3 Take swift action to notify the venture capitalists of the truth of the situation - and start cleaning house to get rid of people who would knowingly lie to close a deal. As the new, heavily recruited CEO of a high-technology start-up backed by several of Silicon Valley's leading venture capitalists, Chuck Campbell is flying high-great job, good salary, stock options, and a chance to be in on the ground floor and build one of the truly great twenty-first century organisations. Just a few days into the job, Chuck participated in a presentation to a new group of potential investors for funding that could help the company expand marketing, improve its services and invest in growth. By the end of the meeting, the investors had verbally committed $16 million in funding.

But things turned sour pretty fast. As Chuck was leaving at about 9 p.m., the corporate controller, Betty Mars, who had just returned from an extended leave, cornered him. He was surprised to find her working so late, but before he could even open his mouth, Betty blurted out her problem: the numbers that Chuck had presented to the venture capitalists were flawed. "The assumptions behind the revenue growth plan are absolutely untenable', she said. 'Not a chance of ever happening.' Chuck was stunned. He told Betty to go home and that he'd stay and take a look at the figures.