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Is this behaviour by VCs very common in Indian startup ecosystem? Have heard of more such stories from founder friends

Project Manager

Is this behaviour by VCs very common in Indian startup ecosystem? Have heard of more such stories from founder friends- Grapevine

Image source: https://twitter.com/f6ary/status/1712505898688528719 

I used to work with one and always thought he was like this wanted to know if anyone had any experiences like below with them here?

Anyone had any experiences like this with VCs in india?

Software Engineer

Know a cousin who is a founder. Tells me with experience that VCs in India only operate in FOMO. Unless you tell them another VC is looking to invest in you, they will NEVER invest in you. 

They need fomo to operate 

Only exception is ex CXO founders (high profile), where they know they'll get funded so it's fastest fingers first!!

People should call this out more. What are examples around you where VCs have done something bad to a startup?

Growth And Strategy

I'll start - One of the older VC firms with an office in Indiranagar (also probably planning to shut their scout vehicle fund after a few employee exits) reels of toxicity at the helm. GP who comes from a rich family has the habit of arm twisting employees and putting them down even on the smallest of the mistakes. What's your toxic VC story?

Let's discuss toxic VCs

Founder’s Office

Welcome to Office Gossip's Private Community

Go ahead, ask if we pushed founders to commit fraud.

AMA: Worked at tier 2 VC - got in post a few years of workex and a tier 2 Indian uni

What stops you from *stealing* an idea that you found mind-blowing from a pitch of a startup trying to get a seed funding?

Founder

Welcome to Product Managers's Private Community

I work as a Product manager at a series A well funded startup.
This company is run by a solo founder/CEO.

This is a wannabe tech and product startup that does not care about their product at all. The internal review meetings get 5 minutes on product and 55 minutes on business and operations on a good day!

All they care about is how to run operations and tech just works on automation instead of building the product for the end user. Every OKR cycle runs for two months where OKRs are set for product but we end up building internal tools because things get "re-prioritised" and operations "can not miss targets".

The worst part is that the strategy changes every 2 months and every week, the CEO keeps adding new "wants". Almost like a baby seeing shiny new toys.
At this stage, the product has become a mess with no identity at all!

This baby always says "But is that even do-able" acts critical and tries to seem smart in front of their employees while lying to the investors and board every other week that we are a tech and product company.

I don't know if this happens at other startups in India. 

Would love to hear what y'all have experienced.

Identifying a Baby founder

You sound like a tech bro, who thinks that only tech runs the world. Huge companies like Tata, reliance etc are built on solid operations and business insights.  
  
 Tech is enabler, if the founder is smart with business and operations, most likely he will make a good business, and unless you start valuing things beyond tech also, you will keep hopping jobs and cribbing why people don’t value you.

Senior Product Manager

Is there a massive information asymmetry among VCs as well ? What is the level of fluidity in the system when it comes to information sharing ? What is the extent of damage, a few VCs opinion of a startup does to the start-ups fundraising capabilities?

What is the level of collusion among Indian VCs when it comes to passing confidential information as a gossip ?

Investment Banking Associate

I have evaluated a lot of startups as part of my work. My approach has changed from being optimistic to being suspicious of a lot of founders, even before the process starts. 

The sheer number of founders that I come across that try to game metrics/play around with data to make the startup look good. 

Most commonly:
1) Completely changing the definition of margins, repeat rates, etc. and never clarifying that they are using different definition. 
2) Often giving rebates/discounts to key stakeholders but finding ways to hide it from their P&L so that it’s not visible. THIS IS SO COMMON - lot’s of them start showing revenues, and then you will see another cost item rising at the same pace, and lot’s of times it will just be money moving around
3) Sometimes completely giving the wrong picture of how their product works on ground. You then speak with their customers, and they describe something completely else.

Things like these are eating up the ecosystem. These founders also end up fooling some VCs, and then capital get’s kept away from actually good founders who have good intentions.

There was a recent major investment in the commerce space, and that is another one such example of a startup doing this. Needs to stop.

RANT: Founders who fake metrics

Product Owner

What can be improved? Not people specific, but what you feel is wrong about us consistently across most conversations you've had?

Founders/Ex Founders on Grapevine, what can VCs get better at?

Investment Associate

Welcome to News Discussion's Private Community

ReshaMandi, a startup that raised over $40 Mn in equity funding, is facing insolvency pleas and has allegedly coerced employees to join another company, Genzr Solutions Private Limited, leaving hundreds of former employees awaiting salary dues.

- ReshaMandi's downfall was attributed to rapid expansion across various verticals, revenue inflation, and financial mismanagement, including inflated revenue, fake vendors, and loan defaults.

- ReshaMandi's founders and management personnel have joined Genzr, a seemingly unrelated company, raising questions about the acquisition and the funding received from an unrelated source.

- The failure of ReshaMandi has raised concerns about VCs investing without adequate due diligence and the accountability of investors and founders for the company's financial situation and treatment of employees.

Source: Inc42 - https://inc42.com/features/inside-the-upheaval-at-reshamandi-a-questionable-2nd-innings-after-a-40-mn-collapse/

Corporate Governance Trouble at Reshamandi 🧵

Journalist

I'm hearing some horror stories of pressure and unreasonable expectations coming from VC's even at the seed stage. Pre and post funding. 

Do you folks have stories to share about this. Especially w.r.t. interaction with associates with zero business experience giving Gyan !.

Founders on here....what's the worst VC experience that you've had ?

I know sometimes we refrain from saying too much about our company. But exes can usually be talked about, since there's not much holding back.

Maybe it helps someone else avoid a mistake you did, or gain a new learning :p 

Shoot.

What's a secret from a previous workplace you worked at? 🤫

Not my workplace, but true story. 
  
 giant american retail company (assume it's W*) hires one giant indian IT services company (assume it's H*) for some maintenance work now this H* company has offload this work to small Indian IT services company (assume it's M*) which has a employee named R* who's one assigned to actually do the work but R* is smartass he's scouting internet for freelancer to fix the issues. He gets one junior guy P* to work for few thousand rupees and shares his credentials, vpn provider etc and our P* now messes up , in the whole scenario there's no safety lot's of mess total grey zone. 
  
 From knowing this incident, I'm like no one gives any fucks about anything, only if people weren't so bad.

Backend Engineer

Corporate Strategist

I met one of my college friends yesterday at a bar. She got married last year and was laying down the struggle of finding a new job. 

Now, apparently in many interviews when she reached the final few rounds, the HR or the Hiring Manager enquires about marital status and whether she has any children. 

When she mentions that she recently got married and that she does not have any kids, the company stops responding to her. 

She elaborated that although they might have found another fit for the role but she is a T-1 grad who did her Masters from an Ivy League college and has worked for 4-5 years in both NA+EMEA and India.

It is becoming more apparent to her that, HRs and Hiring Managers have a strong bias because they are definitely presuming that since she recently got married and will likely have a child soon, that she will use up her maternity privileges leading to significant productivity drop. Meaning, that the company will likely have to hire someone else to make up for productivity loss.

She does not plan to have kids for another 3-4 years but getting married is proving really hard for her. 
Especially in the Series B+ startups that she is applying to.

[Thread] Have you ever witnessed someone get discriminated against at work? Why do you think happened?

All these issues root from this being an employer market. We won’t see this as much in good times.

Product Manager

Recently met a few VCs. Why are so many of them so stuck up and have entitlement issues

Went for pitching my startup with my cofounder and found him openly flirting and trying to be friendly.  Have you guys faced this? Isn’t this blatant abuse of power? Wondering if I should name the firm but scared.

Delhi based partner at top 10 VC firm WOMENIZER

Business Development Manager

Asking this on behalf of many founders like myself, wanted to collate across multiple inputs: what is it that VCs really want to hear/see from a startup? 

Would love to get inputs from VCs and other founders alike - basis your experience on what has worked what hasn't worked.

The usual suspects: obviously the founder credentials, TAM, insights, metrics. But, what else? 
Look forward to informed answers.

What do VCs really look for in startups? How do they evaluate?

The startup is Accel and Elevation backed. 

The company raised seed funding because the founder and team is from IIT- Kharagpur, and Accel + Elevation have people from IIT-Kharagpur working in their team. 

The founder has no prior work experience, no manners on how to speak with anyone (office boy, or women employees) keeps firing people who don’t agree with him, insists on being in the office for 12 hours because he pays us. 

Hiring criteria is -
1. Single people, so no distraction. He asks are you single or in a relationship (in the interview)
2. No married people 
3. Hire women only if they can stay in office till 5 AM (US based startup)
4. Everyone has to be in office for 12 hours compulsory for all 6 days of week

He boasts on how the VCs will save his ass even if the product fails, has said that worst case scenario I will make money because I know company will be acquired. 

He hires domain experts, makes them create playbook and train juniors to do the work, and then fires them saying "We have to stay lean, and this is a bad market". He did this with 3 departments already. 

How are the VCs not asking him basic due diligence questions? He is now raising 8 million follow up round.

RANT.

This is grapevine for godsake. Name the damn startup.

Recruiter

I am starting up soon. I care about working on meaningful problems, with good people and building the right culture. 

Have been hearing from a lot of folks about culture problems in startups. Seems more of a norm rather than an exception. 

Curious to know why do startup culture degrade? What pitfalls should I avoid to create a healthy culture?

Why do startup culture go bad?

Product Marketing Manager

I was speaking to an ex-colleague and he mentioned how my previous employer, a lending startup, has been intentionally over-reporting disbursal numbers and under-reporting delinquencies in portfolio.

They conveniently chuck the NBFC partners who dare to ask questions and instead catch new fish. During my time I saw sales staff committing rampant frauds and making money on the sides from users. The founders conveniently turned a blind eye till there was new business coming in. They've seemingly moved on to the next level now.

The founders have top pedigree and already come from well off families. Makes me wonder how many such skeletons are buried across startups and what leads to such behaviour. Especially in the wake of what we saw with GoMechanic, Zilingo etc.

Frauds at startups

Business Operations

Second meeting with the guy, thought his outlook might improve because we had better numbers than the first meeting (few months ago). Didn't even remember the first conversation, or our business, didn't do any research on our startup or industry before the meeting. Kept forcing opinions on me instead of listening, same as the first meeting.

Extremely rude and a waste of time. He said many things no founder should say, that too for another founder.

(Pitching is difficult as is, rejection is common and it's very easy to get demotivated)

When I said I'll share my experience with other founders and startups so they don't engage with that platform, got a reply saying they'll send me a defamation notice if I do, and will also tell other investors in the community that we are doing this startup as a "hobby" and no investor will come onboard.

It's amazing to see the kind of arrogance some people have, especially in the investor and VC network. Would have loved to name and shame him but I have better things to do than to get into petty court cases with assholes. 

Fellow founders, please be very careful and choosy with who you talk to about your startup's fundraise. Indian VC ecosystem is mostly a circlejerk and a shitshow. You're better off raising from friends and family and even individual angel investors than trying to bargain with devils in disguise.

I will most likely stop pitching for investment altogether and focus on growing my profitability than waste time convincing idiots who'd rather throw money on pitch decks without an MVP and startups without PMF, revenue or profitability.

/endrant

Defamation notice threat: Pitching in India

Fuck the defamation notice. Don’t take shit from anyone, if someone crosses their line, reply to them then and there, so that you never think about that again. 
  
 VC and angel market is big in India now. No one has full control of the full ecosystem.  
 This is not Bollywood and there is not Salman khan and Karan Johar. 
  
 Here even fraudsters are getting second chance. Keep building.

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