One would hope that investors, on dealing with unsophisticated entrepreneurs, would tell them "Hey, it seems like you don't know the ropes of this yet, let me e

One would hope that investors, on dealing with unsophisticated entrepreneurs, would tell them "Hey, it seems like you don't know the ropes of this yet, let me explain it to you" but the overwhelming number of anecdotes where I hear that have that sentence followed by advice so bad it shocks the conscience. Most people know that when they deal with savvier and more experienced people in the upper class, they're at serious risk (okay, high probability) of getting an unfair deal, but their model of "unfair" is 60/40 or 70/30, which most people can accept in the course of getting their vision off the ground. See also: http://en.wikipedia.org/wiki/Ultimatum_game http://en.wikipedia.org/wiki/Ultimatum_game In practice, it's often more like 95/5 or even 99/1. The people who know the game and have the power take almost all of it, and leave just enough to keep people motivated to produce.