Angel investor Chris Sacca said he’s noticed an uptick in “posers” at PandoMonthly last night. He’s seen a sense of entitlement creep into the startup culture in Silicon Valley. There are “actual killers” like Kevin Systrom who worked tirelessly and “just slayed it,” but there is also an increasing amount of “fairweather dudes,” in the Valley, “because it’s cool, and because you can make a lot of money.”
This trend has begun to wane lately, but “there was just a real sense of fucking entitlement in the seed industry,” he said.
He praised the work of Paul Graham and Y Combinator for bringing more emphasis and control to coders in the Valley. “Guys like Paul Graham stepped up and went to the coders and said, ‘You can be the business guy, even though you are kind of a math geek.'”
It created a new generation of empowered entrepreneurs, and shifted — in a good way — which VCs were the most successful. Entrepreneurs wanted to work with someone who had real product knowledge, and those guys got the best deals.
“But along the way there was no check that really balanced out the entitlement that happened with an entire generation of entrepreneurs,” he said. He got tired of people telling him their 12-week-old companies were worth millions of dollars.
Has the backlash to Facebook’s unsavory IPO been a wake-up call to all the Zuckerberg wanna-bes out there?
Somewhat. Rationality is returning, Sacca said. Party rounds seem to be declining, and some founders are opting to take less money from smaller, more strategic groups of investors who they know will help their company, rather than raise as much as they possibly can, simply because they can. He gave the example of Gumroad, one of his portfolio companies, which took less capital from fewer investors initially. Taking checks is great but with a party round, there’s no one to keep you honest each month, he said.
[Illustration by Hallie Bateman]