VCs to avoid taking money from

http://www.startupcfo.ca/2013/01/who-not-to-take-money-from/

by BerislavLopac • 14 years ago

81 42 14 years ago

startupcfo.ca

chris_wot5• 14 years ago

Is there anybody left?!?

meric• 14 years ago

Yes, Mark MacLeod.

loceng• 14 years ago

Quick! Everybody ask him for 1-3 hours per week of time! Surely he has unlimited time.

chris_wot5• 14 years ago

I had a look at his LinkedIn profile, and this is what I found:

1. A finance guy

2. A name dropper of numerous corporations... Mind you, this is LinkedIn... But I seem to see that in a lot of places...

3. A director on 4 boards

4. A snappy dresser: http://about.me/markmacleod

Ok, I'm being harsh here. I'm sure he's fine, but if you followed his own advise, you'd have to rule him out!

ihaveajob• 14 years ago

Probably not a popular place to talk about that, given the audience :)

confluence2• 14 years ago

> On a similar note, it’s pretty fashionable these days to see party rounds with lots of investors each putting in a small amount of money. Mark Suster calls this collecting logos.

Collecting logos - now that's a new one. I used to call that "buying trophies" :)

Another saying that I have about Silicon Valley is that it's "Wall Street with jeans".

There's a lot of money, and a lot of power sloshing around. It's not all fairytales and lollipops. When you get here prepare to get fucked. Repeatedly.

Before dealing with anyone always ask yourself this question:

> "How are they fucking me?"

It's a line I stole from Jim Messina - Obama's reelection campaign manager. It's proven quite useful.

Oh and one last important heuristic: never trust a suit. Engineers can be pretty bad at fucking each other when they become founders - but then again by then they're just suits.

An even better heuristic: trust no one.

PS - watch this video and get your cynicism on: https://www.youtube.com/watch?v=uzNRUkl9BoY

neumann_alfred• 14 years ago

Also see George Carlin's rants about business men (and women with shoulder pads who repeat the worst mistakes of men) ^^

gesman• 14 years ago

It's a loser's game to bitch about inexperienced bankers or laugh about celebrities.

Winners do whatever necessary to engage their business idea. That may or may not include taking money from anyone in that list.

bdcravens• 14 years ago

You're not just taking on money, you're taking on a partner in your venture. Just because they sign a check doesn't mean they can't harm you in some way.

There's a term for someone who will take on a partner no questions asked, as long as they have enough money ....

confluence2• 14 years ago

Wonder how you'd choose to marry someone...

Winners marry for money! Only the game matters!

I wonder if you're actually trolling or just incredibly naive.

chris_wot5• 14 years ago

I don't think he was talking about success in any area of life except raising venture capital.

antr• 14 years ago

Although I agree with most of the "groups" mentioned, most of the time, beggars can’t be choosers.

It's a shame so many investors talk about which types of people not to take money from but never give names. It's high school all over again.

jaredstenquist• 14 years ago

Looks like you could use some VC money to keep your blog online :)

imwhimsical• 14 years ago

I seem to have developed an aversion beyond words can convey, about people who shamelessly rip-off the svbtle layout. This is simply wrong on so many levels.

And you've just made it look uglier with those noob-ish buttons.

tomasien• 14 years ago

Do people in SV really have the luxury of picking and choosing their VC's like this? Man that sure hasn't been my experience.

majani• 14 years ago

A lot of startup articles need to come with a disclaimer: "FOR SILICON VALLEY ONLY."

I really don't think they appreciate just how unique their situation is over there.

jusben1369• 14 years ago

I'm not sure that matters here. This is more a guide to knowing the types - and they exist in all markets large and small - so you can avoid or best case prepare. Many on this list won't invest so it's good to weed them out and save you time and heartbreak.

jpdoctor• 14 years ago

> But unless a potential investor is listing people he plans to intro you to, you shouldn’t be hearing names.

But remember: Anyone that he lists does not work for you. Odds are high that your company will fail, and that person knows where his next meal ticket is coming from.

photorized• 14 years ago

How about avoiding VCs in general. Unfortunately, that's not how things are done these days.

grinich• 14 years ago

Raising VC is kind of like buying a car. If your destination is decently far away, it makes a lot of sense.

The problem is that a lot of these folks don't know how far they're actually going. They end up buying a car to drive around the corner or just down the block. And now they have to deal with parking, gas, insurance, etc.

Even worse, they're usually going in the wrong direction initially. It's a much better strategy to start on foot, go for a quick walk, and then get a bicycle. When the bike's tires are bald, then it's time to think about buying a car.

If you've driven there before (or somewhere very similar) either alone or in the passenger seat, then maybe you can skip straight to buying a car. But then again, it's a different time of day and traffic is unpredictable.

And once you're driving, don't be afraid to pull over and ask for directions!

gtt• 14 years ago

Great analogy, thank you.

doktrin• 14 years ago

I sort of wish this wasn't in a sub-comment, because it's a valuable contribution that may get buried.

ahoyhere• 14 years ago

Alternatives: taxi, Zipcar, rideshare, Uber, renting a car, leasing a car. It's a pretty good metaphor because you really don't need to buy a car to go "decently far away" at all. A one-time car service charge of $1k is a lot better than a $20k loan.

notdonspaulding• 14 years ago

"VCs from whom you should avoid taking money"

orangethirty• 14 years ago

From my own experience:

The cattle farmer:

Goes to pitch events to pick startups to invest to. Watches every pitch as if it was cattle on the auction block.

The Bro:

Only invests because he thinks you are cool. No interest whatsoever in seeing you succeed.

The mother:

Wants people to know that he gave birth to your idea.

The loan shark:

Calls every week to ask you about his money.

The infomercial:

Only talks about how awesome your life/starup would be if you did X (something they came up with).

cloudsteam• 14 years ago

I could do with a Bro for my site

rmangi• 14 years ago

The mother is probably a she ;-)

euros• 14 years ago

I once had a "potential investor" (worth $80m) who wanted a meeting with my patent attorney. So, I made the arranged for us to meet him at our usual meeting place - the coffee shop.

We walked in and the "potential investor" said: "we haven't got time for a coffee", I replied: "well, this is where we are having the meeting"... "what HERE? doesn't he have an office? This is a very bad start."

In walked my patent attorney wearing a cagoule and a rucksack. The "potential investor" made it perfectly clear that he was not impressed (he did not even get up to shake his hand). He interrogated him for half an hour before saying: "good, you can now drink your coffee".

I realised that day, that money, is only a small part of being a great VC.

hnriot• 14 years ago

This happens a lot and tech is not without its elitists, but that doesn't excuse rude behaviour. I have found this happens a lot, but a lot less than in England. Fortunately we have people like Zuck in a hoodie and Brin on the subway, both with more money than god to thank for leveling the playing field a little.

Next time, don't wait for the VC to let you drink your coffee. You could be American about it and pander to his/her ego, or you could be British (since you use both word forms I am assuming you're also a transplant) about it and tell him to go fuck himself.

saosebastiao• 14 years ago

Might want to avoid saving your female pronouns for titles like "The Blabbermouth".

LukeShu• 14 years ago

He also used female pronouns for "The Generalist", and used "he or she" for "The dude on 20 boards".

My guess is that he was thinking of specific people when he wrote each.

hhuio• 14 years ago

I'm really interested who this yacht guy is :)

gyardley• 14 years ago

Must we really go around calling a bunch of random people 'douche bags' for behavior that in some cases, isn't even remotely problematic?

One of the most astute VCs I know and have worked with came from money and knows his way around a regatta. Hell, I've even seen him with a pastel sweater around his shoulders.

According to this random CFO guy I've never heard of, that makes my VC a 'douche bag' - but if I was raising money again, I would have that VC involved again in a second.

Sometimes criticism teaches you more about the criticizer.

patrickk• 14 years ago

I think the title is somewhat misleading.

"Types of VCs to avoid taking money from" would be better. It sounds like he's going to name actual people to avoid, rather than general VC archetypes.

radley• 14 years ago

I wish the title wasn't changed. The original was more vague and matched the stereotype based list.

f4stjack• 14 years ago

On a totally unrelated note, is it me only who found this site's hiding of svbtle theme disclaimer disturbing?

lmm• 14 years ago

Yup, just you.

VCs to avoid taking money from

Related Stories