I agree that "bad marriages" between investors and founders in illiquid private companies can be a serious problem. But I don't really see how any of the points made about the post-pandemic fundraising environment create a bigger risk.
* Shift from in-person to virtual fundraising
Why would this make any significant difference in terms of creating a bad match? It's not like investors and founders are literally spouses. Most of their working relationship is virtual anyway. Status updates over email, strategy discussions over calls, back and forth revisions on roadmaps. If anything in-person fundraising would probably create more bad pairs, as founders can be dazzled by opulent offices and investors can be be fooled by charismatic presenters.
* Reduction in process from weeks to months
Most of that month-long fundraising process isn't a getting to know you courtship. It's long, arduous due diligence. Maybe cutting this down increases the risk of fraud or negligence, but personality mismatch seems unlikely. If anything compressing the process to weeks creates less of a sunk-cost pressure to push the deal forward despite incompatibilities.
* Increased in early stage capital
More capital sloshing around means founders have more options, and therefore are more likely to be able to pick a VC that they feel compatible with. Of course, you can make the point that the opposite is true going the other way. Investors are more likely to rush into bed with a founder they're lukewarm about. But historically, and even in this capital rich environment, the balance of power tilts in favor of VCs. At least for seed stage companies. Equalizing power dynamics most likely contributes to better long-term matches.
Just to clarify. A investor - > founder relationship can be very stressful. One side holds the money and lifeblood of your company over your head. And the other side holds the money and investment hostage to operating practices and reality.
For investors this may be extreme stress they can't just bow out of.
So yes, not literally a marriage but extreme stress is still extreme stress.
* Shift from in-person to virtual fundraising
Why would this make any significant difference in terms of creating a bad match? It's not like investors and founders are literally spouses. Most of their working relationship is virtual anyway. Status updates over email, strategy discussions over calls, back and forth revisions on roadmaps. If anything in-person fundraising would probably create more bad pairs, as founders can be dazzled by opulent offices and investors can be be fooled by charismatic presenters.
* Reduction in process from weeks to months
Most of that month-long fundraising process isn't a getting to know you courtship. It's long, arduous due diligence. Maybe cutting this down increases the risk of fraud or negligence, but personality mismatch seems unlikely. If anything compressing the process to weeks creates less of a sunk-cost pressure to push the deal forward despite incompatibilities.
* Increased in early stage capital
More capital sloshing around means founders have more options, and therefore are more likely to be able to pick a VC that they feel compatible with. Of course, you can make the point that the opposite is true going the other way. Investors are more likely to rush into bed with a founder they're lukewarm about. But historically, and even in this capital rich environment, the balance of power tilts in favor of VCs. At least for seed stage companies. Equalizing power dynamics most likely contributes to better long-term matches.