When Stitch Fix founder Katrina Lake told Lightspeed Venture Partners, an early investor in her company, that (then) Lightspeed partner Justin Caldbeck had sexually harassed her, the firm asked her to sign a non-disparagement agreement. Not signing, a source suggests, could have endangered her entire company's future. So she signed, and remained silent about her experience.
Why it matters: Lightspeed today tweeted that it regrets not taking "stronger action" when it learned of Caldbeck's alleged behavior. Lake signed the non-disparagement clause while Stitch Fix was trying to raise money — which it eventually did in a round led by top-tier VC firm Benchmark. Lightspeed could have blocked that investment.