4 Disrespectful Things VCs Do to Founders
After reading hundreds of investor interactions submitted to the Know Your VC platform this week, it’s clear that meetings between founders and VCs aren’t always what they seem when motives don’t align.
Here are 4 different situations our founders have reported where the investor acted inappropriately.
1. Cold Emails to Brain-suck Founders
Some VCs (often associates) send mass cold emails to founders — not to establish a relationship, but rather to collect industry data or evaluate their company against a competitor.
It’s okay for investors connect with founders to talk about these things, but many carry the false pretense of actual interest in funding a founder’s company.
Often times this will get a founder’s hopes up, only to be crushed when he/she finds out a few weeks later that the firm has funded a competitor.
2. Lack of Homework
Before pitching a VC, it’s good practice for founders to learn more about the firm, its past investments, and its investing philosophy.
Conversely, many VCs take the same “laissez faire” approach. They neglect to learn more about a company before hearing a pitch, which makes the meeting less productive and more challenging.
Sometimes VCs, especially ones who have achieved a lot of success in the past, try to cover up their lack of preparation by talking down to founders. Inaccurate and unresearched comparisons and comments about a company can sway a meeting room and destroy a founder’s chances of getting funded.
3. Stringing a Founder Along
Getting a direct “no” from a VC is famously hard.
Many founders on our platform have shared experiences of VCs string them along for weeks when they have no intention of investing in their company. Common red flags include postponing meetings, requesting data they know will take a good deal of time to produce, or passing the founder to another colleague in the firm.
As tough as it is to swallow, these are all indirect ways of them saying “no” and it’s best for the founder to move on to avoid wasting more time.
4. Harassing/Projecting Bias Toward Founders
In the wake of several well-known VCs being exposed for sexually harassing and assaulting founders, many more founders have come forward sharing stories of how they faced bias and discrimination from investors.
From an investor asking a founder of color if he had a “rough upbringing”, to another asking if a female founder had a “backup CEO” just in case she got pregnant, founders on our platform have reported many instances of harmful discrimination and harassment.
If you are a founder and would like to share an experience you had with an investor, good or bad, we would love to hear from you.
Help us in increasing accountability and transparency in the venture world.
