So do you think I (a non-Indian) would be at a disadvantage applying to Khosla's outfit [1]? If Khosla looks for people "like him", that should be the case.

Similarly, would an Indian founder be at a disadvantage applying to Fred Wilson? Somehow, I suspect any disadvantage would be minor, if it existed at all.

In any case, your theory of who "them" is now drawn quite broadly. It's not so much people looking for others "like them", it's more like looking for people from within an arbitrary subset that includes widely disparate and dissimilar groups (White and Asian Americans, Chinese, Indians, Israelis, Europeans).

[1] Ignore for the sake of argument that I'm the only non-Indian in my company.

You are narrowly reducing the "like him" assessment to race alone. It's culture + race that makes the determination. An Indian person has an easier time demonstrating that s/he is part of the mainstream culture. In my experience, educated immigrants, or children thereof, are often received as a blank slate and accordingly it's easy to see them as "one of us."

Most Americans, however, already have a conception of who Blacks and Hispanics "are" and it's not quite positive. They have a deficit initial position, where Indians and Chinese have a more-or-less neutral position. Moderately educated, well dressed Whites are generally neutral or positive. This may be in part due to the general American dislike of poor people -- immigrants who come to this country are usually educated and well off compared to the population of their country of origin, so the American over here only ever sees educated people from that place. However, that same American sees Black and Hispanic people all across the social spectrum, and can't help but have his opinion of that group lowered.

In my experience, the white guy who graduated from state college starts off -- in the mind of the person assessing him -- as well or better than the brown guy who went to a top tier school.

You're welcome to disagree, I'm sure you will object to some degree. This is only what I've observed.

"already have a conception of who Blacks and Hispanics "are" and it's not quite positive. They have a deficit initial position"

I agree. In a sense it's like a negative brand association. I would add that we could also discuss the positive association of blacks with sports or entertainment vs. some other minorities or even whites.

But Jewish and sports? No.

Jewish and Medicine? Yes.

His point is made, though, and it's a good one. This is definitely not simple "racism" as a substantial fraction of Indians are darker than the average African American or Hispanic.

You're starting from a false premise: racism (in the U.S.) depends only on skin colour.

The terms "white" and "black" when applied to race are not objective measures of skin-pigmentation. They're proxies for other traits. They are used differently in different cultures. For instance "black" in the U.S. may not be "black" in Brazil.

For example a light-skinned European from Spain would be considered white in the U.S. A person with the same appearance, but from Mexico would be considered Hispanic.

In my part of Canada, we generally don't refer to people as Hispanic. They'd just be white or maybe brown. Unless maybe they're poor and don't speak English or French.

He is saying that the tech clique is whites and asians. If you're not Indian but you're white (Chinese, Jewish, etc.) this does not put you at a disadvantage. If you're non-white and non-asian all things being equal you would be at a disadvantage.

This is not a very strong claim. It's been shown repeatedly with resumes and in loan applications that a black name/photo/applicant is less likely to move forward than a white photo/applicant with identical qualifications. It shouldn't be shocking that this exists in VC financing.

So here is the fundamental question: how did Indians/Chinese break into the "tech clique" and why can't Blacks do the same thing?

Extensive support from their own governments, for one. India and China are very serious about trying to export their own tech workers, and have put their education infrastructure where their mouths are. American-born Indians and Chinese have no doubt benefited from the halo of highly-skilled imported labor.

On the other hand, there isn't a "Black IIT" to bootstrap the tech reputation of blacks.

There certainly is a "Black IIT" to bootstrap the tech reputation of blacks. It's called "MIT". Most Black applicants who are as qualified as a typical IIT student will get in.

Most Black Americans also tend to have a higher quality primary education than the typical Indian student - their teachers tend to show up for work and their schools tend to have toilets with > 2 nines of uptime.

As for "very serious about trying to export their own tech workers", their efforts have made it considerably easier for Indian/Chinese workers to get an H1B. I guess you are right - Black Americans would probably have a hard time getting an H1B.