I'd just like to relate my experience with VC's and startups.

I worked at a non-silicon-valley startup in the 1990's. After a couple of years of growth and success, a new investor came in, and bought the company; supposedly to "prepare" us for an IPO. (we all had stock options). I think this was around 1995.

The new investment group removed the team of founders, (all engineers), to a role running the engineering team, and they hired "A professional" CEO to replace them, in the role of business management. He was actually a pretty good guy and seemed to really be dedicated to helping our team grow and succeed.

Lo and behold, about 3 months later, they announced a "merger". Lots of "synergy" with the new company; which was smaller, but wanting to build a major player in our market. They were based in Scotts Valley; so now, we were a Silicon Valley startup. Our CEO was then sort of "demoted" to being the site-manager.

The next thing that happened, was that our "parent" company bought our largest competitor. There was more gung-ho pep talk about how our products had no overlap, and that it would be a vertical integration, and we had so much work to do that there would be no layoffs.

Business deals, changes, rebranding initiatives flew hot and heavy for the next few months. Our CEO was sent on a 2 week trip to China, to work on a reseller agreement. He left on a Friday.

On Monday morning, we were all just reading our emails, and getting our coffee, preparing to start the day. Outside the window, looking at the parking lot, there was a row of 6 men, walking out of their rental cars, towards our building. They were recognized by some of our team, as high-level managers from the "parent" company. They strode across the parking lot looking like gangsters on their way to a hit.

Shortly after they came in, the email was sent. It said that there would be a meeting, and if your name was on list A, to go to one conference room, and if your name was on list B, to go to a different conference room.

I was in the "lucky" group: There was a stack of 2" thick manila envelopes on the table. Basically, our buy-out offers, which included a deal to agree to stay-on for 6 months, and wind-down operations at this site. That was about 10% of us. The rest were laid off and told to go home. Additionally, the key staff who were asked to stay, were offered relocation packages. I took mine. Which turned out really nice for me: because the new location ended up being a much better job market, and a boost to my career (eventually), and also, I got to hold on to my options until they were actually worth something, compared to the "unlucky" ones who were just offered a pittance for their shares. I wasn't happy or proud to have had to keep working with these people, but it did actually work out for me.

Probably the worst part was how arrogant and dismissive this group of men were, to our team. Frankly, they were dicks, as they laid off tech workers, in a region where there really wasn't a strong tech industry.

Later, we found that the CEO had been sent on a completely bogus trip. There was no deal. They just wanted him out of the way, so that the deal could be done while he was on a 14 hour flight.

He could have objected, but by the time that would have had any effect, the damage (to our engineering team) had been done. Some of the key players were on the phone and had new jobs by the end of the day on Monday. The ones who were laid off, had signed agreements. There was just no way the deal could have been reversed had the executive staff at our site objected, and the ones who could have objected, were bought-off.

And that's my account of how VC's work.

The product we had made was, indeed, continued, under management of our competitor. They never went public; they were later bought by another company, and our options were converted to their stock. A few years later, they were bought by another company, in a similarly stinky deal, involving blackmail of a board member. (he had some skeletons in his closet, and when they outed him, they really fucked him over HARD).

That's when I left. And decided I hated working in the private sector.