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Empty Suits
Fred was excited to make his pitch to some angel investors; but he felt a bit uneasy because although he had used the terms team and we throughout his business plan, he was the only one involved in his venture. He had not yet been able to attract any members to his team, but he had had several conversations with prospects. His personal contact in the angel group told him that his venture was likely to be funded, but there would be considerable focus on his team; a lot was riding on the meeting. For the presentation to the group he had four of his best friends, not at all connected to the business, dress in their best business suits, accompany him to the presentation, take seats in the back of the room, and say nothing. He hoped to make the impression that he had a team. He did a great job in the meeting, and his “team” filed out after him.
Questions
Was Fred being ethical? Why or why not? How should he have handled the situation? What are the implications and lessons from your discussion of the case? What role do ethical issues play in forming a team, selecting advisors and investors, and other entrepreneurial activities?
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