The VC Hippocratic Oath

In medicine, the Hippocratic Oath stands as the standard of ethical responsibility. Dating back to ancient Greece and attributed to Hippocrates (widely regarded as the "Father of Medicine"), the oath arose from the need to formalize ethical standards. Adhered to by physicians for centuries, its core principle, primum non nocere—"first, do no harm"—provides a compass to guide decisions and actions that could have life-or-death consequences.  The oath, however, is not merely about technical competence but about ensuring that power and knowledge are wielded responsibly.

You might ask, “how on earth does this relate to the world of startups and venture capital? Surely he’s not suggesting VCs are making life-or-death decisions…”

Surely I’m not. However, the metaphor is apt when you consider founder and VC board power dynamics. Let me explain…

As much as founders appear to be in the driver’s seat today, when it comes to boards, VCs still wield a lot of power and influence: in most cases founders really look up to their VC board members and pay outsized attention to their advice. And via that relationship, most VCs are focused on adding value to their portfolio companies. But in my experience, this is a secondary goal: the principal aim of a good VC and board member should be first to not harm their portfolio companies. 

In this post I’ll try to explain why the founder <> VC relationship is so privileged, and a few of the ways in which VCs overextend and end up – quite contrary to their intentions – hurting the very companies they’re trying to support. Then I’ll propose a point of view on how VCs can actually positively impact their companies, or at least what has worked for me. 

The road to hell is paved with…

I remember, vividly, a talk that the legendary professor Bill Sahlman gave at HBS when I was a student. It was for future founders, about VCs. I’m paraphrasing but he said something like this:

‍“About 10% of the VCs you meet will make a real positive impact on your company. In my experience, however, about a third will actively harm your company. And the rest? Think of them as neutral capital. Your job as founders is to identify and avoid that bottom third at all costs.

It’s that bottom third that doesn’t get enough attention. Who are the investors who actively harm companies? Sure, there are the occasional VCs who are lazy or vindictive. But the majority of VCs who harm a company have the best of intentions and aren’t trying to do so – it happens because in their effort to help, they overextend and provide repeated bad advice to their founders. At best, bad advice is a distraction to founders who critically need to focus. At worst, it can lead companies down the wrong path and sink their chances of winning. 

There are three things I want to establish here:

1. Founders and VCs have an intimate, privileged relationship where the VC is in a position of power.
2. VCs, especially junior ones, tend to overextend and provide advice on things they don’t really know much about.
3. There is a major risk that, despite your best efforts to be helpful, you actually end up harming your companies.

The dynamics here are understandable. With ever more capital in the ecosystem, being a VC has shifted from a capital allocation job (picking the right startups) to a sales job (the right startups picking you). In this environment, there’s enormous pressure to be as “value-add” and differentiated as possible. Consequently, there’s an urge to opine on any and every topic, and it ends up backfiring. You think you are helping but you are actually the problem.

Each company is a highly dynamic organism, operating in a much larger emergent ecosystem. Companies have completely different sets of personnel in addition to a distinct culture, product, market, and timing constraints. The belief that you can match one company’s experience to another is, in my mind, naive. Many of these errors arise from survivorship bias. If you’ve had one or two really successful companies, the tendency is to overfit what worked for those companies onto others; and your founders will be actively asking you to do that because they want to succeed like Datadog or MongoDB or Snowflake.

If you give bad advice, there’s a strong chance that your founders will follow that advice. We’ve all chuckled at countless memes about how VCs don’t know anything and founders should ignore them: this is, as anyone who is actually running a company knows, complete bull$hit. Founders give immense credence to the opinions of their board members. And it is because of that that VCs need to be judicious with what they say in respect to that sacrosanct relationship.

Frankly, often the best answer a board member can give is “I don’t know” followed by “but I can connect you with a few people you might.” The best board members I’ve seen spike on epistemic humility; they save their questions and spare their advice, because they appreciate the founder <> VC power dynamic and the sanctity of this relationship.

This is where the Hippocratic Oath, that sacred code of ethics, must come in. In your quest to help, make sure you’re not hurting first. 

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How can I (actually) be helpful? 

So assuming you’re trying not to be in that bottom third of board member VCs who harm their companies, how can you be more than just neutral capital? Great board members do exist and they often do make an outsized impact on a company. 

VCs have both a unique perspective, along with a deep network and plenty of data on many companies, plus a unique relationship with founders. They act as a mirror providing a not-entirely-objective but far away enough from the sauce party to bring something new to the table.

Think of it like that friend you have who is always ready to give you advice on whatever you’re dealing with, despite having dubious personal experience in the matter. The point isn’t whether they know what they’re talking about, it’s that they’re not you, but they know you, and so they can see what you’re going through via a different, less-partial lens. You love that friend.

In my experience, I’ve seen board members impact their companies through three perspectives and / or activities that VCs are uniquely positioned to offer their founders. 

1) Prioritization and focus

At any given point in a company’s life, there will be million things that are going haywire. A good VC board member’s job is to help the founder figure out what the one or two most important things actually are, and focus on those things to the exclusion of all else. 

Good board members know that their hands are strictly not on the steering wheel of the company. The best analogy is that if founders are the pilots in the cockpit, the board members are air traffic controllers letting them know of storms on the horizon. As board members, VCs are uniquely positioned to guide founders to the highest leverage problems for the company. And if you’ve started a company before you know that this is maybe the most important thing. 

2) Talent and expanding the founder zone of competence

A good board member should help founders understand their and their company’s skills gaps; to then guide them to what early roles are most important, when they need to fill them, and then — to borrow from the metaphor above — actually get people into the company who can put their hands on the wheel. 

At Amplify, specifically, we partner with early stage technical founders. Most technical founders have never hired for non-engineering roles before. These types of hires are usually outside of the founders’ comfort zone. So we play a crucial role in helping them figure out when it’s time to bring on a first sales hire or marketer, what “great” in that function looks like, and then actually getting the right person in the seat. Making the right hire at the right time is, by far, the most trajectory-altering assistance a board member can provide. 

3) Data (and perspective)

Experienced VCs sit at a unique vantage point, having served on the boards of many successful and often many more less fortunate companies. This breadth of exposure arms them with a rich repository of data—both qualitative and quantitative—that few others can access. Especially at specialized funds like Amplify, where portfolios are composed of companies tackling similar challenges, VCs can draw upon hundreds of case studies to identify patterns and trends. This ability to distill and share relevant insights, tailored to the founder's specific circumstances, is one of the most distinctive contributions a VC can offer.

I spent the first half of this post arguing against generic advice, so it is essential to distinguish between sharing data and dispensing advice. Data provides an objective basis for analysis, offering founders the raw inputs they need to draw their own conclusions. Advice, by contrast, is the subjective interpretation of that data, often shaped by personal biases or incomplete analogies. Said another way, advice can be descriptive or prescriptive; most errors I’ve seen arise from the latter. 

Effective board members understand this distinction, emphasizing transparency in their observations and avoiding prescriptive approaches that risk oversimplifying the complexities of the founder’s situation.

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Though perhaps VCs don’t literally need a Hippocratic Oath, in venture capital, as in medicine, power must be wielded with care. Just as the Hippocratic Oath urges doctors to "first, do no harm," VCs should adopt a similar framework when working with founders. The privileged relationship between founders and their VC board members demands an acute awareness of the influence VCs hold and the potential consequences of their actions. By recognizing the risks of overextension and the pitfalls of applying one-size-fits-all solutions, VCs can approach their role with humility and focus on supporting their portfolio companies in meaningful ways.