Link: lots of capital, little control

With all the money sloshing around looking to find a home, startup funding might be a bit of a sellers market:

Venture capitalists are now relatively less in the business of choosing the best startups in which to invest, and relatively more in the business of getting the best startups to choose them as investors. Money is plentiful and good startups are relatively (relatively!) scarce, and so the startups can be picky. And venture capitalists are increasingly doing public relations to try to become famous, so that the startups that will become famous will choose them as investors. “Some firms are realizing, ‘Huh, maybe awareness doesn’t just magically grow on trees,’” says the founder of a public relations firm.

And once startups are public, investors get little control:

So here too the founders seem to have the power and the people writing the checks don’t. In private markets, investors have to demonstrate their merit to be allowed to invest. In public markets, anyone can invest, but they don’t really get any control over the company. Capital is plentiful, and the people with the companies just don’t have to do that much to cater to the people with the capital. I suppose it makes sense so many unicorns are, in Griffith’s words, “a financial sinkhole”: If you don’t have to be too solicitous of the people with the money, you might as well spend a lot of it.

Source: The Unicorns Are in Charge Now