Lies to Avoid – Part 1

First and foremost, Happy 4th of July! After reading this post, take some time to enjoy the day with your families. Try to avoid thinking about your business. Give your mind, family, and friends some much-needed rest.

The following are the first 5 lies to avoid in your pitches, as described by a venture capitalist I met recently:

“Our projections are conservative.” Really? Is that hockey stick growth the investors looking at conservative? Most likely not. They know it, and you know it; so just leave it out of the presentation.

“Gartner, (Jupiter, Yankee Group, etc.) says our market will be $50 billion in 5 years.” We mentioned statements like this before. Build your market from the bottom up rather than from the top down using a realistic reachable market rather than a number projected by an outside group. Now if your realistic reachable market is less than the number in the projected total market, Lucy, you’ve got some ‘splainin to do.

“Boeing is signing our contract next week.” A bird in the hand is worth two in the bush. Until Boeing sings that contract, it is in the bush; so leave it out of investor conversations.

“Key employees will join us after we get funded.” Rely on your current team. Your investors read this as, “we’re not good enough without these employees, and we just haven’t been good enough to land them.” What is the investor’s proof that you will ever be good enough for those employees, and why are those people so important anyway?

“Several investors are already in due diligence.” First investor thought, “why are you waiting until now to come to me, if these others are indeed in due diligence.” Second investor thought, “Does this person really think threatening a moving train will get me jump any faster or any higher?”

We’ll cover the last 5 lies tomorrow, but for now, Happy 4th of July!


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s