An article in the New York Times picked up on this topic.
https://www.nytimes.com/2023/04/15/business/silicon-valley-fraud.html
I am hearing it very often here in Switzerland and in Europe when I bring up the wide gap in venture funding to the US:
"But they often only fake it."
It is true that there have been some highly visible fraud cases such as Theranos and FTX, and in both cases top venture capital firms had invested.
"Fake it until you make it" is indeed also a common term and sort of legitimate one which describes a very normal step in the life of a startup: the product/market fit.
Of course during this period you also must raise money and look good so it is normal that one is over-optimistic and must be to have any chance to raise funding.
Now there is a clear line of course between hyping up a business idea while in fact still looking for a product/market fit and outright fraud.
Investing in startups is a risky process and at times chaotic. Then the 1 in 10 rule also applies so lots of pivoting and failures are needed before striking a big hit.
What I think can definitely be improved though is the use of data and best tools like KPI dashboards to show the history of a company and also make pivoting measures plausible and also controlling what is going on easier.
Where I do not agree though if Europe is taking such stories as sort of justification why e.g. Germany has 450 times lower venture investment per capita than Silicon Valley.
Zero or much less invested in will not suddenly lead to much more.
To do it more efficiently AND also go after the BIG opportunities is an opportunity though.
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