

Some Angels are focused on that. Others have a different take, from Ron Conway's Email:

"I want to clarify once and for all my total disagreement with your values and motives for being investors.

I have stated consistently for year that I invest because I love helping entrepenuers and watching them learn and succeed."

And, as someone who's been through several startups, and seen those run by seasoned 'serial entrepreneurs' (who've learned the hard way, and could be angels in their own right (and later have done so), and some run by first timers (who haven't even heard of the phrase "term sheet", let alone know how to negotiate one) - I'd suggest that there is a certain class of founder, an entrepreneur out to build a great product for the first time, that while not a 'baby in a diaper', is a 'babe in the woods' - and having someone who is working for _them_, rather than 'ROI' can quite often make all the difference between success and failure.

VCs (at least the three or four I've had exposure to at my low level) are focused on returns. Great angels are focused on helping entrepreneurs succeed. A VC will pursue a strategy that results in complete and utter failure for some of their investments, if it means overall greater returns for their aggregate portfolio of companies. That's just not in the DNA of the few angels I know.

I'd be cautious in trying to understand what the motivator is for these angels - for some of them, their mission is even more important than charity - it's a higher calling in which they are trying to help entrepreneurs succeed, rather than simply chase the almighty dollar. The money is important insofar as it is an indicator of their success, and as a tool to continue their mission - but not necessarily the objective.

Then we must agree to disagree.

For analogies sake, let's talk about Google. Google hires the best geeks, provides free food, doesn't hire PHBs, have a large impact on the world in some ways etc etc. Its hiring best geeks works as a magnet pulling other geeks. Not hiring PHBs means programmers are comfortable working here. Work being done at Google having a large impact gives people a sense of accomplishment and validation. Working with like-minded people lowers the stress level compared to working with idiots who accidentally became programmers and who have no respect for the trade.

In comparison, a bodyshop doesn't do any of it and still does fine financially(I know; I worked for one). Both Google and bodyshop have the same motives with different paths. It's all fine but that doesn't mean Google can claim "We don't want money. We do it for the programmers. See how much we do for them. Checkout the bodyshop which doesn't do anything for the employees and makes a ton of money. Since we do a lot more compared to the bodyshop, it proves we aren't after money and we are working towards higher calling."

Ron Conway is doing just that. Substitute Google with Ron Conway and bodyshop with traditional VCs above.

By claiming he isn't there for money but is just helping people, he is being a hypocrite. Compared to traditional VCs, he might be working more towards the welfare of founders but that doesn't change the fact that it's business and he too is working towards ROI. There is no higher calling; it's just simple, plain business.

I don't recall anyone ever claiming Google was ever "doing it for the programmers" - it's well understood that the perks and environment are there to attract talent and increase their profitability. Also, free gourmet food is increasingly a (relatively inexpensive) standard perk in the valley, so it no longer really sets Google apart as much as it used to.

And note, I never said Ron Conway wasn't there for the money, I just that it wasn't the objective. The objective is to help great entrepreneurs succeed. The money is a (not unexpected) side-effect of succeeding at that objective.

At this stage in the game, and with his network, I'm sure Ron Conway could take much higher ROI approaches if that were really his primary goal. He just isn't wired that way.

Why are people still discussing this? Start-ups don't grow on trees. If there is something to be investigated it will, if there are any problems with angel financing they'll be known, meanwhile all this speculation is a waste of precious time.

BORING. How much longer will this go on? I don't come to HN to read infinite responses to the boring news that investors meet and chat. Who the hell cares?

Apparently, you do since you care enough to reply.

I care enough about hacking to try and keep HN a useful place. Unfortunately it seems most people here are just interested in gossip and giving Techcrunch pageviews.

I don't know Chris Sacca and I've never met Mike Arrington, but reading this email and the original article Mike wrote, Chris has a lot more credibility than Mike to my eyes. OF course, Mike wasn't actually there so his allegations are pretty much by definition unsubstantiated.

I think it is a shame that Mike gets the attention he does, and that his website gets the traffic it does. This is not the first time he has impeached his credibility.

Sounds too good to be true.

Would the downvoters explain this one? Do you think anyone sincerely cares about your best interest the way this guy claims in his email? Because this sounds incredibly charitable.

tl;dr: Ron, Where Is The Love?

I wonder if people will start using public-key encryption or something to encrypt mails so that only certain recipients can read them.

Presumably this wouldn't help because the recipients can always copy out the plaintext of the message to send to TC or whomever. (Unless you're suggesting that TC is intercepting the emails as they travel over the wire, which is quite dubious.)

Do you really think these emails are being intercepted by third parties? Surely the recipients are leaking them and no encryption scheme can prevent that.

True, encryption probably wouldn't help, but you could probably come up with a scheme to watermark the messages. You could make it look like the same thing was sent a large CC list, but be able to determine the source of the leak by a changed word or two. Makes you wonder if some of these smart people are already doing it.

This technique has been used for a while, and it's widely known. It's "easy" to defeat, you need to ask someone else for a copy, and match its contents/changes with the copy from the original leaker.

I don't mean to say it's a bad idea, and it's standard practice in enterprise environments, but it's no silver bullet either.

Plus, to align with parent messages, it won't prevent leaking, it just helps to identify the person.

This email makes the sender look good. The last leaked email made the sender look good. Work out who is leaking them.

No, but their assistants or someone else might be getting to them. Who knows.

the recipients

Or the senders, encryption being equally useless in that case, as well.

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