[btilly]

My guess as to the dynamic is this. If a VC knows that SOME other VC is interested in you, they can't feel out other VCs to see who it is because it might get a third VC involved.

But if one VC knows who the other VC is, then collusion is simple and clearly in the VC's best interest.

[crapshoot101]

No, again it isn't. If you are looking to raise $1M on a $3M pre and you're talking to two firms seriously with the idea of picking one investor (who would end up with 25% in that scenario), you might negotiate some of that point, but its pretty unlikely you will end up taking 1 on 1 ( with the investors each putting in $500K, which would get them to that same 25% ownership threshold as in the original scenario).