Stories engage our lives. We attend movies and plays, we read novels, we watch TV, and we tell each other about our lives. With businesses, the story is the same. Articulating your brand story is one of the most powerful ways to breathe life into a business. It's a way to prove the value of your business. It's a way to communicate facts about your business in a way that is so engaging listeners feel they have a stake in your success. When you’re looking for financing, engaging your audience through storytelling can improve your ability to make a deal that works for all parties involved, creating the potential for long-term partnerships.
Your story is your point of differentiation
In a recent article by Meghan Daniels of Axial entitled “How Buyers Evaluate Risk: Due Diligence 101,” she speaks to the specific process of due diligence, or uncovering and evaluating risk, noting the dozens of considerations, tangible and intangible, which should be taken into account when evaluating whether a transaction is a good fit. This process not only looks to confirm the accuracy of the information a company has provided, but also to unearth any potential risks not detailed, whether intentionally or unintentionally.
This article provides a valuable list of specific areas covered in the due diligence process, and a laundry list of documentation often required. This information is extremely relevant as it is important to get your house in order before you look for funding. The more complete your information, the faster the transaction. The more transparent you are with your information, the less likely the deal will stall. The more thorough you are, the more the lender can craft the financing deal that best fits your need.
But—all the numbers, statistics, charts, and diagrams in the world can’t tell your businesses entire story. There are many aspects of a business that simply don’t show up on a balance sheet. Stories are what create differentiators to make your business memorable, compelling, and worth investing in. Especially when your lender is on the edge of a decision that could make the difference for your company’s growth.
Bringing back stories to the forefront
When people think of your business, what story comes to mind? There are stories behind the reason your business exists, why you've developed specific products and services, and why you seek to grow. Your story and being able to articulate it matters when looking for financing.
“A good story makes you feel something and is universal. They want to grasp your values and your commitment to excellence; be inspired and intrigued. Storytelling is the most powerful way to convey these ideas,” stated Mark Truby, Vice President of Communications, Ford Motor Company.
One of the most classic examples of a brand story is Nike. Nike has leveraged storytelling for decades. It’s been twenty years since Nike launched the 'Just Do It' slogan with a commercial all about Michael Jordan’s career, with no mention of the brand until the closing seconds. This was one of the first times a company showed that what would really make a lasting impression and help to build the brand, was an authentic story. Nike is now the world’s most valuable apparel brand, with a brand value of over $30 billion. Richard Haigh, Managing Director of Brand Finance, commented: “Nike’s bold marketing makes it stand out in a busy marketplace of sportswear apparel brands. In a time when customers look for experiences and emotional connection, Nike’s offering comes with unambiguous messages and values that people can rally behind.”
Storytelling enhances a company’s financial value
There’s more proof that a smart storytelling strategy can raise perceived value. About 10 years ago, the Significant Objects literary and anthropological experiment “demonstrated that the effect of narrative on any given object’s subjective value could be measured objectively.” The hypothesis was that “stories are a driver of emotional value and can transform insignificant objects into significant ones.” In this experiment, the researchers listed insignificant objects on eBay along with heartfelt and well-written stories about the item. The items, which were originally purchased at a garage sale for no more than $1.50 each, resold for nearly $8,000.
The most successful companies in the world have stories strongly linked to both a sense of purpose and meaning. Think Apple, Ben & Jerry’s, Google, Tesla, Disney. Storytelling and brand value are tightly linked because there is no better way to connect and engage. The ability to tell a good story is essential and can make or break a company’s ability to showcase its value and obtain financing. A business may truly have a better product or service, but in the end, decision-making is much more emotional than it is logical.
This is the first of a two-part series. Stay tuned next week for part two.