 Allison Robbert/ReutersTHE SCOOP A group of Silicon Valley bigwigs have been in talks to join the Donald Trump administration, but government ethics rules requiring divestitures of certain investments are getting in the way, according to people briefed on the matter. People who accept full-time federal positions are generally required to dump investments that represent a conflict of interest or place them in a blind trust, and step down from private sector positions. That’s especially difficult in Silicon Valley, where startup stocks are illiquid and sometimes prohibit secondary market sales. And venture capital funds, where many of Trump’s tech backers work, usually include provisions that require key partners to remain involved in the fund’s work or risk triggering provisions that put major limits on its operations. Those complications have pushed some tech luminaries toward advisory roles that operate outside the government, but can have less power. Last week, the venture capital world was buzzing about Trae Stephens, a partner at the Founders Fund and chairman of defense tech firm Anduril Industries, being considered for a senior role at the Defense Department, according to three people familiar with the matter. But earlier this week, it appeared less likely that Stephens would serve inside the government, and might instead be added to a civilian advisory board that counsels the Secretary of Defense. It’s unclear why Stephens’ potential position changed, but one person familiar with the matter cited his investments as a factor. Through a spokesperson, Stephens declined to comment. Even Elon Musk, a key Trump ally, will become the co-head of the Department of Government Efficiency, or DOGE, which will operate outside the federal government and cease operations in two years. For Musk, divesting from his business interests and stepping down from his corporate roles would be catastrophic for shareholders and employees. The requirements could add a complicating layer to the Trump administration’s efforts to reform the Department of Defense. Silicon Valley investors have been pushing for reforms of government procurement practices that favor established contractors like Lockheed Martin, Raytheon, Boeing and others. Trump’s victory a week ago appeared to be an opportunity for progress in that area. The day after the US election, Musk tweeted at Anduril Co-Founder Palmer Luckey, who created Oculus, that it was important to open the Pentagon and intelligence community to “entrepreneurial companies like yours.” | 
