Three of our worst VC stories
Positive VC Experiences
- Several commenters stress that most VC interactions are “boring”: pitch → polite yes/no → occasional intros and advice.
- Specific positive stories include:
- A board member who discovered an incorporation/stock-plan error during a nearly $1B acquisition and persuaded all investors to give up part of their holdings so the founder wouldn’t lose a huge portion of the payout.
- VCs and firms described as “class acts,” consistently backing founders, being founder‑friendly, and staying engaged for a decade or more.
- An investor who quickly declined a pitch but then spent the remaining time explaining why the idea wasn’t venture‑backable and teaching the founders how VC works.
Common and Extreme VC Misbehavior
- Multiple horror anecdotes:
- A partner allegedly refusing to invest in an early Cloudflare round because he didn’t believe a woman could lead a security infrastructure company.
- A prominent investor advising a founder to push out cofounders and take their equity, seen as a major red flag and “psychopathic.”
- A VC flying founders across the country for a breakfast meeting, refusing to hear a pitch once he learned they had no paying customers yet, and sending them away after a few minutes.
- Angel groups staging humiliating, performative pitch dinners (long waits, awkward presentation format) and then billing founders for their meals.
- Reports of LPs engaging in serious misconduct (including sexual assault) and pressuring CEOs into unethical financial maneuvers.
Wealth, Competence, and Character
- Many argue extreme wealth is only loosely related to competence or intelligence; luck, timing, social signaling, and nepotism are repeatedly mentioned.
- Some see psychopathy or extreme ruthlessness as common among top VCs; others suggest veteran investors become desensitized rather than inherently sociopathic.
VC vs. Bootstrapping and Founder Strategy
- Several participants say stories like these push them toward bootstrapping, especially in a world where AI and small teams can build profitable niche SaaS without outside capital.
- Others note that the “game” of hypergrowth and billion‑dollar outcomes is structurally tied to VC, and that VCs and founders have fundamentally different portfolio vs. singleton incentives.
Other Topics
- Brief discussion of Cloudflare’s success vs. its long‑term unprofitability, leading to mixed views on whether passing early was rational.
- Notes on HN’s preference for linking to canonical sources, a clarification that Monday meetings usually mean partner meetings, and a short tangent about running local AI models on consumer GPUs.