Vinod Khosla, an early investor in OpenAI and the founder of Khosla Ventures, shared his views on what startup founders should expect from investors, criticizing the “founder-friendly” culture in the Silicon Valley.
What Happened: In a conversation on the Minus One podcast posted on Wednesday, Khosla said that while the term “founder-friendly” is often used in venture capital circles, it doesn't truly benefit entrepreneurs in the long run.
"I hate the culture — there’s a number of firms in the valley who push the idea we are founder friendly," he stated in response to a question about what founders should look for in investors. "What [it] really means, they're never going to challenge you. They want to be popular with you as opposed to help you."
Khosla, who has been investing in startups for over 40 years, described his role as a “venture assistant,” not a traditional venture capitalist. He argued that successful investors don't just write checks but provide invaluable guidance, especially when a startup is incomplete in certain aspects.
"Great founders, the majority of the time, are incomplete in some dimension," he stated, adding, "Your job as an investor is to help them with that."
He also touched on the importance of “brutally honest” feedback, saying that 95% of the feedback founders get from investors is often “hypocritical politeness” that feels good but doesn't help their growth.
Founders should strive for a real, well-intended critique of their strategy, something that challenges them to think, he said.
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Why It Matters: As the founder of Khosla Ventures, Khosla has been instrumental in backing experimental technologies such as biomedicine, robotics, and AI. Notably, he was one of the early investors in OpenAI and invested $50 million in the parent company of ChatGPT.
Khosla is also known for his involvement in Sun Microsystems, which he co-founded in 1982. The company was later acquired by Oracle. Khosla's work at Kleiner Perkins, before founding his own venture fund, further cemented his reputation as a visionary investor in technology.
With a reported net worth of $7.7 billion, according to Forbes, Khosla has built a career based on taking calculated risks in areas that other investors often overlook. His firm, Khosla Ventures, has backed major successes like Affirm and DoorDash.
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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
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