Patti-Stanger Jill Duggan

Fake tits and money

In the spirit and language of Millionaire’s Club matchmaker Patti Stanger from the Bravo TV hit show “Millionaire Matchmaker” I want to re-emphasize how important it is for entrepreneurs to raise quality money.

I hit on that subject before in “Why VC is such a bad date” but the recent demise of yet another innovative company held hostage by the wrath of so-called quality investors makes me want to re-emphasize the importance of finding the right investor to entrepreneurs even more aggressively. And I figured the catchy title of this article would help me with that.

Drawing an edgy parallel can be a dangerous one, not in the least because some women choose breast augmentation to cover up the impact from invasive surgery. Clearly this article and its analogy does not reflect those women.

 

Fake money

Early stage Venture Capital investors who invest less than $500K in entrepreneurs to find the innovation that will bring them extraordinary riches are like women who put down $5K for breast augmentation with the hope it will yield them the confidence and attention to set them up with a well-to-do husband for life.

The short-sighted interpretation of that investment scenario would suggest there is nothing wrong with investing about $500K in a startup company, in the same way there is nothing wrong with a woman going out of her way (literally) to look her best for $5K. Nor would there be anything wrong with a rich man attracted to a “well-rounded” woman, because it is simply in The Naked Ape‘s nature. And thus there would be nothing wrong with a startup company taking any money it can to produce promising upside returns.

 

Fools of nature

However, startups that take a little bit of money from just about any investor are like men who pick women for the size of their breasts. Investors who gamble tiny bets on innovation are like artificially inflated women playing hard-to-get to win big. But both are fooling nature.

Women with large breasts (according to Desmond Morris) evoke in men a natural and animalistic response, as they (unconsciously perhaps) signal a sublime state of health and a calling card to mate. Men who have achieved riches signal dominance, freedom and determination which in turn (unconsciously perhaps) attracts women. One ought not contest the laws of nature.

However, virtually any woman who has held a job for a year can buy herself a pair of implants, and any man who has been somewhat successful in business, or rode the technology gravy train long enough, can flaunt a half a million in “confidence”. But fake boobs and fake money hide the true genetics of their carriers.

The damage is done when many men find out that after years of marriage, not a woman’s boobs but her personality survives the test of time. And women find out that no amount of money makes them happy but their sense of self worth.

So, it is only a matter of time before genetics come calling.

 

Fools of innovation

Subprime investments, such as the uniform deployment of the $5K and $500K “investments” mentioned earlier, can by economic principle only generate subprime returns. Put differently, there are no shortcuts in life. And entrepreneurs who take anybody’s money to further their cause, will soon discover that an investor with money but without the merit and ability to accurately judge how to cross the chasm, is the ball-and-chain in their inevitable demise.

The damage is done when many investors find out that after years of investing, not the amount of money-in but the appropriate deployment of upside-risk survives the test of time. And startups find out that not the money from an investor counts, but the dogged pursuit of their own unique vision.

It is only a matter of time before economics come calling, and in light of 99.4% failure rate of investment firms, can we all agree that time is here?

 

Failure multiplied

A woman who picks a man for his money deserves a man who picks a woman for her boobs. Either party is doing their best to try and make a better life for themselves. In the same way a subprime investor has a real desire to trickle money into a startups that desires to take it. Neither party can be blamed for their individual desire.

But they should both be blamed for portraying somebody they are not.

The problem is, the man with fake money and the woman with fake boobs should have never consummated the relationship – and worse – produced a child. Only to later act surprised that their child, unable to fend for itself, has suffered most from the dysfunctional relationship. In the same way we all act surprised that the “children of innovation” we produced are responsible for negative 10-year returns to Limited Partners (the real investors in Venture Capital) and the many desperate IPO bubbles they produce.

The problem is not our economy, but our lies.

 

Lies kill

I feel sad for another innovative idea that has just bitten the dust because of the flawed marriage between investor and entrepreneur, with the same amount of sadness I see so many children of divorce suffer from how we set things up wrong from the start.

The power of change lies in the hands of those who dole out money. And merit based upside investing will attract entrepreneurs with a more authentic and meaningful differentiation.

The death of another startup (a child from a dysfunctional marriage between investor and entrepreneur) continues to drive me to fix the economic foundation, that is responsible for the perpetuation of foolishness and lies in the innovations business. For I have seen, believe in and cherish the innovative capacity in this country.

The question I leave you with is; why does a country often quoted as the most free country in the world, depends on – and protects – the perpetuity of such grandiose lies?

Maybe, just maybe, we are not as free as we think?

 

2 replies
  1. Brian
    Brian says:

    “lies” infer an awareness of self-deceit.  I don’t see this pattern based on lies so much as a lack of true Self-Value and the distinctly different perceptual orientation this engenders. A change in this perception, that of one’s more innate and more healthy purpose-driven “Self” can only be created (for those of us who have lived with the mis-alignment of self-preception for years if not decades)  by a good ‘ole heart attack or stroke, both figuratively and, unfortunately, literally. Without the visceral drama of a life-affecting event adults simply don’t change their perceptual and therein behavioral patterns and decisions – including our cognitive assessment of value as applied to investing on one side and attraction to money on the other. 

    Reply
    • Georges van Hoegaerden
      Georges van Hoegaerden says:

      Lies can be conscious or not, but either one creates the same problem. We proclaim to be free, yet few of our economic constructs deliver the proof we are. Our economic systems are not free-market systems and claiming the opposite is the biggest lie to our constitution and ourselves. For most that realization is still in a highly unconscious state.

      Best,

      Georges

      Reply

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