Featuring our very own Paul Smith
A well-honed founding story can help you connect with investors, employees, and consumers — and, with any luck, keep them listening.
Sara Blakely had her product–an undergarment that smoothed the contours of a woman’s body, making clothes more flattering and comfortable. But she had yet to make her first sale. She managed to land a meeting with a buyer at a Neiman Marcus store in Dallas. Clad in a pair of formfitting white pants, Blakely invited the buyer to join her in the ladies’ room, where she proceeded to demonstrate the difference in the way the pants looked–with her undergarments, which she had dubbed Spanx, and without. Three weeks later, Spanx was on the shelves. She pulled the same stunt with buyers for Bloomingdale’s, Saks, and Bergdorf Goodman. “I wore those white pants for three years to sell Spanx,” Blakely says.
The tale of the white pants has become a key component of the Spanx story, and Blakely
still loves to tell it. And why not? It continues to embody the powerful, $250 million brand she went on to create. “Women have been neglected as customers,” she says. “We have been told that beauty is pain. I call that BS–Before Spanx.”
“In a world where people have a lot of choices, the story may be the deciding factor.” – Nick Morgan
Before it has investors, customers, profits, press coverage, or even a perfected product, every startup has at least one valuable asset: its story. So you might want to ask yourself: Who are you? Where did you come from? Why are you doing this?
Even if you’re answering these questions only for yourself, your co-founders, or the guy sitting next to you on the plane (hey, he asked), your company’s origin story has more power than you might imagine. And that’s true whether it begins in a garage (à la Hewlett-Packard, Apple, and Google), a dorm room (Dell), the streets of a far-off country (Toms Shoes), or the offices of a former employer (most everyone else).
“I’m hard-pressed to think of a company that doesn’t have an interesting foundational story,” says Paul Smith, an executive coach, former director of market research at Procter & Gamble, and author of Lead With a Story. “But I suspect there are many that haven’t crafted and told theirs. And they’re important. People want to be part of something bigger than themselves. A nameless, faceless corporation with no real purpose, no story, is not an inspiring place to be.”
The creation myth is not an asset just for startups. As those businesses grow into established firms and individual founders figure less prominently, the origin story can serve as both a road map and moral compass. Keeping that story alive, keeping it true, and keeping it relevant–these are the challenges more mature businesses must contend with.
“In a world where people have a lot of choices, the story may be the deciding factor,” says Nick Morgan, a communications consultant and author of How to Tell Great Business Stories.
This is especially true of investors. “We are trying to understand the source of the founders’ passion,” says David Cohen, co-founder of Techstars, a startup accelerator with programs in seven cities worldwide that has provided the launching pad for more than 250 companies. “Why do you care so much? It might be a personal connection to the problem or just a strong vision of a different or better world. If it’s ‘for the money’ or ‘because it’s a big business,’ that’s poor motivation. It won’t sustain most people through the difficulties of starting and scaling a company.”
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Indeed, many VCs think of themselves as investors in stories, and storytellers, every bit as much as investors in companies. “How well does the founder’s life explain what they’re doing at their company?” asks Scott Weiss, a general partner at Silicon Valley venture firm Andreessen Horowitz.
Weiss likes to talk about his first meeting with Ben Kaufman, founder and CEO of Quirky, which manufactures and markets products invented by “regular” people. “I can remember it almost word for word,” he says, “this quintessential story of a kid trying to get his first product [iPod accessories] to market with his first company. It was called Mophie, named after his dogs, Molly and Sophie. The process of getting them made in China, the shipping problems–it was so hard to do. He figured, There’s got to be a better way. That was how Quirky was born.
“When you heard Ben talk about his struggle and insight, you were convinced that he’d walk through walls to follow his vision,” Weiss says.
“One day I cut the feet out of a pair of pantyhose. That was my ‘aha’ moment.” -Sara Blakely
Of course, it’s highly unusual for entrepreneurs to approach investors with their story perfected. In many cases, in fact, a company’s narrative may emerge only in retrospect. That’s why Steve Jurvetson–the visionary VC behind companies such as Hotmail, Tesla Motors, Synthetic Genomics, and SpaceX–always brings a camera to early meetings with founders. “I say, ‘You’re going to want these when you’re in the Fortune 500,’ ” Jurvetson says. “We help founders sculpt stories by remembering anecdotes, with a sense for what the outside world might think of as interesting angles.”
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As you sculpt your own story, make sure your tales don’t grow too tall in the process. Back in the 1990s, many people were tickled to learn that eBay was born out of founder Pierre Omidyar’s desire to help his more easily trade the Pez candy dispensers she liked to collect. Unfortunately, the tale was pure fabrication dreamed up by an inventive PR manager to generate media interest after Omidyar’s earlier, truthful explanation about wanting to create a “perfect market” failed to get traction.
Omidyar was lucky. When the truth came out, years later, eBay was a well-established business and didn’t suffer any consequences. But in our increasingly transparent world, even “harmless” lies risk being found out–and punished–faster. And the Web, as we well know, can be merciless.
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The eBay publicist’s instinct to find a personal angle was understandable. Lindsey Scott, vice president of LaunchSquad, a public relations firm in New York City, has worked with companies whose founding stories play well to a popular audience. Consider Diapers.com: “The founders would take U-Hauls and buy up all the stock at Costco, then ship out of their garage, because the diaper companies wouldn’t sell to them directly,” Scott says. “As new dads, they saw the need to get something quickly, overnight. It was also kind of unexpected that it was men founding the company. They were very relatable, and the story brought the brand to life for a lot of people.”
What if your business is more complicated than shipping diapers? In those cases, Scott focuses on the problem the company solves rather than the person who created the solution. But whatever your pitch, the challenge is to find a way to connect with people on a personal level. “The key is to be genuine,” Scott says. “If you’re not the guy in the garage, don’t try to fake it.”
Meanwhile, it’s important to remember your audience. You don’t necessarily want to tell the same story to everyone. Media people, for example, generally look for stories about people. But a potential corporate partner, for example, might be turned off if it sounds as if any one person is too important. “You want to convince them of the institutional strength of the company,” says Jurvetson. “That could be a very different pitch, emphasizing an unusual skill set in the company or a unique technology.”
One arena where storytelling matters more than anything is crowdfunding, in which the roles of consumer and investor are merged. On a crowdfunding site, your story has to do a lot of work–and quickly. “There are two elements to a successful Kickstarter campaign: the product and the story,” says Slava Menn, co-founder of Fortified Bike Alliance, a manufacturer of heavy-duty, theft-resistant bicycle lights that successfully crowdfunded its way into existence. “For it to be something that people walk away from and remember, it needs to be personal and have emotion built into it.”
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Menn admits it was a tough case to make: There is nothing particularly emotional about bike lights. “It’s one of the more boring products on a bike,” Menn says. He and his team struggled to come up with their company’s story. And then inspiration hit: “Our friend had his bike light stolen; then he got hit by a car coming home,” Menn says. “It was emotional and true and so simple that a person could retell it the same way after hearing it once.”
And it worked. Fortified’s first product presold $84,000 on Kickstarter and is carried in 160 bike shops worldwide. Its second line presold more than twice that and is currently being manufactured.
Founding stories can matter as much inside a company as outside. “They create and maintain a common culture and heritage, a sense of purpose and past,” says Smith, the executive coach. “Retelling the story to each generation is important to maintain that.” It’s not enough to have the founding story on the company website (although that’s a good idea). You need to tell it again and again.
Weiss, of Andreessen Horowitz, advises startups in his firm’s portfolio to stage quarterly new-employee orientation sessions, at which the founder stands up and talks about how the company was founded and details the company’s values. “Everyone, including the guard at the door, needs to know the story and purpose of the company,” Weiss says. “Every employee is an ambassador.”
Even when a business outlives its founder, his or her story should remain woven into the company’s culture. At the Milwaukee-based insurance giant Northwestern Mutual Life Insurance, for instance, employees still learn about a train accident that occurred near Johnson Creek, Wisconsin, in 1859, shortly after the company was founded. Fourteen people were killed, including two Northwestern Mutual policyholders, whose claims totaled $3,500. The young company had only $2,000 on hand, but its leaders took out loans to pay the claims in full immediately. “For employees,” says Smith, “the story lets them know how to make decisions. And when talking with a potential policyholder, it becomes a really great sales tool.”
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The celebrated entrepreneur Jerry Greenfield, who is no longer involved in running his namesake ice cream company, says the founding story is something that necessarily evolves over time. “A big part of the story of Ben & Jerry’s is not just that it started in a gas station from humble beginnings, but that it made a conscious decision to be a different kind of company that tries to integrate social and environmental concerns in the day-to-day business,” Greenfield says. “The story about the founders, Ben and Jerry, makes it human. But the key for the future of the company is a vision of what the organization stands for. The founders–charming as we were–we’ll be gone at some point.”
Inevitably, social media also play a big part in making yourself heard. Twitter and Facebook may be shrinking attention spans, but they also have an amazing capacity to amplify your voice. “It’s harder to tell a story in 140 characters on Twitter,” says Smith. “But if you can get someone interested, you can direct them to your website or post a 10- or 15-minute video on YouTube.” Those longer videos, Smith points out, have dramatically “expanded the duration of stories and opportunities to engage beyond traditional advertising.”
Entrepreneurs also need to be extrasensitive to the power of consumers to rewrite their stories, for better or worse. Consumers are watchdogs–so if your company touts itself as a social do-gooder, you had better make sure you are actually doing some good. “Transparency in business has been a real game changer,” says Fred Haberman, co-founder of Haberman, a Minneapolis marketing firm. “It’s great for people who want to do good in the world, but it also forces organizations to be very deliberate about how different aspects of their story are going to manifest themselves.” Adds Smith: “Brand equity is owned by consumers, not marketers.”
Be mindful if the details of your story start to slip as it makes its way across the Internet. But if consumers and media start telling a story that works even better than the one you came up with, Smith says, “you may not want to fight it. Spending inordinate amounts of effort to maintain the integrity of minute details of a story is often unwarranted. My acid test is, If someone there when the origin story happened heard you tell it now, would they be offended? If not, don’t change the story.”
And with that, it’s time to get started: What’s your story?