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The Top Ten Lies of Venture Capitalists from Guy Kawasaki

Venture capitalists are simple people: we’ve either decided to invest, and we are convincing ourselves that our gut is right (aka, “due diligence”) or there’s not a chance in hell. While we may be simple, we’re not necessarily forthcoming, so if you think it’s hard to get a “yes” out of venture capitalist, you should try to get a conclusive “no.”

This is because there’s no upside to communicating a negative decision. Entrepreneurs will simply hate us sooner–instead the game is to string along entrepreneurs in case something miraculous happens to make them look better. (An example of a miracle would be Boeing approving a $5 million purchase order.)

Alas, entrepreneurs are also simple people: If they don’t hear a conclusive “no,” they assume the answer is yes. This is an example of the kind of breakdown of communication between venture capitalists and entrepreneurs that causes much pain and frustration for entrepreneurs.

To foster greater understanding among the two groups, here is an exposé of the top ten lies of venture capitalists.

Full List: http://blog.guykawasaki.com/2006/01/the_top_ten_lie.html

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