Why Fake It
'til You Make It is Finished
You
are going to be confronted by grim business realities at some point. You can be
prepared. Or you can be Theranos.
Executive director, Ed Kaplan Family Institute for Innovation
and Tech Entrepreneurship, Illinois Institute of Technology
I've spent the last two weeks in and out of several hospital
labs getting countless blood tests to try to figure out what kind of infection
has been dogging me for months. I've been struck, or maybe stuck is the
better word, by three things:
(1)
Drawing blood is a repetitive process, which nonetheless has to
be done carefully and well every time, because it's the investigative
foundation of the medical help that follows. The people who do it day-in and
day-out are some of the most caring and professional people around.
(2)
It takes a LOT of blood to accurately run these diverse tests
and panels. Which leads us to Theranos, of course, the subject of Alex Gibney's
documentary on HBO (The Inventor: Out for Blood in Silicon Valley).
Anyone from Walgreen's senior leaders to the hundreds of other Theranos
enablers who thought that complex blood chemistry analysis could be handled
with a simple pinprick of blood were dumb money, not to mention greedy and
arrogant. (It's worth noting that Inc. Magazine was among many in the
media taken in by this too-good-to-be-true-tale.) They all claim to have been
flimflammed by a college dropout and her secret boyfriend who produced
false/curated results that have collectively shaken our confidence and comfort
in the integrity of a blood testing system that we have all relied on for
decades.
(3) It's clear, as you sit
watching other sick and scared people praying for good results, or at least
some guidance about the right treatment, that these Theranos parasites
jeopardized the health and potentially even the lives of thousands of
unsuspecting patients--all, in my opinion, in their vain and venal race to
raise and spend as much money as possible. Not, by the way, to develop their
phony technology but to buy props, pawns and sycophants and to party, promote
and publicize their lies before the world eventually caught on to their frauds.
I've
come to the sad realization that there really are irredeemably broken and
fundamentally evil people in this world like Elizabeth Holmes, the booted and
indicted Theranos CEO. As the documentary points out, there was no science, no
support, nothing, but stealth and secrecy and a house of cards. Just full-speed
ahead and ignoring/suppressing all the contrary facts, the sound questions and
concerns, and the regulatory inquiries, as weak and ineffective as they were.
And,
when they are caught out, these are the very people (along with their VC and PE
enablers and media pals) who rush to hide behind the mantle of "faking
it" for a while as if this shibboleth will excuse even the foulest
behavior. The truth is that they (and believe me she's not alone) put
their greed ahead of the health, lives and futures of more patients than we
will ever know for certain. Another not too distant example was the Snap guys, who in the early days deceived
users, according to a Federal Trade Commission settlement consent order.
Had
Holmes and her boyfriend simply duped a bunch of stupid old white men - driven
and blinded by their own demons and willfully oblivious-and a few market
watchers like Jim Cramer, maybe you might say that they got what they deserved.
Certainly, she made fools out of plenty of media people and frankly it's hard
to watch Cramer in the emerging docs fawning over her startup/entrepreneurial
clichés about the struggle and fighting the good fight long after the game was
over.
But
sadly, the damage and the impact of her deceptions are much more extensive and
far-reaching. She is the latest and, I would argue, most despicable example of
the Silicon Valley belief that it's perfectly fine to "fake it" for a
while until you "make it". It's okay because it's something that
they apparently believe that we ALL do to varying degrees. Everyone in the
startup world suffers from impostor syndrome to some extent, so don't be such a
stickler for the rules. The only real sin is getting caught out too soon.
These
are completely flexible and relativistic visions of truth and honesty. Tell 'em
what they want to hear. A little inaccuracy saves a ton of explanation
especially when the Empress has no clothes to show for hundreds of millions of
dollars that are now long gone. I wrote about this problem with situational ethics a
while ago.
And so,
it's ultimately left to us to try to explain why these things continue to
happen and how we can put an end to the most grievous examples and encourage
our new entrepreneurs to do the right thing. It begins with the idea that,
however fast a talker you might be, you can't talk yourself out of problems
that you behave yourself into-- or dig yourself out of holes that you keep
digging deeper. As everyone knows, most people are far more interested in what
you actually do rather than what you say you're going to do. Results, not
rationalizations. Execution not excuses or painful explanations. It may start
with a story, but it needs to be grounded in substance sometime soon.
But,
even with that being said, there are still a number of recurring situations
that every entrepreneur faces in the course of his or her journey. How
you handle each one may differ under the circumstances, but there's always a
right way and the ability to recognize and prepare for these bumps in the road.
To know your own best self and how you should handle the situation
is a clear advantage.
So,
what can you do, as either the truly interested observer who sees the train
wreck coming and wants to politely offer advice, or as the entrepreneur who
needs help to put guard rails in place and maybe a reminder or two to help keep
things in some kind of perspective while the whole world seems intent on making
that impossible?
There
are basically four beliefs--call them delusions if we're being honest-- that
entrepreneurs talk themselves into as justifications for all sorts of bad
behavior. Just like getting over the idea that "faking it" is fine,
we need to put all of these crutches in the trash as well.
1. The Mission Trumps the
Morals
The
"work" is so terribly important, underappreciated and world-changing
that the ends justify whatever means are required to get there. The truth is
that most of us aren't curing cancer this week and, even if we are, it's still
no excuse for cutting corners, lying or getting things almost right and letting
the chips fall where they may.
2. I'm
a One Man/Woman Army
The
same positive qualities and emotional strengths that make for a great
entrepreneur can sour rapidly and devolve into many excesses in the wrong
direction. The beliefs that the world and all the responsibilities for
everything in the business are heaped on your shoulders and that you've got to
do it all alone are just as isolating and destructive in tough times as they
are stimulating. No one can do these things all by themselves today; asking for
and getting help is a critical step in staying on the right path.
3. The Bad News Will Get Better Any Day Now.
Ignoring
or concealing the mounting woes in the hope that they will disappear or that
salvation is right around the corner is a gambler's disease. Playing one more
slot machine or a "last" hand that you can't afford at the poker
table is a sign of desperation-- not smart decision making. It's one of
those things that you know is wrong but can't bring yourself to stop. Bad
things in new businesses don't ever get better by themselves; bad facts
don't improve, they fester and get worse until you do something about them.
4. I Can Get It Done with Duct Tape and
Chewing Gum for Now
Makeshift
solutions and quick, half-baked fixes only deflect attention and resources from
necessary and inevitable solutions to the real problems. Piecemeal patches,
trying to do things cheaply that you shouldn't do at all, and badly compromised
choices are all bad bets on a future it's unlikely that you're ever gonna see.
There are no simple answers, but shortcuts are always the wrong way to go.
The
bottom line isn't easy or pleasant. No one really likes surprises (especially
boards and investors) and surprises in the startup world are never symmetrical --
they're virtually guaranteed to be bad news. In addition, no one wants to be
the bearer of bad news or say what no one wants to hear. But it's what you
signed up for as the CEO and every alternative leads to worse lies and bigger
problems.
It's
very difficult to admit that you've been wrong or stupid or made horrible
mistakes. But it's all easier in the long run and better for all concerned to
be regarded as foolish or inexperienced or even "not up to the job"
than to be known as a crook and a thief for the rest of your life.
