This study examines how VC contractual provisions affect start-up environmental and social (E&S) costs. Using hand-collected data from 611 Series A contracts from VC-backed start-ups covering the period 2002–2016, the study examines how VC-backed firms’ cash flow and control rights have different effects on portfolio firm E&S costs during the active investment period. Stronger VC control rights significantly increase social costs, while their impact on environmental effects remains insignificant. These findings suggest that VC-backed firms use governance authority from control rights to prioritise financial performance over social cost reduction. Cross-sectional analysis reveals that these effects are strongest in traditional (non-IT) industries and are mitigated in California’s start-up-friendly contracting environment, indicating that industry context and regional norms moderate the relationship. To address endogeneity concerns, the study employs the Sørensen–Heckman selection correction, using fund age as an exclusion restriction, complementing this with propensity score matching (PSM) and entropy balancing. Results remain robust across all identification strategies. This study advances the understanding of how specific VC contractual mechanisms affect E&S outcomes in private markets, demonstrating that contract design has meaningful implications for start-up social costs.