In this week's episode of StrictlyVC Download Podcast, veteran VC Aileen Lee was direct about the recent boom and key consequences of the bust cycle. They also lost the champion who once supported them.
Lee is debating how limited partners are reluctant to criticise strong fund managers and fears they will be locked out of their investments in those companies once again. But she imagined they would say whether they could speak freely:
“Everyone wants to join the X-brand name fund, so they never criticize [for fear of repercussions] . . They probably talk about us behind our backs [laughs].. . But what they say is [that] All the people who have [were] I was hired by these venture companies during my time at ZIRP. . . They made a lot of cheap investments,” and now they are stretched their elbows except it's too late, Lee observed. “all [the LPs’] The people at Venture Jobs didn't stick to long enough to see if the company was successful, so basically the money was thrown into the drain. ”
It's not the fault of these new investors, Lee continued. “A lot of investment was made, with only a ton of people being given check books that were not trained and could not receive mentorship or apprenticeship. As a result, there are many orphan companies.
But there is another reason why startups are left to their devices. In many cases, businesses are orphaned by more senior general partners. [at the firm] However, he stopped attending the board. ”
For certain companies, it has been happening at this point for years. During the Go-Go symbiosis of fundraising, no one did that much due diligence. Also, corner cuts never stopped when it came to these same investments. But that is also an important reason why more and more companies struggle to find help outside their exit strategies, and why is LPS justified by voicing more frustration?
Another longtime VC, Jason Lemkin, told the editor in late 2022, “” when VCS first halted at a board meeting of a startup where VCS had lost momentum.[S]Are there no checks and balance? If millions of people are invested in pension funds, universities, widows, orphans and don't work hard along the way, do not continue hard work on the board invalidate some of the fiduciary's responsibility for LPS? ”
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