Lying about your progress and metrics is extremely rampant in the startup world of SV... but IMO SV's biggest lie is that you need to be in SV and you need SV money to build a successful company. This flat out isn't true, especially if you're building a web service where your customers can be anywhere in the world and services / platforms that allow you to scale up incrementally exist. Most of what goes into building a startup is time-consuming trial-and-error grunt-work (e.g. reading documentation, editing boiler-plate code, answering emails / phone) that can be done much more cheaply and less stressful-ly from your mom's basement than hemorrhaging $10k to $100k / month in a downtown SF office while the scaffold of a 4 month deadline looms ominously before you. (There's a case to be made for the value of mentorship, but that value is always multiplicative and never additive - as in, if you don't have a business, your value of 0 is still 0 after multiplying it by the value of your mentor. So for mentors, the later the better.)

SV's second biggest lie is that you need the so-called "hockey-stick" growth curve to be competitive in order to be successful. This lie is clever because you're so caught on hockey-stick that you forget to question the premise of competitive. In the beginning of founding your startup, knowing about your competition might help you build your own product, but worrying about your competition is worthless because the world is more than big enough for the both of you (especially considering you don't exist yet). And if you don't have overhead (i.e. you didn't take SV money and hire a ton of SV's cleverest and most paid engineers), the world will always be biggest enough for you to survive.

SV's third biggest lie is coffee can replace sleep. That's not true, and one of your organs (usually your liver, but I've heard stories of kidneys, lymph nodes, beards, and even ovaries) will let you know after a bit.