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VC missed 5-10x returns by not forcing entrepreneurs to take exit

The Full Ratchet · Investor Stories 461: Feast and Famine in Crypto, When to...

“I wasn't able to influence the entrepreneurs to take an off ramp, and they wanted to go all the way.”

4:19 / 4:53

I wasn't able to influence the entrepreneurs to take an off ramp, and they wanted to go all the way. I supported them, but I told them the valuation we are getting. We're in a bubble. These multiples are not repeatable. It's the best performing investment of Mayfield. I think three years before that, we could have made another five to 10 x and made history. It would have been the best private acquisition in 2021 in the history of venture capital.

About this clip

A Mayfield partner shares the painful lesson of watching entrepreneurs refuse to sell during a bubble, missing what could have been venture capital history. Despite recognizing unsustainable valuations and advising an exit, the investor supported the founders' decision to keep building rather than take the off-ramp.

Why this clip

This captures a universally relatable VC dilemma about when to push for exits versus supporting founder ambition, with concrete stakes that illustrate the cost of getting it wrong.

4:19 - 4:5334spersonal lesson
exit-strategybubble-valuationsfounder-investor-dynamics

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What they said next

Investor admits he'd make the same costly mistake again

4:39 - 38s · personal lesson

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