Does being rejected by many VCs signal anything meaningful about a founder's ultimate potential?

Paul Graham · published Aug 2013

Even a case as strong as Microsoft's won't always convince investors; many VCs would have rejected Microsoft and some did reject Google.

source How to Convince Investors

Paul Graham · published Aug 2013

Fundraising is not hierarchical like college admissions: because the best investors are much smarter than the rest and the best ideas initially look bad, it's common for a startup to be rejected by every VC except the best ones.

Dropbox was seen first by all the Boston investors, who were few and timid and passed on it as 'yet another backup and syncing thing', and weeks later raised a series A from Sequoia.

source How to Convince Investors

Markus Villig · published Nov 13, 2024

European VCs rejected Bolt on the grounds that they didn't believe in the ride-hailing category and expected Bolt to be wiped out, despite praising the team and metrics

Scope: across dozens to ~100 meetings, every major firm said no

42:48 20VC: Bolt; The Most Insane Story in Startups | Turning a $5K Loan into an $8BN Company | Why Every VC Turned Down One of Europe's Biggest Winners | Competing with Uber & The Future of Micromobility and Self-Driving

Harry Stebbings · published Mar 28, 2025

Investor demand is not a signal of founder quality — many of the greatest founders were passed on by dozens of VCs

Founders of UiPath, Klaviyo and Shopify's Toby all describe being rejected by ~50 VCs

59:45 20VC: Why Traditional VC is Broken: How VCs Learned Nothing from 2021 | Why LPs are More Important than Founders & Advice to Emerging Managers | Bull Case for Bytedance & Why TikTok's Ban Doesn't Matter with Mitchell Green, Lead Edge Capital

Paul Graham · published Aug 2013

No company, however successful it later becomes, ever looks better than a pretty good bet a few months in — Microsoft included.

Microsoft's success depended on the unforeseeable size of the microcomputer wave plus good execution and luck; it was by no means obvious a few months in.

source How to Convince Investors

Paul Graham · published Aug 2013

If a present-day equivalent of the three-month-old Microsoft presented at a Demo Day, some investors would turn them down.

source How to Convince Investors

Mitchell Green · published Mar 28, 2025

Rejected-founder success stories don't generalize: for every Toby at Shopify there are a hundred thousand founders who aren't going to make it

60:03 Rejection success stories are survivorship bias most rejected founders fail