At a $15 million Series A pitch meeting with 12 people present, a venture capitalist reportedly fell asleep. This story, shared by Greg Isenberg, quickly went viral on X, sparking a broader conversation among founders about their worst VC experiences, according to TechCrunch and The Tech Buzz.
Venture capitalists have long wielded immense, often unquestioned power over founders. Now, founders are leveraging social media to publicly challenge and expose that power. The shift signals a new era of accountability.
The increased transparency and public shaming of bad actors will likely lead to greater accountability for VCs, potentially fostering a more equitable and professional funding environment.
The Sleeping VC and Other Audacities
Greg Isenberg's account of a VC falling asleep during a $15M Series A pitch, as reported by TechCrunch, is hardly unique. Mark Pincus and Liz Wessel also received investment offers from VCs who had dozed off during their meetings, according to Zamin Uz. The display of such blatant disrespect by VCs, yet still extending offers, highlights a historical power imbalance, where their capital was deemed so indispensable that basic professional courtesy became optional.
Beyond Rudeness: Discrimination and Unethical Advice
The issues extend beyond mere rudeness. Matthew Prince recounted a Sequoia partner passing on Cloudflare, reportedly due to a disbelief that a woman could lead a security infrastructure company, according to TechCrunch. Prince further recalled Vinod Khosla advising a founder to 'fire' co-founders and seize their stock. Such named accounts expose not just overt bias but a deeper vein of ethically questionable counsel within venture capital.
A Pattern of Poor Practice
Beyond individual affronts, founders detail a pattern of poor practice: investors backing out of last-minute deals, disappearing without transferring promised funds, or demanding extensive reports and revenue share without ever investing, according to Zamin Uz. The diverse range of abuses suggests a systemic issue, not just isolated incidents, revealing exploitative practices embedded within the VC ecosystem.
