Venture Capital
Bad Moves VCs Make
Feb 21, 2024
Explore the murky world of venture capital with Jon and Peter as they discuss bad moves made by VCs. From last-minute deal changes to delaying investments for lower valuations, they provide valuable insights on the dynamics between VCs and founders. The debate on ethical practices like bribing founders and the importance of incentivizing the founding team adds depth to this engaging conversation.
26:14
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Quick takeaways
- VCs prioritizing personal gain over the best interests of the company highlights an ethical dilemma in venture capital.
- Introducing new terms at the last minute in a deal negotiation is considered unethical and can compromise the company's future.
Deep dives
Bad VC Move: Threatening to Veto a Deal for Higher Returns
In one example, a VC threatened to veto a company's exit deal unless their class of shares received a large dividend. The VC's motivation was to secure a better return, disregarding the potential negative consequences for the company and its stakeholders. While the frustration of the VC can be understood, it highlights the ethical dilemma of prioritizing personal gain over the best interests of the company.
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