Optimist or opportunist?

Peter Maenhout (Gimv) on the financial tension between entrepreneurs and investors

Recent research by Veroniek Collewaert, Professor of Entrepreneurship, has shown that entrepreneurs’ over-optimism towards a possible investor cannot always be put down to an ‘enthusiastic belief in their business’. Sometimes prognoses are deliberately presented in an excessively rosy light. Peter Maenhout, the Head Connected Consumer at our Chair Partner Gimv, the regional investment company in Flanders, explains: ‘Just give us the “raw data” of an entrepreneur who knows his market.’

According to Professor Collewaert: ‘A manager in search of an investor is expected to make a prognosis for his business’ growth potential. The exchange of information between managers and investors turns out to be inaccurate in many cases: the prognoses are invariably extremely optimistic.’ 

Divide by ten

This over-optimism clearly has an effect on a potential investor’s attitude. Professor Collewaert continues: ‘The investor will automatically factor in the necessary reserves for these prognoses. Or, as the American venture capitalist Guy Kawasaki puts it: “If I obtain a prognosis like that, I divide it by ten.” That is a cliché, of course, but it does say something about the tension between entrepreneurs and investors.’

‘The tension is definitely there,’ Peter Maenhout confirms. ‘Kawasaki is a venture capitalist who mainly invests in young tech companies, of course. Companies that operate in a market that still has to be created, where there is a lot of uncertainty and business plans can be taken in many directions. In that light, “dividing by ten” is probably realistic. But that figure is exaggerated if we are talking about an entrepreneur who operates in a mature market or if we are looking at the buy-out segment.’

Naïve or manipulative?

Professor Collewaert is also conducting research into the underlying motives for this over-optimism. ‘We can distinguish two profiles: on the one hand, there is the entrepreneur as a naïve optimist. These are often people who have founded the business by themselves, are younger and have a closer connection to their business (e.g. through shares). In their negotiations with investors, the common goal will take precedence.
On the other hand, there is the entrepreneur as an opportunist. These people have not set up the company by themselves; they are older and see the investor merely as a money machine that they can take advantage of. This opportunistic attitude is often indicated by the “horizon problem”: people with a shorter career in mind are less concerned with the consequences for their reputation.’

Veroniek Collewaert, Professor of Entrepreneurship, Vlerick: ‘The “horizon problem” is sometimes an issue with older entrepreneurs.’

Gigantic spreadsheets

Does Gimv also see these two profiles in practice? Peter Maenhout confirms that it does. ‘That opportunistic attitude certainly exists. And it is often coupled with gigantic spreadsheets that show exaggerated results. The most sophisticated business plans are not always the most honest,’ he adds with a wink, ‘but it is our task to see through them. Just give us the raw data of an entrepreneur who knows his market. Someone like that is the perfect sparring partner, enabling us to draw up a realistic growth process together, even if that requires more capital than initially anticipated - capital is not something we are short of. Are there other ways of approaching the market (such as an omnichannel rather than an ordinary shop)? Can we move upstream or downstream in the production chain? That is Gimv’s raison d’être: putting those disruptive ideas out there and adjusting ambitions upwards where it is opportune to do so.’

Peter Maenhout, Head Connected Consumer, Gimv: ‘The most sophisticated business plans are not always the most honest.’


In 2015, 1300 entrepreneurs applied to Gimv for investment capital. Twelve of them got the go-ahead, corresponding to a total investment of 130 million euros.

Also read ‘Family companies more open to private equity’.

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