I first covered Launch House in Oct 2020, when the co-founders described a strong focus on inclusion when creating hacker homes. A co-founder said then, “I wouldn’t say we’re the next Y Combinator, but the next YC would look something like that.” The company soon went onto raise venture funding for its vision of what a next-generation entrepreneurial ecosystem looks like, combining remote work’s benefits with the rising mindshare around “community.” It won over investment dollars from Andreessen Horowitz, Lightship, CAA co-founder Michael Ovitz, Electric Ant’s Chris Ovitz, 6th Man Ventures’ Mike Dudas and other angels.
Now, a Vox investigation this past week highlighted specific allegations around harassment, sexual assault and misuse of power at Launch House. The response has been complex. The irony with the “build in public” mindset is that, when allegations and scrutiny surface, privacy — or at least opacity — is back in vogue.
As TechCrunch reports, some existing investors in the startup and its venture fund have issued public statements supporting the alleged victims and denouncing the alleged behavior described by Vox in its article about Launch House. Launch House, meanwhile, confirmed to TechCrunch via a spokesperson that it is launching an independent, third-party investigation through a retained law firm.
Days after the investigation went live, Launch House held a town hall with some members of their community. Co-founder Michael Houck said that the startup “dropped the ball on responding to this quickly enough [and] with enough compassion … that isn’t reflective of the values that we’ve built this community on from day one and that we care about.”
“Put more simply, we absolutely should have met with you all sooner than today,” Houck added, “What I can say now is that we’re ready to speak and we have a plan.” The conversation focused on three topics: what Launch House says it has done in the past, what it will do in the future and how it plans to build back trust with female founders in their cohorts.
The Vox investigation, Launch House’s response both publicly and privately, as well as the community’s either outrage or silence over surfaced allegations is a reminder that community isn’t a buzzword. It’s a challenge. Some people may look at LH as a caricature of the “community-based VC-backed startup” trend, but this offers a real look at what happens when these “buzzy trends” meet a bull market, in a remote world, with limited checks and balances.
For the full story of key details in the private town hall, read my story: “Launch House holds private town hall, says investigation is underway.” For the investor and community reaction, read my story with Rebecca Szkutak, “Launch House’s community reacts to misconduct and harassment allegations.”
In the rest of this newsletter, we’re talking about Y Combinator’s paranoia, fund manager shifts and a follow-up on one of the pandemic startups admitting it’s wrong. Make sure to read the whole thing as I’ve snuck in a TC+ discount code, especially for Startups Weekly readers, in the post.
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