The Alamo Square neighborhood of San Francisco has long been considered one of the city’s most beautiful. The few blocks that make up the modest district sit snugly near the center of the city, framed by the past and with views of the future. The square is lined with bright “painted lady” Victorian homes built in the late 1800s, thanks in part to money from the Gold Rush years earlier. To the east, across gritty Market Street, modern glass skyscrapers are erected almost daily to house the fortunes being minted by the new gold rush—a wave of handsomely funded private companies, many of them valued at more than $1 billion, so-called unicorns. After the bubble had popped years earlier, there had been a resurrection of start-ups returning to the city, and billions of dollars ready to fund them.
On a bright and chilly afternoon in the summer of 2012, in the park in the middle of Alamo Square, a group of children giggled as they bounced through the playground, and unleashed dogs barked as they chased one another on the hilltop. And there, amid this happiness, Ross Ulbricht lay on the grass, inhaling his new city.
Ross fell in love with the Bay Area from almost the moment his feet touched the ground in San Francisco. Everything looked so magical and new. The flat, prairielike avenues of Texas were replaced by streets that seemed to undulate like a never-ending roller coaster. The billboards along the freeway didn’t talk about NASCAR, Jesus, or the best rib-eye steak in town but rather advertised mystical search engines, social networks, and even new digital currencies.
He had arrived in this wonderful universe a few weeks earlier, wide-eyed and full of vigor. All he owned now was a small bag of clothes and his laptop. He felt as free as he ever had: the homeless kingpin of one of the fastest-growing drug empires in the world.
The decision about where to stay was simple. His pal from Austin, René Pinnell, who now lived in San Francisco, and his girlfriend, Selena, offered up a spare room in their small but welcoming apartment. Soon after Ross unpacked his few belongings, the three friends settled into a new routine, spending evenings exploring the city, cooking dinner, and talking about the meaning of life. (There was, however, one thing Ross didn’t talk about: the Silk Road. He was never going to make that mistake again.) They played card games together, Twister, Scrabble (Ross often won), and hugged each other good night.
After breakfast each morning, while René and Selena sauntered off to work, their new roommate, Ross, would wave good-bye and wander down the street to a nearby coffee shop to oversee his drug empire.
The safest place he had found to work was a small café on Laguna Street called Momi Toby’s, which was conveniently located a block from René’s apartment on Hickory Street. Momi Toby’s (pronounced “mow-mee toe-bees”) resembled a French bistro with small tables and chairs outside. Inside, the Wi-Fi was free, and lots of seating allowed Ross to have his back against the wall so no one could see his computer screen, and subsequently the Silk Road.
As the weeks went on, Ross made new friends in the city, which carried some stress. While he couldn’t talk to them about what he did for work, he could discuss what inspired him to do it. After all, in San Francisco the mentality of using technology to try to disrupt a broken system wasn’t a strange way of thinking but rather the norm. In so many ways, the programmers and entrepreneurs Ross met were just like him.
They looked at the world around them and saw that the government was a ball of wasteful red tape; that the taxi industry treated customers like shit; hotels overcharged and overtaxed; health care was a sham, driven by the needs of the insurance agencies, not the sick; oil-dependent cars had helped to justify an eternal war in the Middle East; and illegal drugs were only illegal because the government wanted to control the people. And all of these issues were a result of the previous generations’ mistakes. Their parents had inextricably fucked up the world we lived in, and it was the people in San Francisco—those just like Ross—who were going to use technology to fix it all.
You’re fucking welcome!
He was also invigorated by the manifestation of the libertarian ideals around him that the start-ups were employing. And here was Ross, doing the exact same thing, but instead of taxis or hotels, health care or gas-guzzling cars, he was trying to defeat the U.S. government and its pathetic, destructive war on drugs.
The CEOs of these other start-ups were no different from Ross, either. They had all read the same Ayn Rand books. These chief executives shared the same quotes on Facebook as he did: “The question isn’t who is going to let me; it’s who is going to stop me.” The leaders of these companies all preached the same verbiage as the Dread Pirate Roberts too, on their blogs and in their press releases: “Let the market decide; not the government.” “Let the people determine who should win; not the politicians.” “We’re changing the world and making it a better place.”
Most of all, the new friendships he was making were the perfect antidote to the problems he was now experiencing on the Silk Road. Sadly, his closest confidant was starting to rub him the wrong way. Not only was Variety Jones not okay with selling H, which went against Ross’s entire libertarian philosophy behind the Silk Road, but VJ also proclaimed that sure, while he was there to help Dread free people from the clutches of government, they were still, at the end of the day, drug dealers.
Ross vehemently disagreed. “As long as we don’t cross [a] line in our pursuit,” DPR wrote to Variety Jones, “then we are only doing good.”
“Ha, dude, we’re criminal drug dealers,” VJ responded. “What line shouldn’t we cross?”
“Murder, theft, cheating, lying; hurting people,” DPR replied, resentful of the question. “That line. We are drawing a new line I guess you could say. According to that line, we aren’t criminals.”
This discussion echoed another suggestion from VJ, that Ross should put a powerful lawyer on the payroll. “You need to pick a top man, a top man in his field, with top man contacts,” Jones wrote. “That field is interstate drug smuggling, money laundering, RICO and drug kingpin legislation.” But in Ross’s mind, he wasn’t going to get caught, so why would he need a “top man” lawyer? That was already admitting defeat.
And then there was the biggest new development between the two friends and associates: it seemed that VJ wanted more ownership too. Maybe this was why he had been so nice all along? Maybe when he had come up with the brilliant plan to rename the creator of the site the Dread Pirate Roberts, it was Variety Jones’s hope that one day he would become the next pirate to captain the ship.
Their recent debates had come to a head when VJ wrote, “I think we need to formalize . . .” To create an official partnership between the two men . . . “If only to avoid confrontation in the future.”
Ross was caught off guard by the question, and another debate ensued.
“Here’s the thing,” VJ wrote. “I do well two ways.” Option one: “50/50.” Option two: “Me having it all.”
What the heck was Variety Jones talking about?! Ross wasn’t giving up control of his site. Here was the only person Ross could trust in this online world, who had given him endless advice, and was now giving ultimatums.
“Well, you can’t have it all now can you?” DPR wrote. “You could compete with me and maybe you’d win, but . . .”
VJ could tell the conversation was getting contentious quickly, so he quelled the argument. “Naw, let’s not go down that road. I’m not gonna do that, ever, I promise. But, I do know what I bring to the table, and it’s a shitload.”
“I know you do.”
“Dude, I want equality,” Jones wrote. “I don’t do second fiddle very well.”
But Ross had no interest in parity. In the current version of the site, it was Ross’s world, and he got to decide what went and what didn’t. He dictated who got a raise and who didn’t. People who worked hard were rewarded, as he had recently done with some focused employees, giving some of them an extra few hundred dollars in Bitcoin when they excelled. When Ross wanted to reward Smedley, the chief programmer, he did it on his terms. “You’ve really stepped up to the plate here already. Your base pay is still $900 of course, but I’ll throw [in] a bonus.” And when Inigo, another lieutenant, needed help finishing a renovation project on his house, Dread gave him an extra $500 to pass along to his handyman. Those kinds of decisions were up to Ross the Boss to decide, not VJ.
What would have happened if he had to run these things past his lieutenant? No, thank you. Plus, how would Ross exert power and control on the site? He was already having a difficult time getting people to show up to work on time, or fill out the correct reports that he wanted to see at the end of their shift. He even enjoyed disciplining employees, telling them (still in Ross’s hokey banter) that they had “fudged up” when they needed a good scolding.
Ross had worked too hard to simply hand anything to anyone. And shortly after this conversation with VJ, Ross simply stopped talking to him for a few days. Instead he retreated into the real world. Into San Francisco.
As Ross stood up from the grassy knoll at Alamo Square and reached for his brown laptop bag to head back to his apartment, there was no question about it: This was the place he was supposed to be. This was the city where Ross would make the Silk Road into the greatest start-up the world had ever seen. And yet, as he walked back along Sacramento Street, past those beautiful painted lady Victorian homes and the modern glass skyscrapers, Ross didn’t know that he would soon face challenges that no other start-up in the city would have to deal with. That in a matter of months he would find himself dealing with dirty cops and rogue employees, and Ross Ulbricht would have to decide if he wanted to have people tortured and killed in order to protect his growing enterprise.