Suspension of Disbelief
“There may be a time when you lie to me. But please, don’t lie to yourself.”
Ever stop to consider, really consider, the role that “fact” plays in entrepreneurship? How objectively true can something be when, by definition, it stretches between what exists today and what might exist tomorrow?
The Fact to Conjecture ratio in entrepreneurship skews heavily towards conjecture. As it should! Especially early on, when so much of what a company does is talk about what it plans to do.
No surprise then, that founders and investors are poster-children for one of the most powerful constructs in human storytelling: the Suspension of Disbelief.
SoD is what allows us to explore speculative worlds, particularly when those worlds depart from our current reality. It allows us to accept the existence of things before they exist.
Without SoD, there would be no entrepreneurship. Few of us would ever start a company. And what fool would bankroll one? Amazing things live between today and what will come tomorrow. It’s the Suspension of Disbelief that lets us bridge the two, and then some.
So what’s the problem? Navigating the difference between SoD and full throttled delusion isn’t as easy as it sounds, especially in a world where entrepreneurs are encouraged to walk the thinnest line possible between aspiration and reality.
In short, the difference between thinking big and being full of sh!t is murkier than most of us like to think.
Sure, there’s true deceit in startups. But after a decade of working as an investor, it’s not the fear of being lied to that keeps me up at night. It’s worrying about founders lying to themselves, about the wrong things, at the wrong time.
I was reminded of this recently when talking with a founder who’d had a wild ride of a year. As we talked about where the company is today and where she wants to be in a year, she wondered how best to walk–or more accurately, talk– between those two worlds. Living through high unpredictability hadn’t diminished her confidence in the company, but it had expanded her awareness of just how many things can go differently than you planned.
The only thing I could say about it was this: “There may be a time when you lie to me. But please, don’t lie to yourself.” Those are the lies that will haunt you. Cause the most pain, for you and those around you.
The reason her company made it through the previous year, as well as it did, was because she knew when to “keep the faith” and when to cut bait. Her commitment never dimmed, but her trust in “always a happy ending” did. She had the courage to ask for help before it was too late. She had to pierce the veil, pierce the suspension of disbelief, if just a smidge.
After this meeting, I asked ChatGPT what it had to say about the consequences of self-deception on entrepreneurs. The a-little-too-on-the-nose bullet list was classic:
1. Unrealistic Expectations: Lying to oneself by inflating one's abilities or underestimating the difficulties can lead to unrealistic expectations. This can result in poor decision-making, misallocation of resources, and increased stress when reality doesn't align with expectations.
2. Hindrance to Problem-Solving: When you lie to yourself about the severity of a problem or your own role in it, you hinder your ability to find constructive solutions.
3. Risk Management: Self-deception can cause individuals to downplay risks or ignore warning signs, leading to business failures or other adverse consequences.
4. Stifling Personal Growth: Self-deception can inhibit personal and professional development by preventing you from acknowledging your weaknesses, learning from mistakes, and adapting to changing circumstances.
5. Missed Opportunities: By lying to yourself, you may overlook opportunities for improvement, innovation, or collaboration.
6. Impact on Well-being: Constant self-deception can lead to stress, anxiety, and burnout, as you're constantly trying to maintain a facade that doesn't align with reality.
As trite as that list might seem, it’s spot on. And, it tracks verbatim with my experience across 100+ investments. It also tracks with my own experience as an entrepreneur.
So, I don’t worry much about Sam Bankman-Fried level lies. I do worry about the slow and subtle ways that the suspension of disbelief can morph into a more destructive pattern of self deception, for all of us. I also worry that we who support entrepreneurs may encourage it, even if we don’t see it as such.
This dynamic may be one of the more existential parts of being a founder. But to make the thinking useful, I’ll try to end with one concrete suggestion for how to handle it: practice saying hard things. Make it a discipline. An exercise. Do it. Often.
Because I never miss a meal, I often tell new entrepreneurs to get comfortable serving up “truth burgers.” Burgers have layers. So does your company’s current status. Give the sizzle. Cheese me. Slather me in the secret sauce. But somewhere in the middle of all that gooey awesomeness, say something hard, even if it makes a single bite tough to chew.
You’ll be stronger for it longterm. You’ll attract people with whom you can build more authentic trust. People who can take the lows with highs, and do it all in stride. And with any luck, you’ll stay on the right side of the skinny line between fact and fiction.
RevUp Capital Managing Partner Melissa Withers is a bullish advocate for innovating the ways in which new companies are funded and supported. Beyond building new economic models for early stage investing, Melissa is also committed to directing more entrepreneurial funding to those underserved and overlooked by traditional VC.
More About RevUp Capital
RevUp Capital invests in B2B and B2C companies that are revenue-driven and ready to double down on growth. We deploy cash and capacity to help companies grow from $1-3M to $10-30M, quickly and efficiently, using a revenue-based model. Companies enter our portfolio with $500K-$3M in revenue, a strong growth rate, and a team that’s ready to scale. Our typical investment range is $300K-$500K.
We invest into a company's market-facing activity using a cash and capacity model. We pair our cash investment with dedicated support from the RevUp Growth Platform: a powerful resource to build a data-driven growth engine, delivered by people who get the work done. Rather than take equity, companies return investment through a small percentage of revenue over time. More at www.revupfund.com