Should seed investors treat other seed firms as competitors or as collaborators?

Harry Stebbings · Nov 21, 2022 · hedged

Venture is a game of intense competition, and an investor should be upset when they lose money

The best people are hypercompetitive and hyper-curious

15:27 20VC: Semil Shah on The Biggest Mistakes VCs and LPs Made Over the Last 24 Months, Why LP Churn is Coming, Core Lessons on Scaling from $1M Haystack Fund I to Today and How To Find, Win and Manage LPs as an Emerging Manager

Kevin Hartz · Jul 22, 2024 · hedged

Venture is markedly less cooperative and more sharp-elbowed now, though this may be a reversion to the mean rather than a new state

In the eighties and nineties funds took high ownership with greater company mortality; today's trillion-dollar outcomes raise the stakes so much that funds need a very specific reason to work together

Scope: reversion-to-mean framing offered as one possibility

24:26 20VC: How I Lost Airbnb at Seed Because of an Exploding Term Sheet | Investing Lessons from Roelof Botha & Peter Thiel | Why VC is Less Collaborative Than Ever and Great Companies Are Being Destroyed by Too Much Cash with Kevin Hartz @ A*

Mark Goldberg · Oct 25, 2024

Chemistry will compete tooth and nail with every firm including the partners' former shops, and that competition is good for founders because founders should have choice

Venture is an industry where you collaborate on one deal and compete on the next; founder choice is the benefit

17:13 20VC: The Truth About Multi-Stage Firms; Why Portfolio Services are for VCs not Founders | Why Politics is Rife & Decision-Making is Broken in Large VCs | Why Reserves are Bad for Founders & How Boutique Firms Will Win with Mark Goldberg @ Chemistry

Max Altman · Nov 21, 2025

The biggest BS in venture is the claim that it is a chummy collaborative community; it is a competitive market where everyone fights over a scarce amount of good equity

In practice people elbow each other out of the way when a deal is at stake

69:54 20VC: Max Altman on The New Seed War: Can Anyone Compete with Sequoia and a16z | Leaving $2BN on the Table with Reddit | Lessons from Backing Rippling at $25M Post | Why Climate Tech is a Mirage and Disaster

Miles Grimshaw · Sep 18, 2023

Benchmark is not competitive with the seed ecosystem and venture is not zero sum; and for Benchmark there is no such thing as too early or not enough traction.

Even at that percentage the absolute number is about three companies a year against a large flow of newly formed companies

33:26 20VC: Benchmark General Partner, Miles Grimshaw on The Five Pillars of Venture Capital, Why Data Can Be a Trap When Early-Stage Investing, Investing Lessons from Missing Figma and Plaid & The New Business Model for AI & Why Co-Pilot is an Incumbent Strate

Josh Browder · May 18, 2026

Competition from other pre-seed and seed firms is helpful rather than threatening, and once basic issues are fixed a company becomes legible enough to raise an institutional seed fairly quickly

There is so much capital available, and other seed firms can join and support the companies he backs

Scope: legibility for an institutional seed, not for a unicorn round

44:03 20VC: Turning Peter Thiel's $100K into $10M Angel Portfolio | The One Man Accelerator at The Four Seasons | Why VCs Can Be Sharks and What Founders Need to Know | Why Stocks and Cash are BS and You Should Invest in Land with Josh Browder

Matt Murphy · Jul 27, 2026

Syndicating rounds with another top-tier firm is preferable to sole-investor rounds because co-investors help the entrepreneur grow and scale more effectively

That was the operating view for his first ten to fifteen years; the shift to one-investor rounds was driven by ownership targets rather than what helps founders

36:51 20VC: Leading Anthropic's First Ever Round | Will Open Source Threaten Anthropic's Business | Do Margins Matter in a World of AI | Why Triple, Triple, Double, Double is Not Good Enough Today | Why Series A is Hard Today with Matt Murphy @ Menlo

David Tisch · Feb 27, 2023

A firm should run the model it believes in rather than converge on what everyone else does, and being different from peers is not a defect

He owes results to his LPs, partners and team; other firms doing something else is fine and not something he judges

42:31 20VC: How Multi-Stage Funds Changed The Game For Seed Rounds, Why Signalling Risk is BS, The Three Most Important Variables for Founders When Raising Rounds & A Debate on Portfolio Construction: Does Ownership Matter with David Tisch

Hemant Taneja · Sep 22, 2025

A venture firm should run its own race and refuse to play venture as a zero-sum competitive game, while still learning from others

Playing your own game rather than competing against peers is what allowed GC to build what it built

Scope: learning from others is still welcome

64:35 20VC: General Catalyst CEO Hemant Taneja on The Future of Venture Capital: Chanel vs Walmart | Lessons Scaling GC to $40BN in AUM | Investing $5BN+ Into Stripe Over 14 Rounds | Investing Hundreds of Millions into Anthropic at $60BN Valuation

Frank Rotman · Aug 26, 2021

Venture should be far more collaborative than it is

In American Ninja Warrior competitors help each other because the challenge is so great that working with others beats working against each other — the same logic should apply to venture

51:49 20VC: Has Price Discipline Disappeared? Is it Possible to Build Ownership Over Time? Why Venture Is Less Collaborative Now Than Ever? How fast Do Breakout Companies Become Obvious? How To Construct an Optimised and Repeatable Investment Decision-Making Pr

Rob Go · Jun 23, 2023 · hedged

The Boston venture market underperformed the West Coast partly because of a local scarcity mindset and protective attitude

The protectiveness around relationships and information stifled the ecosystem, which is part of why they wanted to start a fund that bucked the trend

Scope: 'I would argue'; a function of that time period; he thinks many funds today don't behave that way

23:33 20VC: How to Raise a Venture Fund from Deck to First Meetings to Final Close, Why Venture is a Young Person's Game and Why Multi-Stage Funds Have Not Ruined Seed with Rob Go, Co-Founder @ Nextview

Harry Stebbings · Sep 18, 2023 · hedged

By writing the first institutional check in 50-60% of its investments, Benchmark is competitive with seed managers, unlike firms that deliberately avoid seed to stay non-competitive with seed players.

Investors like Ophelia at Blossom avoid seed precisely to remain non-competitive with seed funds

33:02 Writing first institutional checks in most deals makes a firm competitive with seed managers

Semil Shah · Nov 21, 2022

A seed investor's job is to teach founders how to interact with investors and choose the best partners, so losing a deal to a better-fitting firm is an acceptable outcome

If the entrepreneur ends up happy with the right partner, that is fine; he is friendly with everyone in the ecosystem

14:58 Losing a deal to a better fitting investor is an acceptable outcome since the investors job is to guide founders

Mike Lazerow · Aug 2, 2021

A VC can move from co-investor to lead without becoming a competitor by staying genuinely collaborative — no sharp elbows, optimizing for the long term rather than any single deal's allocation

As soon as a firm starts talking about what it needs, it stops being about the entrepreneur; being helpful over time is what earns allocation later, as with Scopely opening up a big allocation and Leo Labs inviting them in

35:59 Collaborative non competitive posture earns lead allocation over time

Avichal Garg · Apr 11, 2022

Ownership caps in crypto create a collaborative equilibrium because each investor must choose which other investors fill the remaining allocation, and prefers genuine experts over deadweight on the token cap table

If you can only buy 3-5%, the question becomes who else you want at the table, and expert co-investors add more value than passive ones

8:37 Ownership caps in crypto force collaborative selection of co investors

David Tisch · Feb 5, 2024

An investor who develops sharp elbows will have sharper elbows used against them by the rest of the ecosystem

Reputation for competing gets noticed and reciprocated

8:43 Sharp elbows invite reciprocal sharp elbows

Terrence Rohan · Feb 5, 2024 · hedged

A collaborative seed firm can win by telling an 'and' story that acts as a counterbalance to a multi-stage lead on the cap table, rather than by competing with it

8:59 Seed firms win via complementary and story rather than competing with multi stage leads

Mo Koyfman · Aug 8, 2022

There has been a lot of shortsightedness in venture around making room for helpful co-investors, and downturn cycles expose that behavior and make it come back to bite those firms

He has experienced funds refusing to budge even slightly despite how additive he would be to the company, and these are the kinds of cycles where such behaviors are laid bare

33:00 Shortsightedness about making room for co investors gets exposed and punished in downturns