[AndrewKemendo]

Everything you wrote was par for the course for a private equity company (note that venture capital is a tiny subclass of private equity)

The founder kept everything because investors expect that their relationship with this person is going to continue and eventually this person is going to “make the fund” in a future venture

That’s the key thing here, as a CEO/founder if you have gotten the stamp of approval from venture/capital class (in the form of a series A conversion on a note, or some kind of liquidity event), as long as you’ve pledged allegiance to returning investors capital above all things, you can “fail” a lot actually, and it’s pretty much ok as a writedown.

Provided that you keep investors legally at the front of the line, they will be willing to continue to invest in you.

This is why you see all these people put “serial founder” in their bios, they want to signal that they are a reliable person for finance to come to

[earnesti]

I'm not sure that VC's will be investing in the company of a failed entrepreneur. At least something should have changed to make the company "better". In Gumroads case the truth was that the money would be pretty much gone, the company is not going to be valuable. He didn't raise this time from VC's, but from clueless retail investors, which is quite a different thing.

[tschwimmer]

As a strong counterpoint, Adam Neumann lost $16B of Softbank's money and walked away with almost a billion of it himself personally. [0]

He later raised 350m from A16Z[1], so this is not universally true and in fact is a pretty big counterpoint. Adam Neumann is about the worst founder you can fund (Maybe SBF is worse) and can still command vast sums from top tier VCs.

[0]https://www.calcalistech.com/ctechnews/article/a8vuka5hj [1] https://www.google.com/search?q=adam+newman+new+company+fund...

[cjbgkagh]

As best I can tell VCs largely attribute their 99% failure rate to largely random chance rather than their own inability to pick winners - so the failure of an entrepreneur is not a particularly strong mark against them and a weaker mark than the fact they got funding in the first place.

[darth_avocado]

> I'm not sure that VC's will be investing in the company of a failed entrepreneur

Andreessen Horowitz has entered the chat with a $350M check for Adam Neumann