Venture Capitalists Coddle Entrepreneurs As Royalty

> The firm, Felicis Ventures, said on Tuesday that it would always support its entrepreneurs on company matters, giving up the right to vote against them.

> “The one thing that we always say internally is our success is predicated on our founders’ success,” he said. Signing a written promise to always vote with the founders, he added, “makes a really strong statement that we will not block any sale. We will not question the management.”

If this approach is focused on ensuring that founders have the ability to sell their companies, I wonder if Felicis is also doing away with liquidation preferences.

It's one thing to agree to vote with the founders; it's another to structure your investment so that they can actually sell at any time without risk of not making any money.

> The lawyer for Felicis, Gaurav Mathur, said he was initially surprised when Mr. Senkut came to him with the idea. But he said it was consistent with the firm’s philosophy and added that it was permitted under the firm’s agreements with its limited partner investors.

I wonder if the firm's limited partners were aware of this when they became limited partners.