LIIS NARUSK: We need to talk about harassment

It’s a spring Tuesday morning in Tallinn. I’m sitting in the office of an Estonian VC firm, listening to their vision for Estonia and for Europe. The room is full of the essence of the Estonian startup ecosystem: ambitious, optimistic, driven, intellectually curious people building the next generation of companies.

The future is being built in this room, but there is also another room...

Later during the day, in that room, I am mentoring a female founder who is trying to close an investment round. One of her potential investors has started sending her ambiguous messages with a clear manipulative and sexual undertone. Wrapped in the kind of power dynamic that makes it difficult to ignore and risky to confront. She’s also afraid of the potential backlash and how other committed investors would react if she says no.

This is not the first time I’ve had a similar conversation. Not for me. Not for her. Not for almost any female founder I’ve spoken to.

One founder was asked, just before closing her round, whether she would consider becoming the investor’s mistress. Not ambiguously, not in a way where “she maybe got it wrong”. No. Explicitly. She stopped the whole fundraise process there and then. Hundreds of hours of hers and her team’s time wasted, nerves wrecked, and the built up momentum lost.

Another female founder was offered a penthouse apartment by a potential male investor in one of the global financial centres. To stay there whenever she wants to, and to sleep - with or without him. The same female founder was once told over a dinner table by a well known global VC partner - you should love me more.

Another was told, half-jokingly, that she should “use her charm more strategically” if she wanted the round to move faster.

These are not edge cases. And these investors are not some random dudes, they are respected businessmen in very respected companies.

A Y Combinator + Callisto-backed survey (2025):

• 1 in 5 female founders reported inappropriate incidents from investors
• 15 cases involved sexual coercion (quid pro quo)
• Most did not report it due to fear of retaliation

A separate report by All Raise found that nearly one-third of female founders had experienced inappropriate behaviour during fundraising.

Yet, most of these stories never surface.

So if you’re a male founder or investor reading this, your reaction might be: I’ve never seen this happen.

That’s precisely the point. That’s exactly why I’m using this analogy. A house with two rooms (adapted from Sarah Steed, who has written brilliantly about the same problem in another context).

In one room, things are handled privately. Conversations happen quietly. Language like “he was just joking”, or maybe even “he’s working on it”, or “let’s not make this bigger than it needs to be” gets used.

Conclusions are reached. In the other room, a founder continues her life without access to that information. She is told — kindly — not to make things more difficult than they need to be. Or she decides that herself, not to make a big deal out of it, as there’s a company that needs building, a team that needs leading.

Many male founders operate in one version of the ecosystem. Many female founders operate in another.

The mechanics of building a company—hiring, fundraising, product, growth—are already hard. For anyone. But for female founders, there is an additional layer: navigating inappropriate behaviour, power misuse, and subtle or explicit coercion, often from the very people who control access to capital.

This has real consequences. Not just emotional, but also economic. Time and energy are diverted away from building the company. Decisions become distorted—Do I push back and risk the deal? Do I ignore it and tolerate the behaviour? Do I walk away and lose months of runway?

In the worst cases, it leaves a lasting psychological impact. And at a system level, it distorts outcomes.

We talk a lot about improving the quality of startups and capital allocation in Europe. If founders are making decisions under pressure that have nothing to do with the business itself, then we are not allocating capital based purely on merit.

Research confirms harassment in entrepreneurship is “common yet understudied” and directly affects participation, decision-making, and success outcomes.

So why does this keep happening?

Part of it is structural. Venture capital is a high-trust, low-transparency industry built on relationships, closed-door conversations, and asymmetric power. There is rarely HR or formal accountability. Reputation travels informally — and selectively.

Part of it is cultural. Our ecosystem still tolerates a level of 'grey zone' or downright wrong behaviour. Each individual case is easy to dismiss. Collectively, they form a pattern.

And part of it is silence.

Founders don’t talk because:

• They fear reputational damage (“difficult founder”).
• They fear losing current or future funding.
• They assume nothing will change.
• Or they simply want to move on and focus on their company.

So the question is not just why this happens, but why we keep tolerating it.

Every ignored incident sets a precedent. Every workaround reinforces the idea that this is “just part of the game.” Every founder dealing with this spends less time building her company.

If we care about building a high-performing startup ecosystem in Estonia and Europe, this is not a side issue. It is a distortion of how capital gets allocated.

Right now, we are still operating in two rooms. One where things happen, and one where we pretend they don’t. Systems don’t fix themselves. They change when we stop tolerating what we already know is happening.

Liis Narusk is a founder and ecosystem builder focused on improving how ideas, science, talent, and ambition translate into real companies. As a board member at the Estonian Founders Society, she works on founder resilience and addressing structural inefficiencies in the startup ecosystem.