Less and less is secret in the world we live in today. Certainly in the technology business it is hard to keep something under wraps for long. There is just too much liquidity of information flow that goes on.
But most companies still believe that their core assets, their business strategy, their technology architecture, their key people, their customer list, etc is valuable and should not be made public. And so it isn't.
But every once in a while, an opportunity comes along that requires that the company provide someone (an investor, a potential hire, a potential merger partner, a potential acquirer, etc) a look inside the company. The cliche I like to use to describe that process is opening the kimono.
I honestly don't know where I got this phrase and when I started using it, but I've used it for a long time now. Clearly there's a sexual/sexist origin to this phrase and one would think it originated in Japan.
The Microsoft Lexicon says the following about it:
Open The Kimono: A marvelous phrase of non-Microsoft origin, probably stemming from the rash of Japanese acquisitions of American enterprises in the ‘80s, that has been adopted into the Microspeak marketing lexicon. Basically a somewhat sexist synonym for "open the books," it means to reveal the inner workings of a project or company to a prospective new partner.
It's so funny to read that coming from one of the all-time most famous kimono openers.
I was in Chicago last week and stopped by to see our friends at Feedburner and happened to use this phrase in that meeting. Dick Costolo told me that I owed him $1 because that phrase had been so overused by a former colleague that payment of $1 was now required by anyone who uttered it.
I didn't pay him the $1 but we all agreed that it is a really good and descriptive cliche.
Entrepreneurs open the kimono when they talk to VCs and must be careful about that. VCs are, by nature, opportunistic investors who like the see the entire market when they invest. So they will want to meet with everyone working in a particular market space before they make an investment. We do that at Union Square Ventures to the degree that we can, and we make our approach very clear to everyone who walks in the door. We also have a reputation to protect so we are careful what we do with that information. We use it to inform our investment decisions, but we don't share it outside of our firm. It doesn't take too many situations of information leak to sully a firm's reputation.
There are times in business when you must open the kimono. But just be sure you know what you are getting into when you do that. There are companies out there, such as Microsoft and Google, who love to get you to open your kimono but also have reputations for one night stands.