The acceptable way to lie in business

Be aspirational, not delusional

👋 Hi, it's Greg. I’m lecturing on AI as an Advanced Thought Partner for Personal Math subscribers on April 17. Sign up for free.

We’re living in post-truth times, especially in politics. Trump’s chaotic executive orders haven’t reduced the price of eggs, but no problem – he insists prices are down 59 percent anyway.

The current mantra in Washington is: If something didn't happen the way you wanted, just say it did.

It doesn't work that way in business. Marc Andreessen might be okay voting for someone who can’t stop lying. I guarantee he wouldn't tolerate it from the CEOs of his portfolio companies.

But I can see how young entrepreneurs start dancing with the truth. They look at competitors hitting milestones that seem implausible, they're scared to have tough conversations with their board, and they've bought into the "fake it till you make it" ideology. It’s how you get examples like Charlie Javice, the former fintech star who was convicted last week for faking four million clients to get acquired by JPMorgan.

As a business leader, you need to be able to do two things: set an aspirational target to attract capital, resources, talent, etc. And be unfailingly honest to your board, investors, and team members – even when the two narratives don’t exactly match.

Here’s how to tell the difference.

Greg

Marketing claims vs. business metrics

Any time I talk to a startup (as a potential partner, vendor, etc.), I assume their marketing numbers are 12 months ahead of reality – or that they’re showing me the most generous interpretation of a metric (e.g., “user” means “logged in once”).

This is what 99% of startups do. It’s “Silicon Valley storytelling,” and it’s necessary to compete. At Section, I talk a lot (internally and externally) about bringing 1 million people into the AI class. That’s my aspiration – but it’s not my business plan. I may talk about it to the board, but I don’t tie revenue targets to it or commit to it by the end of 2026.

Young or inexperienced leaders get in trouble because they don’t separate the aspirational targets from their business targets. Here’s what usually happens:

1. Start with a genuine ambition – “We’re going to revolutionize financial aid for students”

2. Set aspirational goals – “We’ll have 5 million users”

3. Get some positive feedback (from investors, stakeholders, employees, etc.)

4. Start to imagine what would happen if they actually hit that plan – fundraising, reputational gain, guest on All-In podcast, etc.

5. Build the business plan around the aspirational metrics instead of the realistic ones

6. Reality isn’t cooperating

7. The fateful choice – fudge or exaggerate the numbers and continue the charade, or have a hard conversation that compromises the dream

What boards won’t tell you: It’s good enough to be on track to hit an ambitious but realistic plan. No one expects you to do the impossible. Set an ambitious plan but don’t bring the plan forward unnecessarily. Be aspirational, not delusional.

The playbook for managing ambitious plans

1. Separate aspiration from the plan. Be explicit about the difference between your vision and your promises. I do this with my board at Section for ProfAI: I show three core metrics (revenue, customers, users) and offer forecasts for each. If one doesn’t materialize as planned, I might downplay its importance … but I never fake results.

2. Create truth-telling spaces. Have regular meetings with your leadership team (or at least part of it, like your CFO) where brutal honesty is the only currency. If you can't face reality with your inner circle, you're in trouble.

3. Reveal truth at the midpoint. If you've overpromised and need to correct expectations, do it halfway through your timeline, not at the last possible moment. If the window to deliver bad news is a month, you deliver it in the middle of that month. This gives your stakeholders time to adjust without feeling blindsided.

4. Draw hard lines around certain numbers. Marketing claims can have aspirational elements; financial and operational metrics must be sacred. Pick the metrics and insist that the definitions of those metrics don’t change, and that the tracking is consistent over time.

5. Identify your breaking point in advance. What's the moment where you might be tempted to cross the line? An acquisition opportunity? A crucial fundraise? Identify these pressure points and create a mental guardrail before you reach them. Or lean on your spouse/partner, mentor, or coach to hold you accountable to the facts in those moments.

My advice

We’re living in a moment where outright lying works more than it should – at least it gets you elected. But in business eventually these chickens come home to roost.

If you’re not having the success you want, and your narrative starts to deviate from the facts, you have a choice. You can either change the narrative, or change the facts.

I know it’s hard to change the narrative (aka go back to the board and say, “We aimed for X million, but the market isn’t responding how we’d hoped”). But it’s a hell of a lot better than changing the facts … and will cause you way fewer sleepless nights.

Have a great week,

Greg

P.S. I’m lecturing on AI as an Advanced Thought Partner for Personal Math subscribers with my brilliant friend and colleague, Lucas Miller, on April 17. Sign up for free.