VCs Kick Out Even Good Entrepreneurs

from the well,-duh dept

Someone I know who worked at a VC/incubator once described his job as “figuring out when and how to fire the founders”. That’s what VCs do. If you didn’t know that going in, you never should have tried to raise venture capital. A new study seems to be surprised when showing that even successful startups often have their founders kicked out by VCs. However, it’s pretty standard practice. There are different skills necessary in creating an idea, building a company, and then managing a company. Some people clearly have all of those skills. Others don’t. Many startups do need more professional management. The question is whether or not the entrepreneur knows his or her own limits. Admittedly, VCs are often too quick to pull the trigger, and look to install a “friend” to take more control over their investment. It’s just part of the process, and yet another reason that entrepreneurs who aren’t ready for that sort of thing should think twice before raising venture financing.

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