Posted by Anonymous on 2010-01-29
We’re a well known start-up, well into double-digit million revenues, with operating profitability. After speaking with a lot of folks, we got attractive term sheets from several and wanted to proceed with IVP. Dealing with Dennis Phelps, we were persuaded that this was a guy we could work with productively, even if we didn’t think the candlepower was there to add a lot of value.
We should’ve got the creepy tingle that you get in horror films when they insisted on an exclusivity provision. Seemed rather odd, but under heavy pressure, we figured it wasn’t really going to hurt. That’s when Steve Harrick joined in the conversations and due diligence.
Unbelievable to us, our existing VC, and our banker and attorneys, they came back three days later with a term sheet at 2/3 the price and lots of the extra bells and whistles on it. What’s more, they didn’t even have the decency to call me up, or better yet, meet me face-to-face to explain themselves (can’t believe Dennis still doesn’t have the courage to call and apologize). We had our attorney pass and waited out the exclusivity period. We eventually got our cash from another source, hit our numbers, and will be out in the public markets in two years or so.
In the meantime, my strong advice to any entrepreneur is to avoid IVP. Bad faith, bad instincts, and bad manners.PRIVATE: Members Only (466 Characters)