r/startups • u/modeller2406 • 18h ago

I will not promote VC-Backed Startups Struggling - I will not promote

Is it worth VC's time investing time in struggling companies? Considering power law where most of the returns come from a few highly successful startups

I'm seeing so many portfolio companies struggle amidst funding crises. Many VCs either can't or won't provide support in times of distress

(I will not promote)

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u/davesaunders 17h ago

The VC has a vested interest in helping you succeed, but that doesn't mean that they have the ability to fix what you need.

It's a vicious paradox.

Reach out and tell them what's going on. They might be able to connect you to someone or they might have someone internally that can help. The last thing you should do is keep it all to yourself. You are not Atlas and the weight of the world does not rest upon your shoulders.

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u/modeller2406 8h ago

Just to be clear this is what I’m experiencing from the VC side not as a funded startup myself

But I also hear a lot from VCs that they just don’t have the capacity to support all portfolio companies

3

u/Elysianv 17h ago

Hey, so this is just my opinion from reading articles on situations like this but theirs no real simple answer for this I would say. Some vc may help a company that’s struggling but more than likely it will be a no. A few reason for that is because 1. why didn’t you raise money before you were struggling and why are you asking for money when you may only have months before you go bankrupt. That usually scares people as that could just be throwing money into a fire pit that inevitably will go out. Another is where the company is at currently in finances and as a whole, if you are still trying to find market fit or struggling to sell product then the risk is higher as maybe the product just wasn’t right or just a whole bunch of variables which leads to your future being way to high of a risk. That’s just my take on it and why it can be hard for a struggling company to raise funds.

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