Putting on a Happy Face Can Backfire in Surprising Ways

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During a fundraising pitch, new research suggests that potential investors are more likely to be won over by entrepreneurs who make a variety of genuine facial expressions that change in tandem with a personal storytelling narrative.

Understandably, investors were turned off when entrepreneurs smiled too much or plastered on a phony ear-to-ear grin during a funding pitch. This peer-reviewed study (Warnick et al., 2021) by researchers at Washington State University appears in the Journal of Business Venturing's July issue.

This WSU research suggests that entrepreneurs are less likely to win over potential investors if they put on a happy face and only express positive emotions during a fundraising pitch. On the flip side, if an entrepreneur displays a mix of facial expressions that convey some happiness, a little bit of fear, and even small doses of anger—fundraising success is more likely to follow.

Smiling Too Much Can Make Entrepreneurs Seem Insincere or Overly Optimistic

By using facial expression software that was able to analyze the influence of entrepreneurs' different facial expressions on their fundraising success or failure, Warnick et al. ascertained that "the frequency of entrepreneurs' facial expression of happiness, anger, and fear has an inverted U-shaped relationship with funding."

"Our findings show that there's a role for different emotions in [funding] pitches," first author Ben Warnick, assistant professor in WSU's Carson College of Business, said in an April 29 news release. "For example, an angry facial expression can convey how much you care about something, instead of just smiling, which on the extreme end can come off as insincere or [overly] optimistic. It's good to balance that out. There are different reasons for using different expressions."

The latest findings from Warnick et al. dovetail with a University of Arizona study (Gabriel et al., 2019), which examined emotion regulation during co-worker exchanges. Allison Gabriel and colleagues found that so-called "surface actors," who were prone to fake positive emotions in an attempt to make a good impression among co-workers, were less likely to advance their careers than "deep actors," who displayed authentic feelings in the workplace. (See, "Faking Your Emotions at Work Could Take a Heavy Toll.")

Mixing Up Facial Expressions Puts Fundraisers in a "Goldilocks Zone"

During their qualitative analysis, Warnick et al. (2021) found that the most successful entrepreneurs tended to use a variety of different facial expressions to convey various emotions throughout a fundraising pitch.

For example, an entrepreneur might display happiness and positive emotions at the start of a funding pitch. But, later on, when discussing obstacles or challenges, making facial expressions that conveyed fear or anger seemed to strike an emotional chord with potential investors that made them more likely to fork over some cash.

Overall, the WSU researchers found that "people who expressed very little emotion on their faces did not do well in garnering funds, even if the words they were saying were compelling." Entrepreneurs who seemed emotionally static or relied too heavily on a single facial expression also fell short. Additionally, the researchers identified a negative relationship between facial expressions that convey sadness and successful fundraising.

The sweet spot for entrepreneurs trying to raise seed money from investors seems to be making a wide variety of facial expressions that convey a broad spectrum of emotions. As the researchers sum up, "the frequency of change in entrepreneurs' facial expressions promotes funding."

"There's a Goldilocks point where you can have too little or too much," Warnick concluded. "Expressing happiness, anger, and fear all promote funding up to a point. But if you express any one of these emotions too frequently, you're hurting your funding prospects."