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It's not a "lie"- do people honestly expect VCs to just hand over money willy-nilly? Obviously, it is an investment, and they expect to make a return on their i

It's not a "lie"- do people honestly expect VCs to just hand over money willy-nilly? Obviously, it is an investment, and they expect to make a return on their investment. I blame dumb Founders, not VCs, for thinking otherwise.

lainga 8y ago
Hey! As a non-white non-Ivy League person I take umbrage at your characterisation of me as "willy-nilly".
rayiner 8y ago
> It's not a "lie"- do people honestly expect VCs to just hand over money willy-nilly? The article takes exception to the practice of funding people who disproportionately have friends and family wealthy enough to make a first-round investment, who are disproportionately white men, who disproportionately come from a handful of educational institutions, etc. It's an odd dichotomy to assert that funding decisions that ignored those factors would be "willy-nilly."
- tptacek 8y ago
  It seems to me that the only observation being made here is that in the absence of any financial or meaningful social proof for your business, you're not going to get funded as a first-timer. There are marginal bits of financial and social proof that privileged people start with, sure, but who does that surprise? That's true of every competition in society. The answer isn't to call out "the lie" (I mean, the market for funding is pretty dishonest, but calling it out isn't especially productive). It's to recognize how the modern startup financing market works and plan accordingly. 1. Apply to reputable accelerators as a hail-mary. 2. Execute a plan that works without external funding and accumulates the proof you need for financing. 3. Repeat until accumulated proof suffices for talking to investors directly (by which point you may be on the Mailchimp trajectory anyways and won't care anymore). The role of VCs as gatekeepers is, I think, pretty overrated, and gets more overrated every year.
- asdsa5325 8y ago
  Companies are taking a risk by investing- so if they find people who come from top schools, and who already have gained initial seed funding and completed work, then that lowers risk. My point still stands.

lainga 8y ago

Hey! As a non-white non-Ivy League person I take umbrage at your characterisation of me as "willy-nilly".

rayiner 8y ago

> It's not a "lie"- do people honestly expect VCs to just hand over money willy-nilly? The article takes exception to the practice of funding people who disproportionately have friends and family wealthy enough to make a first-round investment, who are disproportionately white men, who disproportionately come from a handful of educational institutions, etc. It's an odd dichotomy to assert that funding decisions that ignored those factors would be "willy-nilly."

tptacek 8y ago
It seems to me that the only observation being made here is that in the absence of any financial or meaningful social proof for your business, you're not going to get funded as a first-timer. There are marginal bits of financial and social proof that privileged people start with, sure, but who does that surprise? That's true of every competition in society. The answer isn't to call out "the lie" (I mean, the market for funding is pretty dishonest, but calling it out isn't especially productive). It's to recognize how the modern startup financing market works and plan accordingly. 1. Apply to reputable accelerators as a hail-mary. 2. Execute a plan that works without external funding and accumulates the proof you need for financing. 3. Repeat until accumulated proof suffices for talking to investors directly (by which point you may be on the Mailchimp trajectory anyways and won't care anymore). The role of VCs as gatekeepers is, I think, pretty overrated, and gets more overrated every year.
asdsa5325 8y ago
Companies are taking a risk by investing- so if they find people who come from top schools, and who already have gained initial seed funding and completed work, then that lowers risk. My point still stands.