VCs Lack Founder Control

Shaan Puri shares his perspective on the relationship dynamics between VCs and founders, emphasizing that founders maintain more control than commonly perceived, even after taking VC money.

• VCs Have Limited Control:

  • They can give strong advice but can't force decisions
  • Can't fire founders without explicit power to do so
  • Founders can choose to never raise again after initial round

• Founder Autonomy:

  • Can grow at their preferred pace
  • Can reject VC suggestions
  • Must be willing to stand firm: "shut the fuck up and stay in the back seat"

• Misconceptions About VC Backing:

  • People think "VC means you're VC forever"
  • Belief that you're stuck in an "endless chase"
  • Assumption that VCs dictate growth pace

• Reality of VC Relationships:

  • More flexible than commonly perceived
  • One round doesn't lock you into future rounds
  • Founders maintain decision-making power if they choose to exercise it

• Key Advice for Founders:

  • Raising money is not the goal
  • Focus on business outcomes first
  • Only raise when lack of capital is truly limiting growth
  • Don't use fundraising as "your excuse to go do the business"