Is there such thing as taking bad money when working with venture capitalists? originally appeared on Quora - the place to gain and share knowledge, empowering people to learn from others and better understand the world.

Is there such thing as taking bad money when working with venture capitalists?

Oh geez yes.

Venture capitalists are humans who work in their venture capital firm which is really just a business. Some humans are awesome. Some businesses are awesome. Some humans and businesses are not so awesome.

Things that make a VC's money "bad" money:

  • The VC firm works within ethics that don't match yours. Ethics are laws of behavior that aren't governed by the laws of the country you are working within. If your VC does business in a way that you find disturbing, then they will probably expect you to make some disturbing business decisions in the future.
  • The VCs themselves don't treat you like an equal. The VC provides cash and the founder provides equal value in the form of a growing company. This should be an equal exchange, therefore you should be treated like an equal.
  • The founders of the VC's portfolio companies aren't happy with their VC. VCs are often compared to parents. There are great parents and terrible parents. Listen to the people who have taken money from these VCs and see if they would make the same choice again.

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Published on: Dec 6, 2017