greed, and a lack of oversight? I'm no fan of capitalism, it has many flaws. I'm not upset at VC's losing money though, thats the risk they take, it's a high stakes game, thats why the IPO failed, there are more rules for a listed company. The only alternative I can see is to regulate who can invest their money in what, I can't see that working, unless I'm missing something.

There is a failure for the employees, but everyone knows, or should know they're rolling the dice working for a startup, as others have said shares are lottery tickets, and the system is stacked against you as an employee ever making money.