In July 2011, a 27-year-old Stanford dropout secured a 10-minute slot with George Shultz at the Hoover Institution. The meeting ran two and a half hours. Before the month was out, the former secretary of state had joined the Theranos board, won over, he told Fortune, by her “purity of motivation.” Nothing said in that room could be tested.
Across the country, Katalin Karikó had the opposite problem. She had spent years at the University of Pennsylvania producing evidence that messenger RNA could be modified to slip past the body’s immune alarm. Penn demoted her in 1995 after her grant applications kept failing. The 2005 paper that would later win her a Nobel Prize drew, in her words, no interest.
One had a story and no proof. The other had proof and could not get the room.
I have spent decades on the investor side of that table: in banking, inside a global corporation and later running an asset manager in Hong Kong. Founders arrived with more evidence than any committee could digest: patents, market studies, customer logos, 30-page decks. The uncomfortable pattern was that the weight of the evidence rarely decided whom I wanted to see a second time.
The research suggests I was typical. When Paul Gompers and three co-authors surveyed 885 venture capitalists for the Journal of Financial Economics, 47 per cent called the management team the most important factor in a deal; only 37 per cent put business model, product or market first. DocSend’s data shows investors spend under four minutes on a deck. And decades of deception studies, as Timothy Levine has documented, put human accuracy at telling truth from lies at about 54 per cent, a shade better than a coin toss.
The con man grasped this long before venture capital existed. In 1849 the New York Herald reported the arrest of William Thompson, a genteel stranger who struck up conversations on Manhattan streets, then asked whether the gentleman had confidence enough to lend him his watch until tomorrow. Many did, assuming he was an old acquaintance they had forgotten. The paper called him the “Confidence Man.” Thompson carried no evidence at all. He supplied familiarity and let his victims supply the rest.
Also Read: Asian investors aren’t choosing between crypto and TradFi anymore
A century and a half later Rudy Kurniawan, a young Indonesian in Los Angeles, added the missing piece. He poured rare Burgundy for America’s most seasoned collectors, who nicknamed him “Dr. Conti,” and in 2006 an auction of his cellar fetched a record US$24.7 million. Many bottles had been refilled with cheaper wine at his home. The evidence sat in the glass, and the experts drank it.
That is the sequence investors actually run: attention, then recognition, then trust, then a hypothesis, and only then evidence. Within minutes, it takes shape: this founder may be exceptional. What follows is often read as confirmation. Evidence does not create attention. It validates a belief already forming.
Founders, especially technical ones, get this backwards. They treat the first meeting as compressed due diligence, and it is not. The investor is deciding whether there is a hypothesis worth diligencing at all, and a patent cannot do that job. Neither can a TAM slide or a customer list. They answer questions the investor has not yet decided to ask. The failure is sharpest in Asia, where many of the strongest companies build things that take a paragraph to explain: surgical robots, diagnostics, industrial software. By slide 14, a verdict has formed, and the remaining slides rarely overturn it.
The first meeting and diligence do different jobs. The meeting answers why should I care? Diligence answers why should I believe you? Founders who spend the first meeting on the second question seldom reach the second meeting.
Also Read: Why Singapore investors hold more Apple than Singtel, and why it should worry you
The con artist exploits the same gap from the other side, corrupting evidence after belief has formed. Charlie Javice told JPMorgan her student-aid startup, Frank, had 4.25 million users; it had about 300,000, and prosecutors said she paid a college friend US$18,000 to fabricate the rest. The bank paid US$175 million anyway; the judge who later sentenced her said JPMorgan had “a lot to blame themselves” for.
I met Gibran Huzaifah in Jakarta in eFishery’s earliest days, and have written about him before. His story was among the best in Southeast Asian venture: a small-scale fish farmer whose smart feeders would modernise Indonesia’s ponds. It carried SoftBank, Temasek and Malaysia’s public pension fund KWAP to a US$1.4 billion valuation. A forensic audit later traced two sets of books back to 2018; for the first nine months of 2024, eFishery reported US$752 million in revenue against roughly US$157 million in reality. Neither Frank nor eFishery lacked sophisticated investors or due diligence. Fabricated numbers survived both.
Even inside Theranos, evidence lost to belief. When Tyler Shultz told his grandfather the lab’s technology did not work, the statesman sided with Holmes. “He didn’t believe me,” Tyler later told NPR.
The same psychology demands opposite discipline from each side of the table. Founders must earn attention before they offer proof. Investors must doubt hardest at the moment attention turns into belief. The better the story, the more dangerous ordinary diligence becomes. Levine’s own work points to the fix. In one 2014 experiment, five experienced US federal agents allowed to question subjects freely identified deception correctly in 87 of 89 interviews. Don’t read the founder better. Change how you test the claim.
The lesson is not to imitate the con. It is to understand the sequence it exploits. A con artist asks you to believe before you verify. A weak founder asks you to verify before giving you any reason to care.
Karikó’s evidence found its audience. It took a pandemic.
Look at your deck. How many of its slides answer a question no investor has yet decided to ask?
—
Editor’s note: e27 aims to foster thought leadership by publishing views from the community. You can also share your perspective by submitting an article, video, podcast, or infographic.
The views expressed in this article are those of the author and do not necessarily reflect the official policy or position of e27.
Join us on WhatsApp, Instagram, Facebook, X, and LinkedIn to stay connected.
The post Why con artists get the meeting that honest founders can’t appeared first on e27.