We really, really need to talk about venture capital. Because it’s not “venture capital” anymore.
There’s a huge disconnect between what most people think of VC, where an investor has a big fund and cuts checks to help a founder build a company, and the current reality, where a handful of billionaire extremists use the cover of “VC” to advance an outrageous agenda where they’re accountable to no one.
I’m gonna explain this from a standpoint that almost never gets articulated: I’ve personally raised tens of millions of dollars in venture capital funding as CEO of startups, and been directly involved as a board member or advisor in raising hundreds of millions more. I’ve sat in board rooms, across the table from the people I’m talking about here, or been at the industry events that they frequent. So this isn’t sour grapes because these VCs wouldn’t cut me a check, or some chip on my shoulder about these investors due to a business deal. This is what I know about these bad actors because I’m part of the community of creators and inventors who build the things that they used to invest in — back when they still cared about innovation.
Many of the trends in society and politics that people are most angry about, from data centers being forced down everyone’s throats, to all of our favorite apps and services being enshittified, to politicians being paid to ignore the will of the people, are all being supercharged by these cancer capitalists. They have warped the structure of venture capital into a form of oligarchy that answers to no market, no regulators, and no voters. So it’s worth understanding exactly how they did it.
Yeah, but it’s nothing new. VCs have been used for nefarious purposes for ages. For example, there are documentaries about how they’re often used by competing companies to buy up a company that’s foundering (sometimes due to the actions of said competitors), split off a few valuable assets to give to the competing company, and dump the rest onto taxpayers to deal with in bankruptcy.
So, sure, these are another example of how the VC process is being used nefariously against the original purpose of such organizations, but they aren’t small exceptions to the rule. The system was always designed to do these nefarious things under the guise of “investment”. Without an overhaul so that these organizations are legally required to show how they use their money so that both investors and the public are able to see it, it’s not corruption of a process, it’s standard use of a process designed, in part, to mask corruption.
I started a biotech in 2016, once VC got involved with their CEO, it became a massive grift that I called out and was subsequently divested. By 2022, the company sold to pharma for $154M, by 2026, the entire project was worthless. VC and CEO made about $148M.
