1) You're going to be in business with your investors for the next decade (if things go well).
2) The pool of investable startups and investors is pretty small, and reputation matters. If you screw a company once, you might juice your expected return from 50% to 55% (likely still an actual return of $0 on any given deal), but if you get a reputation for behaving badly, your dealflow will no longer include good deals, which hurts you far more.
1) You're going to be in business with your investors for the next decade (if things go well).
2) The pool of investable startups and investors is pretty small, and reputation matters. If you screw a company once, you might juice your expected return from 50% to 55% (likely still an actual return of $0 on any given deal), but if you get a reputation for behaving badly, your dealflow will no longer include good deals, which hurts you far more.