Done right, the risk is all relative.
But what tends to happen sometime around the Series B or around a $25m+ check is the partner writing the check often sort of can’t afford to lose it. This may put a new type of pressure on you. If the VC partner is senior and has a bunch of wins, she can probably afford to lose $25m. If you are up $500m, losing a $25m chip hurts, but it’s OK. But if it’s his first deal or an early one, he may have career risk if he loses it all.
By contrast, losing $250k on a seed deal again is a bummer, but generally doesn’t impact a fund much. Seed stage investments are designed to incorporate a fairly high loss ratio.
