In today’s society, there is a growing emphasis on authenticity and embracing vulnerability, even in professional settings. While it may be seen as a sign of weakness to show imperfections, recent cultural shifts have highlighted the importance of being genuine and open about personal struggles. However, this trend may not always be applicable in every situation, especially when it comes to entrepreneurs pitching their ideas to potential investors.
A recent study by Howe and Menges (2025) delved into the impact of entrepreneurs disclosing their personal flaws to investors. The research revealed that only certain types of vulnerabilities, such as a lack of freedom of choice or feelings of inferiority, could be beneficial in creating a sense of psychological closeness with investors. By sharing these specific struggles, entrepreneurs were able to connect with investors who saw similar traits in themselves, leading to increased investments or, at the very least, no negative impact on investment opportunities.
It is crucial to note that this strategy only proved effective when disclosing inferiority-related flaws. In contrast, revealing superiority-related flaws, such as arrogance, did not yield positive results and could potentially deter investors. The key takeaway is that entrepreneurs should carefully consider their audience and the potential for shared vulnerabilities before deciding to disclose personal imperfections.
Based on the findings of the study, there are three important considerations for entrepreneurs navigating the decision to reveal personal flaws to investors:
1. Error disclosure can be beneficial if there is a chance of shared vulnerabilities with the audience, particularly when disclosing struggles related to feelings of inferiority.
2. Sharing flaws associated with excessive freedom of choice or superiority does not offer clear benefits and may even harm the entrepreneur’s chances with investors.
3. Entrepreneurs should approach error disclosure cautiously and only do so if they believe it will resonate positively with their audience.
In conclusion, the decision to disclose personal flaws as an entrepreneur can be a strategic one, with potential benefits in creating a sense of connection with investors. However, careful consideration of the type of vulnerabilities shared and the audience’s receptiveness is crucial in determining the effectiveness of this approach.
Source:
Howe, LC, & Menges, Ji (2025). Pitch Imperfect: How investors respond to disclosure of entrepreneurs of personal defects. Organizational behavior and human decision processes 186, 104388.
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