Top 10 Lies Entrepreneurs
By: J. Skyler Fernandes
Top 10 Entrepreneur Lies
1) We don’t have any competition!
– If so, it must be a terrible business, every good opportunity has direct and indirect competition.
2) These are VERY conservative projections!
– Bullshit! Why are you showing me conservative projections? Investors want to see
entrepreneurs who think big and achieve big. Instead, say “we believe these sizeable numbers
are achievable because we have been conservative in our assumptions, such as…” Create
believable upside, and that your impressive base case is realistic.
3) We have first-mover advantage!
– Then you’re likely too early to the market. Shoot me in the back why don’t ya. Trail blazers make
lots of mistakes, cost lots of money, and smart followers can pivot faster and pass you by.
4) We have a proven management team that has created and sold a number of
– Really? Then what do you need my money for, fund it yourself!
5) We have a few huge contracts being signed next week!
– Excellent, I’ll fund two weeks from now or when cash is received, whichever is later!
Top 10 Entrepreneur Lies
6) We just started raising capital, get in early, we have investors already interested!
– You mean, you’ve been raising capital for 6 months, stopped, and just started again. The only
investor interested is your grandmother, and she isn’t even an accredited investor.
7) We have patents, we own this space!
– You mean, you have provisional patents (not yet granted) for a very specific small application
because all the genius stuff was taken.
8) All we have to do is get 1% of the market!
– Then whose gonna get the other 99% and crush you? Think like a monopolist and you might just
achieve that 1% that is actually quite hard to acquire. Make sure you’re talking about your target
market, not the larger general market, then you might be ok. At least you didn’t say 20-30%!
9) I’ve tested the market, and people love this idea, it’s gonna be huge!
– Especially with my whole family and closest friends (the beta testers), but I haven’t actually tested
it on my target client yet who will actually pay me for it.
10) This will be the last round of capital we’ll need! Then we’ll sell for billions!
– You mean, this will be the last round before the next round. Entrepreneurs often underestimate
the rounds of capital needed to grow before an exit. Round 1: Tech Development, Round 2:
Capital needed to get to profitability, Round 3: It took longer and cost more than we thought, can
we try that again?, Round 4: We’re barely profitable, we need cash to grow now!, Round 5: There
is growing competition hurting our margins, we need to pivot to win to get us back to profitability.