This is part of my Series on Entrepreneurial Culture.
I'm going to begin this post by asking a few questions.
How many people do you trust completely? For many I would guess this group would include your "inner circle"- comprised of your spouse, parents, siblings, grandparents and a handful of close friends. (This is obviously a gross generalization and varies enormously).
Let's get more specific now for our purposes. How many of the people you do business with do you trust completely?
If, for example, you are an entrepreneur- do you completely trust your cofounders, other teammates, your earliest investors, your VC's, your attorney? Do you trust yourself? What are the gradations?
How important should trust be to an entrepreneur?
If you're an investor, do you completely trust your partners, your portfolio company CEO's, your LP's, your associates and principals? What are the gradations?
How important should trust be to an investor?
I would bet that in both contexts there's a scale here that goes from "complete trust" to "trust somewhat" depending on the person in question and the personalities involved.
I've been thinking a lot about Trust lately for a variety of reasons. Let me quickly list them:
- An entrepreneur I know was recently betrayed and had the rug pulled out from under him without warning by his "close friend" and business partner of the last five years
- Some entrepreneurs I know were openly talking about taking some "dumb money" from some investors they obviously don't respect (let alone trust)
- Some investors I know started playing silly games with entrepreneurs they invested in, rather than shoot straight
- I've come across VC's who take information from entrepreneurs they have no intention of investing in and then pass that information on to portfolio companies of theirs, friends of theirs, or competitors of those that pitched them
- I regularly see materials I shouldn't be seeing. In other words, materials I haven't asked for often get forwarded to me via email for "my opinion" (or whatever else), wherein the original sender was obviously operating on the understanding that the first recipient would not forward that information to anyone else. I am regularly that "anyone else". I'm sure lots of you receive this sort of information. I am consistently shocked by what people mindlessly (or purposely) forward to others
- I know an entrepreneur who took angel money from myself and a number of others perhaps 8 years ago and has in recent years gone radio silent. He won't update his own investors nor return emails and calls
These scenarios above obviously vary from relatively minor violations of trust to massively egregious ones. Collectively though, they force you to address the core issue.
What are your thoughts about Trust? Obviously we live in a complex world and one cannot trust everyone with whom we do business. There are gradations of trust and there are no doubt continuums that range from complete trust to none at all.
Who do you need to trust completely? Where is a lesser standard appropriate?
I'd love to hear your views about these nuances. Please leave comments and contribute to the discussion!