During my morning LinkedIn scroll, I came across yet another post from a venture firm celebrating a massive return multiple from a secondary transaction. The usual format: impressive return metrics, enthusiastic self-congratulation, and an almost afterthought mention of the founders who made it all possible.
As someone who's been both a founder and worked alongside VCs, these posts hit differently depending on which hat I'm wearing that day. And I suspect I'm not alone.
The Disconnect in the Celebration
Let's acknowledge an uncomfortable truth: what represents a victory lap for investors can feel jarringly tone-deaf to founders still in the trenches.
When a VC broadcasts that they've achieved "fund-returning" multiples through a secondary sale while the founders and employees remain fully locked in the fight, it creates a fundamental asymmetry that's worth examining:
- The Timing Mismatch: VCs realize gains years before founders can often access meaningful liquidity
- The Risk Differential: Investors have distributed their risk across a portfolio; founders have concentrated their entire professional risk in one venture
- The Emotional Disconnect: Celebrating financial returns while the company's ultimate success remains uncertain
The post that inspired this reflection hit all these notes - celebrating extraordinary returns from a partial secondary sale while the founders presumably continue facing the daily existential pressure of building their company.
Why This Matters: Beyond the Optics
This isn't merely about social media etiquette. It speaks to a deeper misalignment in how we communicate value and success in the startup ecosystem:
For Founders Reading These Posts:
- Psychological Impact: There's something uniquely challenging about watching others celebrate financial wins from your creation while you remain years away from potential liquidity
- Trust Erosion: It raises questions about whether investors are truly aligned for the long-term mission or primarily focused on early exit opportunities
- Cultural Signaling: These celebrations can suggest that financial engineering trumps company building in the hierarchy of venture achievements
For VCs Considering How They Communicate:
- Relationship Dynamics: How you frame your wins signals your values to both current and future founders
- Reputation Building: The venture ecosystem has a long memory - how you celebrate today shapes who will want to work with you tomorrow
- Authentic Alignment: If you genuinely believe your success derives from founder success, your communications should reflect this fundamental truth
A Personal Reflection
I've sat in board meetings where secondary transactions were being discussed. The energy in the room shifts palpably when investors start focusing on their own liquidity timeline while founders are still years from the finish line.
In one particularly telling moment, I watched a founder's expression change as an investor enthusiastically calculated their return multiple from a proposed secondary arrangement - right in front of the person who had sacrificed five years of their life to build the company. The founder later confided they felt like their life's work had been reduced to a spreadsheet cell.
That image has stayed with me.
Finding Better Balance
This isn't to suggest VCs shouldn't celebrate wins or share their success stories. Returns matter - they're how the venture model functions and how more capital flows to entrepreneurs. But there are ways to approach these communications with greater empathy and awareness:
For Investors:
- Center the Founders: Make the entrepreneurial achievement the headline, not your returns
- Acknowledge the Journey: Recognize explicitly that your liquidity comes while founders remain committed for the long haul
- Add Value Context: Share how your returns will translate to supporting more entrepreneurs or strengthener your ability to help portfolio companies
- Consider Private Celebrations: Some wins are best shared with LPs rather than broadcast publicly
- Offer Substantive Founder Credit: Beyond the perfunctory "thanks to the amazing founders," detail specifically what made their execution remarkable
For Founders:
- Set Communication Expectations: Have transparent conversations with investors about how exits and liquidity events will be publicly discussed
- Build Relationships with Empathetic VCs: The best investors innately understand these dynamics
- Create Your Own Narrative: Don't cede control of your company's story to financial stakeholders
- Seek Balanced Perspectives: Find advisors who understand both sides of the investor-founder relationship
The Emotional Economics of Venture
Behind the transactions, term sheets, and capital allocations lies a fundamentally human relationship between investors and founders. This relationship requires maintaining emotional equity alongside financial equity.
When VCs claim to be "founder-friendly," part of that promise should include recognizing the psychological impact of celebrating early returns while founders remain fully exposed to ongoing risk and uncertainty.
Similarly, founders benefit from understanding that VCs have fiduciary responsibilities to their own investors and that communicating returns is part of that obligation.
Toward a More Thoughtful Ecosystem
The best venture relationships aren't just transactional - they're transformational for both parties. They're built on mutual respect, aligned incentives, and emotional intelligence about what different milestones mean to each stakeholder.
In a market where secondary transactions are increasingly common as companies stay private longer, we need more thoughtful conversations about how we celebrate these interim liquidity events.
For VCs: Consider how your celebration posts read to the founders still building the company that delivered your returns.
For founders: Choose investors whose communications consistently demonstrate they value company building over financial engineering.
Perhaps then we can build an ecosystem where celebrations genuinely feel mutual rather than misaligned, where secondary transactions are recognized for what they are - interim milestones in service of building enduring companies, not ends unto themselves.
Because at day's end, the most meaningful victories in venture capital aren't measured in return multiples alone, but in the enduring companies and relationships we build along the way.