Am I Lying or Just Being Optimistic?

The outcome is often a telling sign of optimism and lying.

We spend a lot of time as founders telling stories about the potential future of our startups. These stories often balance between optimistic gestures of hope or a sordid tale about deceit.

Are we lying when we promise our customers that we can deliver a product that we don't have enough staff to deliver? Are we lying when we brag to investors that we will become a billion-dollar unicorn? Are we betraying their trust when we ask someone to quit their high-paying job in order to work on an idea that we haven't proven to be viable?

As founders, we are constantly faced with a moral dilemma. We try to convince the world that bold predictions can come true while simultaneously trying to support the veritable mess that our startup is.

All Optimism Is a Beautiful Distraction

We would love to believe that unbounded startup optimism doesn't just represent optimism but a positive outlook toward a better future. This sounds noble, at first glance. For the most part, founders have noble intentions and optimism.

Let's just call it startup optimism. It is wishful thinking that aims to gather the resources needed to make this dream a reality. We are actually focusing on the future while neglecting the present.

Telling an investor that your startup could be the next "Facebook For Pokemon" is really distracting them from their present (parting with their capital), in order to get our attention long enough to hopefully make that dream a reality. Optimism is by default the most important resource because it creates the illusion of the future while ignoring the present. (This again, often sucks!)

Lying requires knowing

Our optimism is not straight-up lying. This is because we must know the truth in order to be able to believe it. Every founder must manage this slippery slope.

Let's suppose we run out of cash. We tell all our staff to keep working, even though we don't have the money for the next payroll. That's lying. We knew that the money was not there and deliberately did not tell our staff about it. If we expected a new round of capital to come in, but it didn't, it was just hopelessness. We didn't know the money was there so it wasn't lying. Fun fact: They won't care if they don’t get paid!

It is also important to consider whether the statements are made in good faith. They don't believe us 100% when we tell them that our company could be worth $1 billion. They are aware that there is potential but they don’t go home and tell their families, "Welp, Family, we now have 10% of a Billion dollars!" We're moving! Pack your stuff! We are confident that both sides will be able to assess their own risks and we don't want to limit the possibilities.

Balance the Hope and the Lies

Honest Founders are on the right side of this equation because we share our optimism and hopes. Our predictions are based on what is known. We then add our optimistic hopes to them.

We tell our staff that we have 3 months runway left, but our goal is to raise more capital before that time runs out. While we don't lie, we also present the truth. However, we use our optimism to help us rally our resources towards a common goal.

Nostradamus is not for us all. It is not possible to predict the future accurately. We are expected to present our vision of the future as it is, and with full disclosure of all that we know. If we combine them in harmony, honesty and optimism do not have to be competing moral dilemmas. They can serve as the foundation for all aspects of how our startups are presented.