In my post, Why You Might Not Get The Meeting, I listed three high-level reasons why you might get rejected by a VC. Another less common cause is the fact that VCs get flashbacks.
Experienced VCs have invested in lots of companies and inevitably some of those companies have failed. When a VC sees a new company that is similar to a previous investment that failed VCs tend to shy away. I'm not certain that this behavior is entirely rational or objective as some investments fail simply because they were too early to market, they had the wrong management or because they were just unlucky. Nonetheless a VC's scar tissue does impact their investment decision making and can therefore affect your fundraising prospects.
The good news is that few VCs have made exactly the same types of investments. As a result, you are not likely to encounter more than one rejection from a flashback.
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