December 05, 2023

Edu: VC Horror Stories - Critical Capital Catastrophes

40 minutes

VC fundraising.

A crucial way to rapidly expand your startup. The best VC relationships will elevate your startup to another level while poor ones can make your startup lame. This week on The Startup Podcast, Chris and Yaniv venture into the shadows of fundraising as founders expose harrowing tales of dealing with unscrupulous venture capitalists. 🕵️‍♂️

🤝 False Promises: Some VCs masquerade as venture studios, luring founders with promises of substantial support in exchange for hefty equity. In reality, founders are left to navigate the entrepreneurial journey alone.

🤐 Confidential Betrayal: Unethical practices emerge as certain VCs breach trust by sharing founders' confidential information with competitors, exploiting sensitive details for a competitive edge.

💸 Lowball Offers: Founders face the peril of VCs making undervalued offers, jeopardizing the startup's equity structure and hindering its path to success during critical funding rounds.

👻 Investor Ghosting: Post-investment, some VCs vanish, leaving founders in the lurch. While investor support is crucial, the absence of ongoing assistance can hinder a startup's growth.

⏳ Funding Delays: Founders experience intentional delays in funding after agreeing to term sheets, introducing pressure tactics or blocking potential competitors.

💰 Fee Excess: Unscrupulous VCs exploit founders by charging fees and claiming cuts from subsequent funding rounds, compromising equity in exchange for essential capital.

There’s a lot of horror stories out there. Don’t fret! Yaniv and Chris are here to help you through the process so you don’t have your own horror story. They explore how to get the best out of VC including:

🕵️‍♀️ Vetting Investors: Founders are reminded to meticulously vet potential investors, discern their priorities, and avoid falling prey to "innovation theater" or compromising their vision too quickly.

🚀 Clean Relationships: The essence of successful fundraising lies in forging transparent, straightforward relationships with investors who genuinely empower founders rather than exploiting them.

Explore the dark side of fundraising and glean insights on navigating the complex VC landscape. Watch the full episode for cautionary tales and strategic wisdom.

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Key links

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Learn more about Chris and Yaniv

Work 1:1 with Chris: http://chrissaad.com/advisory/

Follow Chris on Linkedin: https://www.linkedin.com/in/chrissaad/
Follow Yaniv on Linkedin: https://www.linkedin.com/in/ybernstein/

Credits

Lovingly handcrafted for the global startup community by:

Editor: Justin McArthur

Associate Producer: Aidan Cousins

Intro Voice: Jeremiah Owyang

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By Yaniv Bernstein, Chris Saad

3636 ratings