The Venture Industrial Complex Is Breaking Good Companies
Let’s start with a fair statement. Venture capital has funded some of the most important companies of the last fifty years. Many investors we know are thoughtful, generous, and genuinely in the corner of the founders they back.
But the system around venture, the incentives, the narratives, the norms that get passed from accelerator to accelerator and podcast to podcast, all of that is hurting a lot of founders. Some parts of it are actively lowering their odds of success.
Three patterns worry us most.
1. Not every company is a rocket ship
Venture math depends on outliers. A fund needs a small number of companies to return the entire fund, which means investors are structurally looking for rocket ships: companies that can go vertical, fast, and become enormous.
That’s a rational strategy for a fund. It’s a dangerous default for a founder.
Most good companies are airplanes. They fly. They carry real customers to real destinations. They can be profitable, durable and life-changing for the people who build them. A $20M or $50M exit can change a founder’s life forever, and plenty of companies that never “exit” become great businesses that pay their founders well for decades.
The problem starts when a founder with a perfectly good airplane gets told the only acceptable outcome is a rocket. So they bolt on rocket engines. They raise more than the business can absorb. They hire ahead of demand. They chase rates the market can’t support. They try to run a marathon at their 5K pace. And the airplane, which was flying just fine, often comes apart in mid-air.
We’ve watched it happen. Companies with real revenue and loyal customers burned through capital chasing a trajectory that was never theirs, and ended up worse off than if they’d never raised the round. More specifically, the problem was they internalized the perspective of their most aggressive investors.
2. 9-9-6 is a burnout machine
There’s a growing glorification of extreme hours in startup culture. 9-9-6, borrowed from parts of the Chinese tech industry, means working 9am to 9pm, six days a week. We’ve even heard founders brag about 7-10-7: 7am to 10pm, seven days a week.
Founders work hard. That’s part of the job, and there are seasons when the hours have to stretch. But treating 72-plus hour weeks as a permanent operating standard is a bet against how humans actually work biologically.
Decision quality drops when people are exhausted. Judgment gets cloudy. Relationships at home erode. Teams copy the founder’s pace and burn out right behind them. And the costs compound quietly, until a founder hits a wall they didn’t see coming.
The founders we see build lasting companies treat their energy like a strategic resource. They protect sleep. They protect relationships. They build rhythms that let them perform for ten years, not ten months. A startup is a marathon run at an uncomfortable pace. Sprinting the whole way just means you don’t finish.
3. The coaching blind spot
Here’s the one that makes the least sense to us.
Investors routinely expect founders to spend money on lawyers, accountants, recruiters, and software. Those are treated as necessary infrastructure. But spending on coaching or advisory support for the founder, especially early, is often treated as optional, indulgent, or something to consider after a problem shows up.
Think about where the risk actually lives in an early-stage company. It’s concentrated in one or two people. The founders’ judgment drives hiring, strategy, fundraising, culture, and every major decision. When that judgment is sharp, the company moves well. When it’s clouded by pressure, isolation, or inexperience, the company drifts, and nobody else in the building is positioned to catch it.
That makes the founder the single biggest point of failure in the business. And the earlier the stage, the more true that is.
Yes, we’re a coaching company, so take our bias into account. But the logic stands on its own. If you want to insure the most important asset in a company, you’ll start with the person making the big decisions. Supporting founders early, when habits are forming and mistakes are cheapest to correct, is one of the highest-leverage investments an investor can make. Instead, it’s usually one of the last.
What founders can do about it
You can’t change the venture industry on your own. You can decide which of its norms you accept.
Know what you’re building. Be honest about whether your company is a rocket or an airplane, and raise accordingly. Choose investors whose expectations match your actual business.
Build at a pace you can sustain. Hard work is required. Self-destruction is optional.
Invest in your own judgment early. Find people who have been where you’re going and can tell you the truth. Whether that’s a coach, a peer group, or seasoned advisors, don’t wait until something breaks.
The goal was never to look like a startup from the headlines. The goal is to build something real, and to still be standing when it works.