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Funding an Entrepreneur's Pedigree

I got sucked into this debate with a friend, who is a great person and definitely not the type of investor I'm arguing against. That's why, it would be nice to hear first hand from the type of entrepreneurs I'm talking about - those who know similar startups that got funded because of better pedigree of founders, while they bootstrapped for years without investor support.
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My friend is trying to explain to someone w/ a Harvard MBA why the 90% net income margin in their financial model is not believable.
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Me
... and yet, in the end, most VCs still end up investing in people with degrees from Harvard and Stanford; coz it's takes talent to spot talent, and a lot of work to support and nurture it. If they fail, it's not the VC's fault; if they succeed, the VC made smart investment.
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My Friend
Murali I think that statement might be a bit over the top. I know plenty of unemployed / unfundable ivy league grads. It's not a magic ticket.

Trivia Q: What fancy school did Ron Conway graduate from?
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Me
Ok, maybe it was a bit over the top (esp. given your original post wasn't about that). But my point remains that, notwithstanding the Ivy league grads you know who can't get funded, I know - and I'm sure you do too - a lot of Ivy-league grads who got funded with a napkin-business plan while similar or better non-IL startups with a product, customer and a much refined business plan struggle to get funded. Again, my point here is the relative ease in access to capital for the IL guys due to the disproportionate weight given by the VCs to the pedigree.
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My Friend
No, I don't know of anyone who got funded because of their degree. The belief that the lack of an ivy league degree holds you back is more damaging than the lack of an ivy league degree.

Conway graduated from San Jose State University. I doubt he cares if someone went to Harvard or not.

Life is what you make it. Ask Ellison and Gates.
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Me
I do know a lot of investors who are lazy, choosing to back a startup primarily because one of the founders has a brand-name pedigree. If they practiced what they preach, they wouldn't lower the bar for the ivy-league entrepreneurs while raising it even more for non-IL startups. For the record, the entrepreneurs I'm talking about do not believe they're held back by lack of Ivy-league degrees- they take pride in their path to positive cash flow by bootstrapping for years. And they don't confuse raising Venture Capital with success- in fact, I also know quite a few who failed because they raised VC money too soon.

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