>The huge investments themselves are something founders would dislike, if they realized how damaging they can be. VCs don't invest $x million because that's the amount you need, but because that's the amount the structure of their business requires them to invest.
It is a pity that the whole essay does not go a bit deeper and explain what are these business requirements here. Imho the main reason VCs (and angels too - if they are not from the 'family and friends' group) want bigger investments is to align the founder and the investor incentives. VCs want a binary option - big success or total failure and want to eliminate the third option of 'life style business' - that is a perpetual small business. In a 'life style business' there are too many avenues for continuously extracting small amounts of value from it so making it a fair game would require too much control from the investors.
It is a pity that the whole essay does not go a bit deeper and explain what are these business requirements here. Imho the main reason VCs (and angels too - if they are not from the 'family and friends' group) want bigger investments is to align the founder and the investor incentives. VCs want a binary option - big success or total failure and want to eliminate the third option of 'life style business' - that is a perpetual small business. In a 'life style business' there are too many avenues for continuously extracting small amounts of value from it so making it a fair game would require too much control from the investors.