Revisionist historians I tell you.

Let’s back up for a second.  The entire [flawed] VC model is based on:

1- talking a lot about being a risk taker, but then:
2- investing in the same old people, with the same old models, doing the same tired things
3- plowing too much money too early on in order to to take control
4- celebrate the funding more than the exit (this is key folks, re-read a few times if need be)

Then repeat stage 2 and 3 a few times until the time

a) when the founders are so diluted they could care less about the company
b) there’s been enough turnover that no one really takes ownership of problems or cares about results

Eventually, as is the case with 99% of startups, everyone realizes that this idea was pretty lame and the VCs just needed “big ideas” and “big names” to eat up their funds…

Once it is clear that this company won’t be the home run needed to make up for the other clunkers in the VC’s portfolio, then “tough times call for tough decisions” and suddenly, VCs force management into crazy options:

- fire 90% of the company and go white label
- fire 75% and scale back until a greater fool comes around and buys the sucker, ensuring that the VC at least gets its investment back while everyone else gets squat.
- shut down the crapper.

I, for one, call bullshit.

A lot of people smarter and richer than me say “you should raise as much money as you can” but that is hogwash.

VCs have 5-10 other companies in their portfolio, so naturally they don’t care about your company and your staff nearly as much as they should.  Raising too much money makes you throw cash at problems.  This is basically why VC-funded startups seem to have a greater failure rate than bootstrapped companies.

All right, I feel better.  Back to work.