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Entrepreneurs by their very nature are typically optimists. You sort of have to be an optimist to start a new business, for obvious reasons.

Unfortunately, the odds are against you when creating a new company and there are many challenges that easily deter the cynical. For optimistic entrepreneurs, it's real easy to lie about the challenges and the state of a business.

Here are the 10 biggest lies entrepreneurs tell themselves:

We Have a Great Idea

It's hard for entrepreneurs to look at their business concepts objectively. And it's hard for the people they surround themselves with to do the same because friends, family and business associates rarely have the incentive or heart to tell them that their ideas are mediocre or need to be refined. If you believe implicitly that you have a great idea, when things don't seem to be going your way it's hard to take a step back and evaluate whether or not your idea was lacking in the first place.

We Don't Have Any Competition

I haven't yet run across a company without a competitor yet I've met plenty of entrepreneurs who will state with a straight face "We don't really have any competition". They really believe it. To their detriment, of course. Bottom line: if you don't think you have any competition, 99.9999% of the time you haven't looked hard enough.

The Competition Sucks

"We don't have any competition" is the first stage of competition denial. The second: that your competition sucks. That may be so but more often than not, this is simply an easy way of dismissing the risk posed by your competitors. Even in cases where the competition has an inferior offering, entrepreneurs don't like to grapple with the notion that capable competitors with inferior offerings could still potentially eat their lunch.

If We Build It, They Will Come

Marketing a new business is extremely hard. Getting customers, clients, users, etc. is something that even experienced entrepreneurs can struggle with. So instead of really focusing in on how they'll realistically acquire customers/clients/users, many entrepreneurs lie to themselves and put their faith in the idea that marketing will take care of itself. Today, this belief is often shrouded in talk of 'viral marketing'. If you're relying on 'viral marketing' to drive your business, beware.

Time Isn't of the Essence

Entrepreneurs often think that their window of opportunity is far greater than it really is. In reality, new businesses usually have a relatively short period of time to establish themselves. Even if you have all of the money in the world, in today's fast-paced economy, you can be sure that competitors, industry change and the dreaded 'business cycle' will eventually catch up. That's why you need to wake up every morning with a sense of urgency.

We're In Control

There are a lot of things entrepreneurs can't control. While you can't downplay skill, talent and relationships, I think there's a good argument to be made the success of most new companies actually boils down to things that entrepreneurs have little control over, such as timing. This shouldn't deter you when starting a business but pretending that everything is within your control can be very damaging.

It's Not the Product

You're having a hard time getting that first customer. Or maybe users aren't signing up for your new website. What's the reason? It could be a lot of things. Maybe you're not positioning your product correctly. Maybe you're not making the value proposition clear enough. Or maybe there's a flaw in your product. Most entrepreneurs don't like to consider that last possibility because it's the hardest problem for a business to fix. But if you're not doing as well as you had expected, ignoring the possibility that there's a problem with your product could be the beginning of the end.

We Project That...

It's important to project certain things when starting a new business. How much money will you need? How long will it take to break even? Important stuff to consider. But too many entrepreneurs come to look at their projections as fact when in reality, projections are usually way off. As a rule, you'll almost always underestimate the amount of money you need and the time it will take to break even and you'll overestimate how quickly you'll get your product built and acquire your first customer.

Somebody Will Want to Buy Us

When times are good, it's easy for entrepreneurs to convince themselves that they're working on something revolutionary that all of the big boys will want to acquire. But most new companies don't get scooped up for boatloads of cash so if you're not in it to win it on your own, you're playing to lose and might as well head to Las Vegas.

We Only Need More Money

If your company isn't doing as well as expected, it's easy to convince yourself that more money is the cure. But that's rarely the case. Just take a look at the shockingly-high failure rate for VC-backed startups. Millions of dollars of financing usually don't save them from the harsh truth: most new businesses fail and that isn't because all of them lacked financing.

Most good entrepreneurs are optimistic people. They need to be. But if your optimism leads you to look in the mirror and lie to yourself about the state of your business, it's time for a reality check. The truth shall set you free.

Photo credit: karindalziel via Flickr.

Patricio Robles

Published 12 June, 2009 by Patricio Robles

Patricio Robles is a tech reporter at Econsultancy. Follow him on Twitter.

2405 more posts from this author

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Nico

Funny ! Yes I DO recognize some of these ....

over 7 years ago

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Nigel Cooper

LOL... you're right of course, every entrepeneur does tell themselves all of the above lies... but they have to, otherwise they wouldn't be able to take the risks they do and take the plunge.

It's called self-delusion, and from experience, it's a very valuable tool for entrepeneurs as long as it's tempered with a healthy dose of realism along the way :-)

People often mistake pessimism for realism... long live the optimist (even if he or she is ever so slightly deluded :-)

over 7 years ago

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Faye Hawkins

All true! How about:

It's not a good idea to work round the clock - laptop glued under one arm, iPhone to one ear, tweeting thumb to keypad. Even if you are brilliant at what you do, the world won't miss you if you have a sleep. And, all being well, you'll be at your objective, energised best!

We already know it all - a frequent, and curious case of believing one's own hype! If you start a business, that's great. There's a world of difference between getting up and running and making some serious money. Don't forget anyone can be a CEO. Keep it real!

over 7 years ago

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Matt Chatterley

Brilliant.

So very, very true!

over 7 years ago

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Elizabeth Hodgson

Made me smile and weep (oh, how I weep) in equal measure... still, you simply cannot beat that irresistable feeling of "I'm creating something" when you are part of a start-up.

Ah yes, that heady feeling of not knowing if your professional and personal reputation is about to be ripped to pieces after years of hard graft shoved in some windowless office while living on the bread line. Bliss. (BTW I will breakdance not-very-well for food).

over 7 years ago

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Ben Heald

The point is though that to have the passion, commitment and belief that brings success to some entrepreneurs you have to tell yourself some of this stuff.  And also, there's nothing quite so motivating as being told you're going to be someone else's roadkill!

about 7 years ago

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Peter

I read your article, and as I did, slight daggers of pain punctured my very being with every sentence.  I have now worked for three 'entrepreneurs' and from all you write, so, so much of it true to my experiences, I actually thought it was a character study of the 'entrepreneurs' I worked with.  All of the above behaviours are driven from an un-healthy level of self-delusion, I found.  The one characteristic I failed to see in each 'entrepreneur' I worked with was well reasoned decision making.  So much of it was 'high energy shooting from the hip' and 'gut feel let's go this way' that solid, grounded lessons could not be laid down and followed - 'cause if it didn't work' then 'quick, change try something else' was often the strategy.  In a need to constantly 'move forward' there was seldom anytime (nor value given) to sit for a second and think.  If this was suggested, then the super empowering thought of 'don't be a No person' was provided as a response.

The thing to also note is that the self-deluded nature of 'entrepreneurs' largely means they leave a path of detritus and destruction behind them which they fail to see.  One 'entrepreneur' spent 3 years, 1.5 million pounds of people's money to build a technology platform and never built a single thing.  However they were 'great at the PR story' great at the 'creating amazing visions for the future' but just crap at the not so fun things like listening to others; taking constructive criticism about the product; being realistic about competition and being realistic about projections.  This same 'entrepreneur' burnt through over 20 relationships (all ex-employees) not empowering a single one, nor keeping any as friends (many of them brilliant individuals).  The aftermath, and drop out-zone of this self-delusion is so much greater than just the pounds wasted - but, the self-delusion doesn't allow that to sink in.  I read comments above like:

"People often mistake pessimism for realism... long live the optimist (even if he or she is ever so slightly deluded :-)"

And cannot help to think yes, but at what total cost to others?

over 6 years ago

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