[kordless]

Speaking from observation, the claim may be considered true if the primary purpose of investment firms is to exit the position as either a large gain in value, or a complete loss. In other words, investment strategy today causes the outcome of the company to avoid finding a "happy medium" where the company is able to just make enough to pay the employees that work there to build a good product the customers like and which serves those customer's interests, even at the expense of additional revenue.

VCs don't invest in breakeven, or slightly ahead of breakeven companies. They would rather force a product move by the company to try to make more money for the stakeholders, even at the risk the move kills the company OR hurts the customer's privacy/UX experience. Case in point, Facebook.

[bingojess]

Maybe a better way of phrasing it would have been "most startups that raise money still go out of business"