Should a VC investor talk to an employee who quits a portfolio company after they leave?

Generally, if the issues are around:

  • harassment or any inappropriate conduct, or
  • fraud or misleading financials, etc, or
  • something else that is wrong (legally, ethically, morally, financially, etc.)

then I definitely need and want to have the meeting. I absolutely want to hear about it, immediately.

All of these things do happen, unfortunately. I wish they did not. They are horrible and destroy lives and companies. These things shouldn’t happen. And maybe even especially not in start-ups … where we are doing it to be part of something better.

But otherwise — maybe it’s better not to reach out to the investors.

In general, startups are tough. As an investor, you are backing the founders in general, and really, the CEO in particular. It’s unfortunate, but you do expect some sour grapes from some ex-employees. And more relevantly, CEOs aren’t perfect. Most of us grow as managers. I expect issues, unforced errors, challenging meetings, and mistakes. It’s a bummer, but I expect a few ex-employee who think the CEO is bad, or their boss was terrible, or the company is pointed in the wrong direction. It’s not as helpful as you’d think.

If the CEO (and later, CFO) did something wrong, I want to hear about it. Please. ASAP.

But if you disagree with management, maybe, let it go. If management isn’t doing something wrong per se, but you don’t agree with the direction or decisions, maybe let it go.

Find a better place.

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Published on February 1, 2018

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