I'm not so sure that Tim was investing for reasons other than those for which he normally invests. Remember that venture capitalists need good opportunities as

I'm not so sure that Tim was investing for reasons other than those for which he normally invests. Remember that venture capitalists need good opportunities as much as good opportunities need capital. If Theranos had worked out, would everyone have said that Holmes should have given other investors a chance and not just given her next door neighbor an early in? If you want to have guys like Tim giving smart young people a chance, you can't have it both ways. Either: A) He can invest in whatever good opportunities come along without making them jump through a lot of hoops, and whoever comes after with big money should do their own diligence OR B) He should take responsibility for the actions of other people seeing his investment as a proxy for due diligence, and thus have the same standards for seed funding as he would have for a later round. I think there is fault in the SV system, but shouldn't it be laid at the feet of those who put in the $XXX million without DD, not the guy who put in $500k? YC takes similar chances on people, and that's a good thing. The problem is when the prestige attached to being chosen gets out of hand, and other people think Draper or YC have done their job for them. Full disclosure: I was a founder who worked with Tim for 6 years. I know nothing about the Theranos situation, and I'd never heard of them before the recent press storm. That said, having known Tim, I could totally see him investing based only upon her being smart and making a good case to him. He does really seem to want to invest in smart young people. I say this based on my own interactions with him, having once been a young person who thought I was pretty smart.