Like every other startup out there, you probably believe that yours is the most unique, ground-breaking one around – one that deserves all the attention and investment you’re working so hard to get. And that’s not a bad thing – if you didn’t believe that about yourself, you’d be in the wrong line of business! But are you taking that confidence a bit too far? Eric Ries has a great post up about the top ten lies told by entrepreneurs – inspired by Guy Kawasaki’s must-read book, The Art of the Start.
The problem with these little lies is not just the fact that they’re exaggerations or misrepresenting your business – they could actually jeopardise your chances of success! So read on and look out if you’re guilty of any of these…
1. “We’re signing a key contract next month”
It’s great that you’ve got a potential deal in the pipeline – but until it’s signed, done and dusted – be careful how you present it to a potential investor. Because if next month rolls along and it still hasn’t been signed, then it could potentially impact your credibility. Moral of the story? Don’t mention contracts or deals until they’ve definitely been signed off!
2. Projecting ‘impressive’ figures
Most entrepreneurs are pretty guilty of this one. It’s tempting – you want to show confidence in your future, so what better way to do it than telling your potential investor how many millions you’ll be making 5 years time? It doesn’t wash. Every Hustler out there has come out with the same old line – and investors can see straight through it. The reality is that you won’t know where you really stand until the product is rolling – and sometimes it’s ok to admit that.
3. Bad-mouthing big, established companies
Think that you can just pluck a big name out like Apple or Microsoft – and tell your potential investor that they’re too over-the-hill to pose any threat to you? This is basically the entrepreneurial equivalent of wimpy trolls clogging up forums with anonymous snark. It’s not particularly impressive, and it doesn’t convince anyone that you have some competitive advantage over Apple, Microsoft, Google, or whoever you’ve picked. All it shows is that you’re being naïve. It’s better to acknowledge that there is some tough competition out there – and even better to show your potential, by highlighting the segments that have gone ignored by them.
4. Saying you have ‘first-mover advantage’
This is a really good point to take into consideration. What do you really mean when you spout this line? How do you even know if you’ve beaten everyone else to get there first? If you’ve got a great idea, there’s a pretty good chance a dozen other startups have had it too. Secondly – being the first one to do something isn’t always such a great thing. It’s much better to have the chance to learn from other’s mistakes – and be even better at it.