Recently, the health food store in my home town announced that it will close. Vitamins, alas, have been slow movers during the Great Recession.
As an entrepreneur, I generally pay attention to such for-whom-the-bell-tolls moments, but in this case, it hit especially close to home. My parents, both health nuts, had befriended the owner and learned that he will soon lose his house, which he had mortgaged to open the business.
Fellow Silicon Valley entrepreneurs, let this be a reminder: While there are many flaws in our world of angel investors and venture capitalists, we are very fortunate overall.
On Main Street, even seasoned professionals must sign deals with the devil to get six-figure loans. When their ventures fail, banks unflinchingly extract their pound of flesh from the founders. On Sand Hill road, we have somehow come to see cliffs in founders’ vesting schedules as atrocities.
Stik.com is young, and I fully expect to publish some critiques of the venture industry as we accumulate more experience, but I vow, now and publicly, to remember: while VCs sometimes use tough terms to juice returns, I have never heard of a VC-backed founder who lost his home on the way to the deadpool.