What’s up with the superiority complex exhibited by both venture capitalists and entrepreneurs?
A shiver goes down my spine when I hear a venture capitalist refer to a portfolio company as “my” company, or a CEO who runs one of those portfolio companies as “my” CEO. The implicit suggestion is that VCs are kings and founders are lowly grunts who exist only to humbly serve the capital-holding masters. Ugh.
This condescension goes both ways. It’s not uncommon for a founder to poo-poo the importance of investors suggesting financiers don’t know how to oversee start-up operations day-to-day.
As both an entrepreneur and a venture capitalist, I deeply believe that these stereotypes are not only wrong, but also foolish.
As a VC, I understand why VCs might claim seniority. After all, VCs typically join the boards of the companies they invest in, and boards have the ability to fire CEOs. So, in that way, start-up CEOs work for VCs. In addition, VCs often have the contractual rights to control a company’s destiny, especially if they hold preferred equity. VCs might be able to veto a company sale, or the issuance of any new security.
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