A very interesting short conversation with Bijan Sabet (@bijan), General Partner, Sparkcapital about the changing workings of VCs with startups (for the better) in the US. He led investments in Twitter, Tumblr.
- VCs need to improve their image with entrepreneurs
- SparkCapital was the first in the industry to waive the requirement that startups pay a VC’s legal fees after a funding round closes. This made him and SparkCapital unpopular.
- Spark stopped mandating non-compete clauses for founders and their employees as far back as 2008. In California non-competes are unenforceable, and thus largely non-existent in agreements.
- VCs aren’t demanding as large stakes in the companies and are less insistent on board seats.
Such terms are so encouraging to an entrepreneur and the entire startup eco-system.