Wednesday, May 4, 2011

Beware of Myths

Some years ago I shared a house with a group of day-traders. They operated on the NASDAQ every week day, playing the day trading game remotely. The deal was they traded and received payment for profits they generated and the number of transactions they made - they company providing the system and the funding took a percentage of profits and cut them off when losses where too high. Most days these guys lost money, occasionally they made some. I became interested and realized that there was an entire industry of websites, books, DVD's and training around how to make money. I kept hearing about this "one" guy who was making a fortune. Each day there were new stories of the heroics of this individual.


I began thinking, if I was recruiting day traders and building an industry around the promise of riches, what would I do ? The answer of-course is "I would create a myth" - create some super-hero figure who achieved magical results and all those that follow aspire to be and be like. Now I do not have proof that this guy does not exist or even that he does not exist in the way made out, but I am reasonably sure the stories of his gains are not wholly true.

Recently, having been to a number of events in the UK (London) start-up community, I see the same or similar myths being used to create a booming industry around the promise of start-up riches. While I think there is a lot of great work being done, there is also a cult-like hype that simply is misleading, dishonest and a form of profiteering. Whilst I do not think that the people running most of these companies are dishonest ( I believe they think they are doing a good deed ). Prospective entrepreneurs (myself included) should be very weary. There are too many buzz words, to many recopies for success and far too many myths !

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