You tell someone exactly why something won't work? Get rewarded with a door to the face. You save precious time because you care about actually building something of value. But you get no money.
Yes Man comes along. Takes the money. Fails spectacularly. Yes Man doesn't give two shits about improving anything and walks away rich(which is all they even wanted).
So hilariously ridiculous, but this kind of thing happens. All. The. Time.
So, in other words, investors are looking for non-innovative projects (due to their blind risk-aversion). Why would you do that? If you are looking for low risk, index funds are available. There are lots of options if you want to spread your risks. I guess the simple answer is most I've talked to simply aren't that smart (as investors anyway)... :/
Software VCs are so risk averse because startups have to find product market fit, which is already risky without throwing a bunch of tech risk on top of it.
That PMF bit is crucial: biotech VCs' don't follow that same pattern because they have relatively precise methods to identify product market fit, before the drug is even approved for sale. They have much more precise data on how many potential potential customers each drug could possibly have from public health data, how much they can afford from previous agreement and contracts with insurers combined with quality of life improvement estimates for the drug candidate, and a minimum of a 5 year monopoly which is usually closer to 14 years. Thanks to those factors, biotech companies have a damn-near-guaranteed exit strategy by phase 3 trials in the form of an acquisition or zero revenue IPO and the VCs can take much bigger risks.
VC funds needs to make money, that only comes of an exit , if you can have real revenue before getting an exit it is great , if you are solving a real problem even better, but those two are not going to help VC meet their goals directly .
You as founder are spending 5-10 years on one thing , for the VC your startup is one among the dozen he is getting on, their tolerance of your failure is far higher than your own tolerance for your failure
If I had raised more money, I would have wasted even more years before coming to the very painful reckoning that my startup was just untenable. I realize my tangent is unlikely related to your point and is separate from the article, but for a first time founder I am very glad I stuck to my integrity and only lost a few years of my life learning a valuable lesson instead of a decade.
In fact, I recently had an epiphany - if my startup succeeded and I'd become rich, I'd be a much shittier person today because of it. That failure fucking wrecked me but I needed it.