It's probably tricky for a business like a bakery because your orders would vary so much in size, so you'd have to have different tiers depending on the risk being borne by the business.
Like, $50 birthday cake? Pay with a credit card when you pick it up. $15,000 in pies next week? Here's a contract that stipulates the due date and what the penalties are, and names the collections agency which will come after you for the outstanding amount and any applicable penalties.
Probably get a lot more aggressive on your accounts receivables demands. Also, is this type of behavior typical of VC's? I have to assume a lot of people would just have written a check to pay vendors so this sort of bad PR wouldn't be coming up as it isn't that much money for a VC. Unfortunately it seems like a few bad apples here are really spoiling it for everyone.
* CEO James Beriker
* investors Sherpa Capital and Menlo Ventures