<story><title>Theranos, CEO Holmes, and Former President Balwani Charged with Fraud</title><url>https://www.sec.gov/news/press-release/2018-41</url></story><parent_chain><item><author>abalone</author><text>&amp;quot;Fake it til you make it&amp;quot; generally refers to acting like you believe in yourself even if you&amp;#x27;re filled with self-doubt. Not actual fraud.</text></item><item><author>ChuckMcM</author><text>Ok, this is the money line in that press release for me:&lt;p&gt;&lt;i&gt;“The charges against Theranos, Holmes, and Balwani make clear that there is no exemption from the anti-fraud provisions of the federal securities laws simply because a company is non-public, development-stage, or the subject of exuberant media attention.”&lt;/i&gt;&lt;p&gt;For all those entrepreneurs are trying to &amp;quot;fake it until you make it&amp;quot; be aware that the SEC considers your strategy both fraudulent and they feel they have the jurisdiction to prosecute you. And while I doubt the SEC is going to go after every CEO that raised a Series A on a pitch deck that was pure fantasy, the people who participated in the round might bring them in if it served their purposes.</text></item></parent_chain><comment><author>ChuckMcM</author><text>As with anything there is the way in which something is offered and the way in which it is consumed. I have encountered &lt;i&gt;many&lt;/i&gt; people who have internalized &amp;quot;fake it&amp;quot; to mean &amp;quot;pretend that you are hitting all your milestones and you executing against your plan&amp;quot;. These folks see this as a way to keep the questions of why they &lt;i&gt;aren&amp;#x27;t&lt;/i&gt; actually doing all of that at bay because later when they are &amp;quot;making it&amp;quot; those questions will be irrelevant.&lt;p&gt;For example you lie about how your marketing efforts are reaching customers who are signing up in droves while you use mechanical turk and other techniques to make the observable metrics go up. At some point your visibility reaches the point where you actually &lt;i&gt;are&lt;/i&gt; reaching your customers and so you can stop doing the shady stuff.  By doing this you avoid the inefficiency of the whole &amp;quot;we aren&amp;#x27;t sure you can do this&amp;quot; discussion which helps no one.&lt;p&gt;On the outside, one clean narrative, traction and growth from day 1, now a multi-million (or billion) dollar business. Or as my Grandfather would say, all yummy sausage and no discussion at all about what not-yummy things are in there too.&lt;p&gt;Everyone should believe in themselves. That is just a given, if you don&amp;#x27;t (or can&amp;#x27;t) then you won&amp;#x27;t reach your expectation. There isn&amp;#x27;t any &amp;quot;faking&amp;quot; there as far as I can see (unless it is suppressing your own doubts about the effort).</text></comment>
<story><title>Theranos, CEO Holmes, and Former President Balwani Charged with Fraud</title><url>https://www.sec.gov/news/press-release/2018-41</url></story><parent_chain><item><author>abalone</author><text>&amp;quot;Fake it til you make it&amp;quot; generally refers to acting like you believe in yourself even if you&amp;#x27;re filled with self-doubt. Not actual fraud.</text></item><item><author>ChuckMcM</author><text>Ok, this is the money line in that press release for me:&lt;p&gt;&lt;i&gt;“The charges against Theranos, Holmes, and Balwani make clear that there is no exemption from the anti-fraud provisions of the federal securities laws simply because a company is non-public, development-stage, or the subject of exuberant media attention.”&lt;/i&gt;&lt;p&gt;For all those entrepreneurs are trying to &amp;quot;fake it until you make it&amp;quot; be aware that the SEC considers your strategy both fraudulent and they feel they have the jurisdiction to prosecute you. And while I doubt the SEC is going to go after every CEO that raised a Series A on a pitch deck that was pure fantasy, the people who participated in the round might bring them in if it served their purposes.</text></item></parent_chain><comment><author>matte_black</author><text>You can believe in yourself without faking anything, and it’s healthy to do so.&lt;p&gt;Faking it implies you want to give others the impression you’re already a big shot, and it dilutes out the accomplishments of people who &lt;i&gt;actually&lt;/i&gt; made it.&lt;p&gt;The downside should be that if you’re faking it and you don’t make it, your shame should be relentless and brutal, and no one should ever take you seriously again. Also, even if you make it you will feel alone and empty in your success, because everyone will have long thought you already “made it” and you have to continue hiding your true story. There is no one to celebrate with except those who are also in on it.&lt;p&gt;Where as if you would have just been humble and true to where you currently are, people have headroom to express sympathy and support should you encounter a setback.</text></comment>