My advice: avoid VC with a ten foot pole, unless the business model is so capital intensive that there is no avoiding it.

My experience with venture capital was horrendous. The terms were such that we (the founders) received no proceeds of the eventual sale unless the company sold for more than three times the VC investment. Our company sold for $16M, but the VCs had put in $10M, so we (the founders — who had the idea, launched the company to profitability without VC, and then did the hard work to grow the company) got nothing.

What a bitter pill.

Those who are fortunate enough to find themselves in the right place at the right time to launch a company that takes off generally will not find that chance a second time; so it is terrible to have that once in a lifetime chance taken away by VCs who know how to craft term sheets and sell you on the idea of taking their money with terrible strings attached — like loan sharks.

Plus, VCs don’t like it when you experiment. But nowadays, startups often have to pivot as they start to test ideas in the market. But if you pivot too much, the VCs get nervous and will likely force a sale — and you will end up with nothing.

If you do go down the VC road, read the terms very carefully. Do not accept terms that create a special class of stock that give the VCs priority in any proceeds from a sale or merger. Instead, it should be a partnership, where you all either win together or all lose together — no one should be getting “house odds”.