The sound of one hand clapping:
1. Telling a customer you are busy--when you aren't
2. Telling a VC you have another term sheet -- when you don't
3. Telling an investor the round is 80% subscribed -- when it isn't
4. Telling a potential business partner you are close to signing with his competitor -- when you aren't
5. Telling an acquirer you have another offer -- when you don't.
Real Applause ("Bualadh Bos" in Irish, in case you wanted to know) sounds like this:
1. Being busy and prioritizing work based on customer criteria -- and raising prices
2. Having two termsheets and politely discussing the situation with each VC to seek not only the best terms but also the best relationship.
3. Having a round oversubscribed and allocating fairly to all participants.
4. Having a choice between two partner opportunities and working with each to understand the mutual benefits in each deal.
5. Having a choice between two acquirers and working to keep each party fully informed.The difference is not just integrity. The sound of one hand clapping always carries with it the potential for disasterous results, based on the lack of a real alternative in a critical situation. It is possible, I suppose, to cross a freeway blindfolded, but even if you've done it, it's a bad habit.
But, if you have worked hard to generate alternatives, then you are doing a great job leading your venture. And, in most cases, everyone will applaud your diligence and integrity in each of these situations. This is obviously a lot better than trying a shortcut based on illusion.
And, if you cannot generate appropriate interest from two - or more - parties, perhaps it might be time to ask why.