[aclements18]

Your perspective is correct, but the vast majority (99%) of new businesses in the economy will never raise money from a VC (and shouldn't).

Most VC portfolios are structured such that the expectation (at least at the time of investment) is that this company will be able to make up for ALL the inevitable losses I am going to take in the other companies I invest in. Well, not really that cynical, but in reality usually one or two companies in a fund are where all the profits come from, so you can understand why investors push each company to swing for the fences.

Key takeaway for entrepreneurs is just to know when a VC is right for your business and when it's not. The key factor here is how quickly you need to scale. For example most entrepreneurs don't have the goal of a nine figure exit for their business in the next several years, but some do.

Not all VCs invest this way. Here's a good read by Greycroft Partner Ian Sigalow that walks through the economics of how they invest and why: http://www.sigalow.com/2012/01/a-new-take-on-series-a