Silicon Valley is not really about tech anymore
There is NO silicon left in Silicon Valley. Most of the smart folks left long time ago. Now it should be referred to as Wall Street West. Only Banksters remain in silicon valley (i mean wall street west). Much of what gets called tech is communications, media, publishing and marketing, simply because digital communication is replacing print and Main Street. Most “tech startups” tend to be businesses that intelligently apply existing, off-the-shelf technology platforms to do a dramatically better job addressing a common issue faced by a targeted customer set.
In America, people think building websites, designing apps and moving money electronically is high-tech, and they think Google, Snapchat and PayPal are the pinnacle advanced technology. Meanwhile, they think oil/gas extraction is a “low-tech” business. VCs usually don’t really care about a founders vision (at least not more than whether or not it’s a good enough idea to be profitable) all they care about is getting paid. That’s just how the venture capital business works. The venture partner is working for his limited partners, and they think much like traditional private equity investors or just commercial bankers. Limited partners only want their venture partners to make financial investments in measurable financial assets. The limited partners would greatly prefer there to be audited financial statements, but in a pinch they will let their venture partners settle for a surrogate measure, ‘traction’, from, say, Comscore or some such. It’s a bittersweet relationship, and I personally would rather not go down that road.
For a startup based on software, computing, and the Internet, the path to the coveted ‘traction’ is just one or a few guys living cheaply and typing quickly. Then, with such low ‘burn rate’, once you get the traction, and especially if that traction is growing very rapidly, you stand to profit quite nicely. Thus no longer in great need of equity investment with the usual term sheet that subordinate yourself to a Board controlled by venture partners.