Developer of Glitchy Iowa Caucus App Deeply Embedded in Democratic Establishment

Statement from Shadow CEO apologizing for the chaos surrounding the Iowa caucus stemming from their glitchy app.

Former Barack Obama campaign staffer and Democratic operative Tara McGowan is denying that her high-profile liberal firm ACRONYM played a role in the Monday evening Iowa caucus debacle, claiming that her firm was merely an investor in the company Shadow, Inc., which developed the IowaReporterApp, the malfunctioning smartphone app at the center of the controversy. But internal company documents, a source close to the firms, and public records show a close and intertwined relationship between Acronym and Shadow — Acronym isn’t simply an investor in Shadow, Inc., it’s the only investor.

In addition, ahead of the caucuses, questions swirled inside Shadow over the company’s ability to deliver a quality product, and there was concern from at least one staff member that senior leaders of Shadow and Acronym — both of which were launched as a new Democratic bulwark against President Donald Trump — have been far from neutral in the Democratic primary.

Kyle Tharp, a spokesperson for Acronym, released a statement on Monday night downplaying his company’s affiliation with Shadow.

“ACRONYM is an investor in several for-profit companies across the progressive media and technology sectors,” Tharp said. “One of those independent, for-profit companies is Shadow, Inc, which also has other private investors.”

David Plouffe, a former campaign manager to Barack Obama’s 2008 presidential bid who joined Acronym’s board, also distanced himself from the company during an MSNBC panel last night. “I have no knowledge of Shadow,” said Plouffe. “It was news to me.”

But previous statements and internal Acronym documents suggest that the two companies, which share office space in Denver, Colorado, are deeply intertwined.

Last year, McGowan, a co-founder of Acronym, wrote on Twitter that she was “so excited to announce @anotheracronym has acquired Groundbase,” a firm that included “their incredible team led by [Gerard Niemira] + are launching Shadow, a new tech company to build smarter infrastructure for campaigns.” McGowan also noted that “With Shadow, we’re building a new model incentivized by adoption over growth.” The acquisition was announced in mid-January of last year.

In an interview on a related podcast last month, McGowan described Niemira as “the CEO of Shadow, which is the technology company that Acronym is the sole investor in now.”

What’s more, internal documents from Acronym show a close relationship with Shadow. An internal organizational chart shows digital strategy firm Lockwood StrategyFWIW Media, and Shadow as part of a unified structure, with Acronym staff involved in the trio’s operations.

In an all-staff email sent last Friday, an official with Lockwood Strategy reminded team members about “COOL THINGS HAPPENING AROUND ACRONYM.” The list included bullets points such as, “The Iowa caucus is on Monday, and the Shadow team is hard at work,” and “Shadow is working on scaling up VAN integration with Shadow Messaging for some Iowa caucus clients.” (VAN refers to NGP-VAN, the widely used Democratic voter file technology firm.) Acronym staffers also attended the Shadow staff retreat.

A person with knowledge of the company’s culture, who asked to remain anonymous for fear of reprisal, shared communications showing that top officials at the company regularly expressed hostility to Sen. Bernie Sanders’s supporters. McGowan is married to Michael Halle, a senior strategist with the Pete Buttigieg campaign. There is no evidence any preference of candidates had any effect on the coding issue that is stalling the Iowa results.

Federal campaign finance records show that the Iowa Democratic Party and the Nevada Democratic Party retained Shadow to develop its caucus app. “State campaign finance records indicate the Iowa Democratic Party paid Shadow… more than $60,000 for ‘website development’ over two installments in November and December of last year,” HuffPost reported late Monday. “A Democratic source with knowledge of the process said those payments were for the app that caucus site leaders were supposed to use to upload the results at their locales.”

According to Federal Election Commission filings, Shadow has also been retained for digital services by Pete Buttigieg’s campaign, which paid the company $42,500 for “software rights and subscriptions” last July, and by Joe Biden’s campaign, which paid Shadow $1,225 for text messaging services, last July as well. Former contender Kirsten Gillibrand also paid Shadow $37,400 for campaign work.

This is the first year the app was used, and Iowa Democratic Party officials insisted on keeping the details of the app, as well as Shadow’s involvement, hidden from the public ahead of the Iowa caucus. The New York Times reported that “its creators had repeatedly questioned the need to keep it secret.” But as Monday night wore on and frustration with the delayed reporting of the caucus results boiled over, journalists began scrutinizing the new technology and its developer more closely.

The New York Times, citing anonymous people who were briefed on the app by Iowa Democratic Party officials, reported that the app was hastily constructed in just two months and “not properly tested at a statewide scale.”

“The party decided to use the app only after another proposal for reporting votes—which entailed having caucus participants call in their votes over the phone—was abandoned, on the advice of Democratic National Committee officials,” the Times reported.

The IDP said last month it wanted to use the app, according to the WSJ, because it would be a quicker way to tabulate the caucus results from the state’s nearly 1,700 precincts.

“The secrecy around the app this year came from the Iowa Democratic Party, which asked that even its name be withheld from the public,” according to the Times. “There were concerns that the app would malfunction in areas with poor connectivity, or because of high bandwidth use, such as when many people tried to use it at the same time.”

Throughout the caucus yesterday, according to the Times,  several IDP county chairs said the app was giving them trouble, and when they attempted to use a telephone hotline to call in results, the wait time was up to an hour. Democratic officials reported widespread problems downloading and installing the app and inconsistencies uploading caucus results, leading to the Iowa Democratic Party’s decision to take the unusual step of delaying the release of the results.

In a fresh statement on Tuesday, IDP chairman Troy Price said the error came down to a “coding issue,” and that while underlying data that it collected was “sound,” it only provided partial data. He added that the problem had been fixed.

As caucus voting dragged on last night, the IDP released a statement denying that the app did not go down, and that “the underlying data and paper trail is sound.”

However, the Wall Street Journal reported that cybersecurity experts were alarmed by the IDP not publicly disclosing the app maker, and, citing unnamed sources, said that IDP officials did not take up the Department of Homeland Security’s offer to security-test the app.

The Times reported that there were concerns the app would malfunction due to poor connectivity or a lack of bandwidth, citing an unnamed person familiar with the app.

The campaigns have reported their unverified internal numbers: Bernie Sanders’ camp claimed about 29% of delegates and Pete Buttigieg’s said they were on the path to victory, while a Warren spokesperson said it was close between Warren, Sanders and Biden.

The IDP expects to formally announce results some time Tuesday, although it could take longer. Price said: “Our ultimate goal is to ensure that the integrity and accuracy of the process continues to be upheld,” NBC reported. The Nevada Democratic Party issued a statement Tuesday afternoon saying they will not use the app in their caucus later this month, after multiple outlets reported that the party would indeed use the app.

This is the second snafu for the Iowa caucus. Saturday night’s Des Moines Register/CNN poll results were withheld after Buttigieg’s campaign complained his name was left off a telephone survey earlier in the week.

Acronym launched with a promise to compete with the Trump campaign’s strong emphasis on digital media, launching Democratic messages through paid advertisements on Facebook and other platforms. But the source said the company in many ways was woefully unprepared for the many challenges it had taken on, including the Iowa caucus app.

A precinct captain for Sanders, who requested anonymity because they were not authorized to talk to the press, confirmed that the rollout was rushed. “We didn’t know about the app until like a month ago. And we didn’t have access to the app until like three days ago,” the source said.

“This app has never been used in any real election or tested at a statewide scale and it’s only been contemplated for use for two months now,” David Jefferson, who also serves on the board of Verified Voting, a nonpartisan election integrity organization,  told the New York Times.

Shadow was launched by former staffers to Hillary Clinton’s 2016 presidential campaign, including Niemira, Krista Davis, Ahna Rao, and James Hickey, according to professional biographies listed on LinkedIn. Shadow did not respond to a request for comment.

Acronym, which includes a hybrid model of a 501(c)4 entity that does not disclose donors and a Super PAC that does, has been a favorite for deep-pocketed Democratic donors. Donald Sussman, the founder of Paloma Partners, and Michael Moritz, a partner at Sequoia Capital, each donated $1 million to Acronym last year. Filmmaker Steven Spielberg gave $500,000. Investor Seth Klarman, once a major donor to Republican causes, gave $1.5 million to Acronym.

Acronym appears to have deleted portions of its website showcasing its involvement in Shadow. “ACRONYM is thrilled to announce the launch of Shadow, a new technology company that will exist under the ACRONYM umbrella and build accessible technological infrastructure and tools to enable campaigns to better harness, integrate and manage data across the platforms and technologies they all use,” wrote Niemira in a now-deleted blog post.

This morning, William McCurdy II, the chair of the Nevada Democratic Party, released a statement announcing that the party will not be using the Shadow app for its February caucus.

“NV Dems can confidently say that what happened in the Iowa caucus last night will not happen in Nevada on February 22nd. We will not be employing the same app or vendor used in the Iowa caucus,” said McCurdy. “We had already developed a series of backups and redundant reporting systems, and are currently evaluating the best path forward.”

*This article was expanded from original report by Lee Fang first published Feb. 4, 2020 by The Intercept.

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