Through an understanding of the science behind human behaviour and emotion, it is possible to assess a person’s proclivity for lying and dishonesty. Psychological assessment can be a valuable tool for mitigating risk and ultimately revealing how a founder behaves in certain situations and how they think under pressure.
Here are five simple ways to identify Mendacity in a company founder.
They Avoid Tough Questions
When asked tough questions, do they dodge them or give evasive answers? An honest person will take responsibility for their actions and answer questions with clarity, whereas someone who is hiding something may try to avoid giving direct answers or deflect blame onto someone else.
Their Story Doesn’t Add Up
Do their claims add up? Do they have data to back up their claims? Does their background check out when you look into it further? If not, then this could be a sign of mendacity.
They Constantly Change Their Plans
Are they constantly changing their plans due to “unforeseen circumstances” or “market conditions”? This could be indicative of someone who is making things up as they go along rather than having a well thought-out strategy for success. It could also mean that the founder has ulterior motives for changing their plans without proper justification or explanation.
Their Behaviour Is Unusual
Are they acting unusual? Are they overly friendly (to the point of being insincere) or overly aggressive (to the point of being intimidating)? Both these behaviours could indicate that something isn’t quite right with the person in question.
They Make Unrealistic Promises
A founder who is not honest will often make grand promises that they can’t possibly keep. If they talk about having a “revolutionary new product”, but do not support claims with evidence of it being developed or tested, then it could be a sign of dishonesty.
Being able to accurately detect lies and dishonesty from founders will help investors make informed decisions about which companies they can trust with an investment. With the right tools and approaches, available through psychological assessments, investors have an improved chance of avoiding mistakes due to deception from company founders.
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