Last week, we asked “When Should Entrepreneurs Lie?“We have the answer, and it is: never.
We noted that lying is morally wrong and that anecdotal evidence seems to suggest that truthful entrepreneurs are more successful, but also remarked that a certain kind of “white lie” or “exaggeration” is absolutely rife in the business world, and that it doesn’t seem to be a big deal in many cases.
We are in the “don’t lie” camp but we wanted to put forward the question openly and without sanctimony.
Now the results are in. Chris Dixon tweeted: “Is this a joke? Of course they shouldn’t.” Other commenters pointed out (as we did) that some kinds of lying are actually fraud, and just very very bad. Many commenters drew a bright line between “salesmanship” and presenting truthful information in a favourable way, which is acceptable, and “exaggeration”, which is bad.
But our favourite response (honestly) was that of our own Henry Blodget, who we just have to quote in full:
Entrepreneurs should NEVER lie. Even exaggeration blows your credibility.
Obviously good salesmanship is important, as is how you present information. But having listened to thousands of entrepreneurs tell their stories over the years, I can tell you that the thing that immediately raised my suspicions was any statement that damaged the credibility of the entrepreneur.
Some entrepreneurs just don’t know what they’re talking about when they make grandiose claims and projections. Some have no idea how hard it is to succeed, what successful companies’ financials look like, etc. That’s called “cluelessness,” and it also hurts your credibility. But it doesn’t hurt it as much as lying.
We wholeheartedly agree. It’s not just morally right, it’s bad business.
So there you have it, entrepreneurs. NEVER lie.
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