Their employees and the firms that backed them will obviously be affected. But what’s most interesting is what it means for startups that took money from the zombies.

Is having a zombie VC as an investor the equivalent of a scarlet letter?

High-profile investors give young companies a level of legitimacy, deserved or not, in the chummy world of Silicon Valley. Can the opposite be true of having a zombie VC on the cap table?

I posed this question to Ben, who said the implications are huge. If a partner jumps ship from a zombie VC, startups they backed will be in a tough spot. Without their point-of-contact at the fund, they won’t have an advocate.

More broadly, having a zombie VC as an investor won’t necessarily be a death knell for a startup, Ben said, especially if they have many other investors. But it’s also not a great signal to the wider VC community.

And with limited funding still available, most startups can’t afford any perceived knocks against them.