[taylorwc]

Have you ever taken money from outside investors? It doesn't really matter whether the investor expects loss or at least is aware of the risk. Losing other people's money when they took a bet on you is a miserable feeling. Add it on to the list of things that can keep you awake at night when you're a founder or startup exec.

[dataker]

No I haven't, but I have money on companies.

Many things can happen (disease, conflict, competition,etc) and I surely won't make a founder feel terrible about himself because of that.

Instead, I pick someone with a different personality, industry and network that is able to balance my risk.

[taylorwc]

I applaud that you would never try to make a founder feel terrible intentionally. That said, most founders end up struggling with those feelings regardless. It's an awful feeling, even if you know your investors understand that there is huge risk and don't demand a guaranteed home run (not that there is such a thing).