Founders should stop lying. Investors should stop making them.
Lately, I’ve been having a hard time with the magical thinking so pervasive in the startup community. And by a hard time, I mean I’ve been throwing up in my mouth a little when it happens and I’m in the room. Especially apparent in fundraising, the unfortunate truth is that we all lie, all the god damn time.
We’re lying so we look better.
Look at the SIZE of this MARKET. Or this growth TREND (meticulously calculated from our best possible months). Or this Chilean Sea Bass, I’m telling you — it was <-— — — THIS — — — —-> big.
We’re lying so we feel better.
No but really, still… look how big this MARKET is. Our competitor only provides for this niche segment, so we’re bound to succeed. Oh, sure that number is global — and we’re US only, but we’ll expand later. Um, yeah, we’re actually only for women. With smartphones. That are jailbroken.
Sure, we validated with user feedback (I asked two friends). I did everything I could have.
We’re lying to impress.
I BUILT (helped build) this. I was DIRECTLY RESPONSIBLE for (I’m much more important than my team.). I LED (managed) a team (with help). And let’s not even get in to the metrics.
Ok, actually — let’s. 10,000 users (43 active). 100,000 users (400 engaged — wait how do we define engagement again? Breathing? Perfect.) 1 million users (4.32 second time on site average).
We’re lying to grow.
We had a successful Product Hunt launch (I ran a vote circle to get upvotes and comments from every living human being I could get to do my bidding). Three of my board commented — with comments I wrote for them.
We’re lying to emulate a pattern of success.
If I was to tell you that my business was anything less than the all-knowing, all-dancing, tide-changing Unicorn you’re salivating for, would you even be in the room with me? You say you’re hunting disruption, but only when the disrupters fit into the pretty pattern of the last set of disruptors that made you money. How… disruptive.
We’re lying because you expect it.
Oh, yes — here’s my scientifically calculated churn-analysis business finance report for the next three years of my pre-launch, pre-raise, pre-engineering, pre-product-market-fit SaaS subscription company. Thanks for demanding I have this meticulously crafted piece of fiction to raise seed capital. Next, I shall go finish writing Game of Thrones for George R.R. Martin.
We’re lying because you’ve made it the only game in town.
So… to get real for a hot second and put the jokes aside. Do you think I like this stuff? Do you think anyone gets off on self-inflation and the ego train that this much fibbing and exaggeration represents? It’s soul-crushing.
- It fuels the inferiority complex pandemic in the startup industry.
- It moves the pressure from founders to do better and build better things to look better and weave better stories about themselves.
- It puts the founder at risk of drinking their own Koolaid and extending the cost of honest, leadership-driven communication with their team.
And yet, in order to raise capital, founders dig so deep in to the trench of half-truths that we’ve crafted the stories of our products before we’ve crafted our products. The art of the spiel. We’ve spent hours coming up with counters and responses to your questions before we’ve done the same for our users’ questions. The art of dancing around the issue. We’d rather you leave feeling good than leave knowing the truth. The art of avoiding hard things.
Then, when you feed from this trough of artful bunk, you create a self-fulfilling prophecy dictating what we care about, what we extend throughout our organization and what we learn to respect.
Investor’s demands cost truth so founder’s habits lose truth so teams suffer.
Here are some things that I wish more investors would admit are excellent truths.
- You know, I really don’t know that yet. We’re working on it, but I can’t answer that now.
- I recognize you might want a model, but there is no model for this that isn’t rooted in fiction until we have concrete user data.
- Moreover, no year-long roadmap is anything but a charmingly colorful Gantt chart and you totally know that.
- When asked how we’re going to handle X — wherein X is this other potential feature-set. Honestly, we’re not. We don’t want to think about that now.
- I don’t know literally everything about cap tables, the full range of all possibly equity arrangements and I’m not an accountant. I’m also not an idiot, so let’s work through this together.
And there are more. Some a little more salty, some a little less. There are investors out there who get this, and help their founders be better founders. There are founders who no doubt don’t, and whether seeking investment or not, fall trap into the quest for prestige over all else. There’s no one person to blame, though like many things, we can better help ourselves through it from the top to the bottom. Investors, stop making your founders lie. Founders, don’t be such lying liars.