Short video commentary by Matan Hazanov responding to an article by Steph Nasser (OpenBC) arguing that venture capital is biased toward already-wealthy founders. Hazanov explains that less-wealthy founders face higher personal financial risk (no savings, family obligations, inability to take long unpaid periods), making them less attractive to VCs and supporting the claim that venture capital is "not poor friendly."
You may be too Poor to raise Venture capital There's an interesting article going around written by Steph Nasser of OpenBC that venture capital is not poor friendly. It means those that are already successful and wealthy are much more likely to raise venture capital and of course succeed as a result of that and even build more wealth. So is Steph right? Is he wrong? Is he half right? Founders that don't have wealth are taking substantially more risk which makes it much more difficult to invest in them. Think about it like this. Imagine you have no savings, you have a family, right? And you want to go and start this business. It's high risk. You can't take a salary for a very long time. If there's any hiccup in your business, you're done. VCs don't want to get into that kind of situation if they can avoid it. And so it may seem harsh but the conclusion is that venture capital is not poor friendly.
