I had that nightmare too, until I realized something: Online backup is hard to do right. If you don't know what you're doing, you fail spectacularly.
I don't worry about the inexperienced cowboys any more. They'll fail sooner or later.
The investors in the competitor were actually very gracious about it and did a lot to make up for the damage they caused me, which they really were not obliged to do. Interesting how that played out, we still exchange Christmas cards 12 years later.
Focus on the hard stuff, let the cowboys fail and just keep plodding away and you'll be successful somehow. But they can destroy your market for you by giving the whole field a bad name and they can mess up the timing to the point that you miss out on something substantially bigger.
Ideally venture capital (and especially angels) is a force that helps creative people realize their dreams in return for a realistic premium associated with the risks.
They should help with guidance and their expertise to maximize the chances of those dreams becoming a reality, and should use their portfolio to balance the risks between existing money making (and thus now lower risk) ventures and newer high risk early stage ventures.
In practice venture capital all too often distorts the market, creates unrealistic expectations (both for founders, the public and partners alike) and is 'penny wise and pound foolish' when it comes to evaluating new ideas.
Our host is - unfortunately - in this respect, imo not that much different than the rest, even if they do get the mentoring and assistance factor (far) better than most, there is not a single investment in the current batch that I would call worthy of the 'V' in VC, they're pretty safe bets, if they fail they'll fail quickly and if they're going to take off they won't fly too far. The scope of most of those projects is simply far too limited.
It's all about the batting averages, and that's essentially what these small funds are all trying to do, to show a good track record of managing their portfolio in the hopes of landing one that hits it out of the park, more likely than not due to a pivot.
By increasing the dealflow they're playing 'scratch lottery' instead of a strategy game in the casino, statistically speaking if you keep at this long enough sooner or later you recoup your losses with a healthy profit margin and you can continue to play until you score big.
The one nightmare I have is being unfunded, healthy and growing and suddenly getting a copycat me-too project with VC backing and a bunch of inexperienced cowboys in the same space.
That can really ruin your day, and possibly much more than that.
Back in 1997 or so, the real beginning of the .com bubble there was this great cartoon in a newspaper here, it pictured a train with tons of guys in suits, pockets bulging with money trying to get on board. The train was clearly labeled 'Internet', and a reporter was asking one of the guys the question where they were going. The answer: "No idea, but we really don't want to miss this train".