“1) VC money is not evil. 2) VC money is not sustainable.
Those are not contradictory statements.”
Those are Rafat Ali’s words from a post he wrote Friday in reaction to the cascade of bad news for a bunch of venture-backed new media companies. While Rafat’s expertise is concentrated in media (he started and sold Paid Content and now runs vertical travel startups Skift), the statements above apply generally (we’re investors in theSkimm and Cheddar, so clearly believe there is a place for venture here).
The most challenging aspect of taking venture capital is that it’s difficult to step off of the venture train once you’ve taken too much money, or negotiated too high a valuation, or gone too deep on executing a plan that requires high burn ahead of profitability. But complaining about that or assuming it’s fundamentally “evil,” is like getting married and then complaining it makes dating other people difficult. You knew what the ring meant when you put it on.
Side note: I generally enjoy Rafat’s perspectives on media, technology and culture. Here’s a 2016 podcast he did with Recode’s Peter Kafka that’s worth a listen.