The Top 10 Lies of Entrepreneurs and Investors
The Top 10 Lies of Entrepreneurs and Investors
“There are three types of lies -- lies, damn lies, and statistics.” ― Benjamin Disraeli
From my experience listening to pitches, I’ve seen two sets of top 10 lies: one of entrepreneurs and one of investors and I wanted to share them with you so that you know what not to say and what not to believe.
Top 10 lies of entrepreneurs
-
“Our projections are conservative.”
-
“Jupiter says our market will be $50 billion in 10 years.”
-
“Several Fortune 500 companies are set to do business with
us.”
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“No one else can do what we’re doing.”
-
“Hurry up because other investors are about to do our deal.”
-
“Our product will go viral.”
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“The large companies in our market are too big, dumb, and slow to
compete with us.”
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“Our management team is proven.”
-
“We filed patents so our intellectual property is
protected.”
- “All we have to do is get 1 percent of the market.”
Top 10 lies of investors
-
“I liked your company, but my partners didn’t.”
-
“We are patient investors who want to help you build a great
company.”
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“If you get a lead, we’ll invest too.”
-
“There are no companies in our portfolio that conflict with what you’re
doing.”
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“Show us some traction, and we’ll invest.”
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“We love to co-invest with other firms.”
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“We’re investing in your team.”
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“We have lots of bandwith to dedicate to your company.”
-
“This is a plain, vanilla termsheet.”
- “We will get other companies in our portfolio to work with you.”
The investors have money.
It’s not all bad news. Think of everything that an entrepreneur needs (tech ones, anyway), and you’ll see that most things are free or cheap.
-
Marketing: Use blogs and social
media to promote your products.
-
Tools: Most tools are Open Source and free. Microsoft
offers free versions of applications like Word, Excel and PowerPoint in the
cloud.
-
Infrastructure: More cloud goodness—you don’t have to buy
servers anymore.
-
People: Callous for me to say, but in a recession, people
are free or cheap.
- Office space: What office space? You can work out of your garage (like Bill Hewlett and David Packard) or just form a virtual team.
Promotional consideration paid by Microsoft.
Guy Kawasaki is the author of twelve books including APE: Author, Publisher, Entrepreneur — How to Publish a Book, What the Plus!, and Enchantment: The Art of Changing Hearts, Minds and Action. He’s the former chief evangelist of Apple and currently an advisor to Motorola. Guy shares enchanting stuff on the topics of marketing, enchantment, social media, writing, self-publishing, innovation, and venture capital.
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Originally posted to Open Forum
Photo credit: Thomas Hawk/Flickr
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