What 'Ted Lasso' gets wrong about venture capital

• Warning: There are spoilers ahead for season three of Apple TV+' hit show "Ted Lasso."
• Keeley (Juno Temple) starts her own PR agency with funding from an elite venture capital firm.

In the 10th episode of the third season of Apple TV Plus' hit comedy"Ted Lasso," Keeley Jones, a model turned girlboss who runs a public relations firm, steps into its office to find it a ghost town. The furniture has been hauled off. Employees clear out their desks into boxes.

Flabbergasted, Keeley, in her signature campy, pink-laden fashion, asks her chief financial officer what's going on.

"The board of the VC have decided to pull funding," the employee explains. "They're shutting down KJPR."

This bombshell might be particularly surprising to anyone who knows a thing or two about how venture capital works.

The third and final season of "Ted Lasso," which follows an American football coach as he attempts to turn around a struggling English soccer team, has been panned for its overlong episodes, cartoonish characters, and unruly plots — none as implausible as the saga of Keeley's PR agency.

This season saw Keeley step out of her relationship with a footballer and into the role of chief executive officer. She's the founder of a public relations firm, Keeley Jones Public Relations or KJPR, with the ultimate Barbiecore office that features bubble gum walls and a large ceramic jungle cat.

The money to run the shop, Keeley explains in the season premiere, comes from an elite venture capital firm. Strangely, Keeley had never met the investor, Jack Danvers, who wrote the check. Flush with cash, Keeley hires a staff that includes three boomers in full business attire. To her dismay, the venture firm installs a chief financial officer to keep watch over the agency and its freewheeling founder.

We haven't seen a business plan, but it's farfetched that a venture capitalist would back a public relations shop.

Investors seek out businesses that can reach a large market of potential buyers, with the hope it will generate hundreds of millions of dollars in revenues. Long-term, they need the company to go public or sell to a buyer so they can sell their shares at a mark up and return money to their investors. Even Edelman, the world's largest PR firm, cracked $1 billion in revenue after 70 years in business only last year.

"The logic that a PR agency would be a good VC deal is ratchet," said Kathy Osborne, founder of Kamel PR. Public relations is a cash-flowing profitable business, she explained, that doesn't need the same lifeline as a startup.

In episode four, we meet Jack, the effortlessly cool financier who's been bankrolling Keeley's business. In their first encounter, Keeley is shocked to discover that the male investor she had been emailing is, in fact, a woman.

It's implausible that a founder would raise money from a venture capitalist without meeting them. Particularly in a Zoom era where founders can pitch investors over video. Investors care almost as much about the idea as the person behind it, and so they try to get to know the individual before putting in any money. The same goes for founders. They look for an investment partner who fits their criteria.

The setup that Keeley and Jack hadn't met before signing a term sheet is wilder than Coach Beard at a dance club.

Soon, the beauty and the suit fall into a hapless romance. They share a kiss behind the frosted glass walls of Keeley's office and traipse around a mini golf course in cocktail attire. But their fling goes haywire when a steamy private video of Keeley gets leaked and goes viral. Worried about the impact on Keeley's business, Jack becomes more concerned with damage control than Keeley's feelings.

Jack tries to corner her publicist-girlfriend into releasing an apology statement. When Keeley says she won't do it, Jack breaks up with her and pulls the agency's funding. Overnight, the venture firm fires Keeley's staff and shuts down the company, without so much as a call to Keeley.

This misconstrues how venture capital works.

After a firm signs a term sheet, the fund wires the money to a startup for shares of ownership. They can't claw back the cash once it lands in a startup's bank account.

Here's a more realistic scenario. Jack tells Keeley that her firm won't send any more money, if the capital hasn't been called already. Now Keeley has to look at how long she can keep the lights on with the funding she has. If runway is short, she could decide to lay off some employees to cut costs or sublease the office to bring in some extra money. Cash would still flow to the agency from existing clients.

In the end, Keeley joins forces with her no-nonsense chief financial officer, Barbara, to restart the agency as KBPR.

This time, venture capitalists need not apply.