I would not have even bothered to write about this -- it's so obvious it sounds patronizing -- had I not met with a startup company the other day (not a YC company) who actually did this. Sometimes even the obvious needs to be stated, so here's a bit of free advice for startup companies. (Actually, this is good advice for any company, but startups in particular.)
Never turn down a sales lead.
When someone offers to put you in touch with a potential customer, always accept, and do it graciously. You don't have to actually follow up on the lead (although you'd be foolish not to -- even if you're absolutely sure that the lead is worthless you never know when you're going to be pleasantly surprised). But under no circumstances should you tell the person offering you the lead that you have no intention of following up even if it's true. Most of the time honesty is the best policy, but not in this case. You are much better off saying, "Thanks for the lead, I'll follow up on it ASAP" and then not doing it than you are explaining all the reasons why you think the lead is useless. In the former case you can always plead schedule overloading or amnesia or something like that (assuming you are ever in a position where you have to explain why you didn't follow up, which is extremely unlikely). But if you start trying to explain why you think the lead is useless there are only two possibilities: either you're wrong, in which you will sound like an idiot, or you are right, in which case you will make the person who offered you the lead feel like an idiot. Either way it's not going to help.
So rehearse this line and add it to your repertoire of little white lies: thanks for the lead. I really appreciate it. I'll follow up on it as soon as I can.
UPDATE: There is one exception to this rule, and that is if the lead is one you have already followed up on, in which you can (and should) say, "We already tried them and it didn't work out because of X and Y and Z."
lying is never right either.
How about "Thanks for the lead, I will file it away and refer to it when we need it"
one little lie after another and soon you have no integrity.
We must always say thank you to the person who gave us the lead.But if we know that it is useless,I think the best thing to do is to be honest,explain to them why we did not take time to follow up the lead.
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