78% of the 7,500 CEO Members of TheFunded have closed a financing for their current business.

A small number of frustrated venture capitalists have propagated a fallacy to the media that (a) unfunded CEOs (b) use their limited spare time while running a business and raising capital to (c) write vengeful reviews of a person that they spent 45 minutes to 1 hour with. Besides the fact that this argument seems illogical, it is not supported by the data, either.

Here is the reality. First, the majority of reviews are driven extreme experiences, either good or bad. A mediocre venture firm or venture capitalist does not get reviewed often, if at all. Second, the next most common set of reviews are coerced by the venture capitalists themselves, such as this public comment where the CEO checked that the fund requested the review: “My experience with XXX is that he asks more questions during a meeting than other VCs, really listens to your answer about as often as other VCs and figures things out pretty quickly. Some of the things he figures out are actually correct.” As you can read, there is a hint of skepticism in the praise.

The least frequent review is the jilted entrepreneur seeking revenge. Less than 0.05% of the 11,500 reviews fall into this category, and they are pretty easy to spot, such as this title: “Possibly The Worst Vc That Ever Existed.”

Unfortunately for the entrepreneur community, there is no other good experiential data source on venture capital. Most journalists are afraid of libel suits, and most entrepreneurs are afraid of speaking on the record. Constructive criticism on how to make TheFunded.com better is 100% welcomed.

Not really. It’s not just time, you want to pitch VC’s who have a high chance of success, because as soon as you pitch someone else, all your best ideas are going to be public domain.

For example, if a VC regularly cuts off people in the middle of a presentation, then you know you haven’t done something to make someone particularly mad .

But if respectful VC (who’d I’d pitch just because I’d enjoy it and I like enjoying life) cut me off, I’d ask him with concern – have I done something to offend?

Anyways, a part of me wonders if Mike actually has a bias against the Funded because they have a deal with their competitors, Venture Beat.

I use reviews of doctors, plumbers, ebay sellers, everything. If you learn to read between the lines, you can generally find a good fit. For example, a review that doesn’t go pro or con, but talks about a certain vc’s strengths and weaknesses (good on marketing, bad on tech, good on strategy, bad on bringing in a good ceo, etc) … you’ve hit pay dirt.

The same goes for reviews of doctors (good with children, bad with men’s ailments, etc) ..

These “gripe sites” are extremely valuable. They are ’structured gossip’ which is the only kind of valuable gossip. Nobody wants to waste time, VC or entrepeneur, and information is critical for that.

One thing I think all VC should do, though, is give good feedback. Unless they are a high brand, I’d hate the idea of pitching a VC that doesn’t give good feedback.

The thing you have the least of as a founder is time and TheFunded gives you a bit a leg up – as minor as it may be.

Plus the other resources on the site – deal terms, forums, etc. are excellent.

A VC told a company who had just started requesting meetings but hadn’t had any pitches yet once “we heard about you from another [VC] firm.” Entrepreneur thought this was a good thing. VC went on with the admonishment “VCs want to feel they’re special. Since you’re ‘out there’ you’re tainted goods, means to us that no one is biting.” Yet the process is so time consuming, to say entrepreneurs should focus on their companies is easy to say when trying to get meetings etc. is a super-time consuming process, so who wins here. because of the in-breeding, I would venture to say that something in the process is broken.

Totally agree that deal terms are usually most important things to focus on. The brand of the VC has superficial value in most cases. It sometimes helps with early recruiting of key employees if and only if the founders are good at spinning the value. If they are not then the value is pretty meaningless.

the funded has obviously biased / skewed data, but it might still be relevant.

“best-branded VC”? maybe, assuming the term sheet & liquidation preferences are equivalent to the deal you’d get from a “less-branded” VC. except you probably won’t. so there’s typically a tradeoff there somewhere.

brand is relevant too, but may matter less than deal terms.

Re: #24 — Mr. Glassington!

yeah, this guy’s reputation is clearly in a freefall. Time will tell how it effects traffic to the site.

I’m always a little surprised when entrepreneurs go for the best terms or the biggest brand without even thinking about whether the person who will be on their board is someone they can work with and talk to about what’s really going on. Usually it’s because the entrepreneur thinks he or she already knows everything and just needs the $ and attention, which is sometimes true I guess — but not always. Glenn at Redfin

Personally I do not want to “push any buttons”. I thought it was incredible we got 60 minutes, and excellent feedback was provided. If we are a good investment, then I’m expecting things will work out — naive perhaps, but I sort of agree its ultimately about (product) * (opportunity to talk about it). I was afraid we’d never get the latter — very tough unless you have contacts. But we are getting a fair chance now. Input appreciated, and apologies that I’m not divulging contact info, but that’s not appropriate I think.

People who live in glass houses, Mr. Glassington, don’t throw rocks!

Dont’ expect an apology when they end the meeting by shouting, “enough! I heard about you – you’re the tow truck guy”, and then shoo you away with a backward wave of the hand.

And, don’t expect an, (i’m sorry, let me pay for damage, when they back into your Apirlia 500 Italian scooter in their parking area with their Mercedes SUV, and try to run away when you come upon the scene.

In the VC game you will get to an exit if you are lucky in 4-6 years when you have +/- 10% of your company, and you will get your $15m on a $150m exit.

With some companies you can get to the same exit without VCs in less time and less risk, e.g. Internet companies.

Want to read some real stories go to http://www.thefoundersbook.com

I would suggest remove this post, it puts the hard working entrepreneurs in the bad light.

To say if your VC is an asshole doesn’t matter is just not true. Remember, entrepreneur’s build companies and all capital is well equally green. As I know Motwani has said, no VC can make your company but a bad one will ruin it every time. A bad one will almost certainly ruin your return as an entrepreneur even when they make themselves a return.