While you are leaving alpha on the table, I don't think that has to be a hindrance until you hit a massive scale depending on how you define ethical. There's always alpha in becoming an experts in some vertical to invest in, just choose a non-controversial vertical and you're already most of the way there. Keep in mind that all the big players have lines in the sand to some degree and often refuse to work with "sin industries", they're leaving alpha on the table too.
Yeah, good point. There are some lines in the sand. I’ve heard stories about the surprising number of startups that are basically doing illegal things and justifying it as being disruptive. Fortunately it comes up during diligence and guess what they don’t get funding.
