The Critical Founder Startup Skill: Storytelling

by Joseph Bien-Kahn in
man wearing headphone using laptop while sitting beside table inside cafe

No role at a company is as sprawling as that of the founder: you are the fundraiser/boss/COO/recruiter/etc. But while some are more technically minded and others more managerially gifted, every successful founder must be an expert at one critical skill: storytelling. 

Why is startup storytelling critical?

When you start your business, all you have is a story. Here’s your story: 

  1. Why did you want to start X?
  2. Why did you leave your last job to build this? 
  3. Why does this new startup need to exist in the world?
  4. Why will customers buy or use your product?

You will tell a version of that story to every single person that is important to your business: your co-founder, your employees, your customers and your investors. You’ll even tell this story to your family. They might think you’re crazy but at least, if you have a compelling story, they can understand why you took the risk to start your business. 

Finally, once your founding story helps you create a viable business, it will become part of your vision and mission. 

Put another way: if you fail to create a compelling story, you will fail. There is nothing more important than your startup story. 

Building a story

A great story is one of those things that’s hard to explain but you know it when you hear it. Breaking the essential pieces of a story down to its bones, a founder can start to understand how to weave a great yarn. Almost no one has mastered the art of universally affecting storytelling better than the animation studio Pixar. And in 2013, Pixar Story Artist Emma Coats shared 22 rules for storytelling that she’d learned at the company. Each rule is helpful, but none has become as widely taught as Rule #4 (also known as “The Story Spine”): 

Once upon a time, there was ___. Every day, ___. One day ___. Because of that, ___. Because of that, ___. Until finally ___.

When organizing your thoughts as a founder, never forget the Story Spine Framing. Your Once Upon a Time should outline the status quo into which your company entered. Your Every Day should highlight the big problem. One Day is the moment of your epiphany/big idea. Then, the rest of your story should take your audience on a journey toward the Finally

How did Elon Musk do this with Tesla? 

elon musk

Source

No current CEO has the storytelling chops of Elon Musk. As far back as 2006, Musk shared his cheekily named “The Secret Tesla Motors Master Plan (just between you and me)” publicly on his blog — it was a roadmap that his business followed to a T, but it also was a way for customers to understand the bigger mission.

Musk’s first step was to create a low-volume, expensive car which would fund the development of the medium-volume Tesla. That first car, the Roadster, completely redefined what electric cars could be when it launched in 2008. It was fast enough and exclusive enough to be worth the price for many, and Musk’s master storytelling made it almost noble to buy one. This wasn’t a midlife crisis sportscar; Roadster drivers were funding the future and saving us all from global warming.

He successfully used the popularity of the Roadster to launch the Model S, and then used that popularity to launch the Model X and the Model 3. In a decade, Musk laid the framework for a story, allowed the readers to see how it would go, told them they’d be heroes on his journey alongside him and the team of engineers, and then made the story a reality. When he released the Model 3, instead of writing “The End”, he released “Master Plan Part Deux” — solar roofs, electric vehicles in every automobile space, improved self-driving, and cars that can earn autonomously. Musk’s 48.4M Twitter followers are following this second story with baited breath.

The Story Spine Framing is a simple guidepost for a storyteller. It will guarantee that your story has the three things every story needs: A Beginning, A Middle and An End. It sounds reductive to say, but think back on the worst pitches you’ve heard — they never follow a three-act structure and they often leave the audience grasping for the Why of it all. 

A great story never leaves an audience bored and never has them asking, “What’s the point?” Whether you’re speaking to your team, a room of investors, or your customers, make sure you are concise, and never forget to highlight both the problem and the solution. 

Coats’ Rule #22 is less shared than Rule #4 but it’s the most important of all for a founder to learn: “What’s the essence of your story? Most economical telling of it? If you know that, you can build out from there.”

What is the Essence of Your Story?

One key to a great story are stakes. What are the stakes at the heart of your story? Why — of all the things you could do — did you decide to set out on the arduous path of starting a company? And what did you risk in taking that leap?

When crafting the story of your startup, always begin at the problem. As Heidi Zaks of ThirdLove told us, she had 12 bras in her dresser and none of them fit. Ryan Cohen of Chewy wanted the convenience and personal touch of the neighborhood pet store without having to leave his couch. Great founders see a specific problem that many people share; that’s where your story begins.

From there, identify and commit to your startup’s core mission and vision. This will be the moral of your startup’s story — the big takeaway, the essence. Are you “changing the way people feel about banking”? Are you “accelerat[ing] the world’s transition to sustainable energy”? Are you committed to being “the most trusted and convenient online destination for pet parents (and partners), everywhere”? Your story should leave the listener convinced that the problem is pressing, the mission is worthwhile, and you’re the one to solve it.  

Who Is Your Audience?

black chair lot

Once you’ve explained the pain point and identified the moral, you must focus on how to present the journey. Less skilled storytellers will get lost in the weeds here (unless you’re talking to a roomful of engineers, no need to include the anecdote about switching programming languages), but you should be concise and make sure to tailor the middle of your story to your audience. 

Investors

In a 2014 lecture to the Stanford Graduate Business School, Marc Andreessen explained what he and his partners looked for in a company and in a founder. It’s an oversimplification but a helpful focusing tool for your story to investors:

In a Startup: Huge market, Differentiating technology, and Incredible people

In a Founder: Courage (determined to succeed and undeterred by missteps and adversity) and Genius (imaginative ideas and a novel way of thinking)

Thus, if you’re speaking to an investor, the journey section should emphasize the hustle, the moat, and the way your team thinks differently — what let you see the problem others had missed? What were the challenges that you overcame to build a problem-solving startup? Why were you and your team uniquely qualified to do the job? With an investor audience, Pixar’s 14th Rule is an important one to remember: “Why must you tell THIS story? What’s the belief burning within you that your story feeds off of? That’s the heart of it.” 

At the early stage (pre-seed, seed, and even Series A), VCs are investing in the founder as much as the company — you and your team are the protagonists of your startup story and every investor wants to know why you, specifically, are the team to take this idea to market. The world is filled with brilliant, hard-working individuals but only a select few of those individuals can articulate why they are the ones an investor should fund. 

Your Team or A Reporter

If you’re speaking to your team or to a reporter, the emphasis of the story’s Middle should be different. Remember: what’s most interesting to you is not what’s important; you want to capture the attention of your audience. 

With your team or a reporter, the tricky balance is to communicate two things simultaneously: the hurdles you overcame and the mistakes you made. No one wants to write about or to follow a braggart — don’t lionize yourself in your story; demonstrate vulnerability and mistakes overcome. Pixar’s 6th Rule is a valuable guide here: “What is your character good at, comfortable with? Throw the polar opposite at them. Challenge them. How do they deal?” 

Every startup faces existential moments — the ones that make it are the ones that overcome the challenges. For a reporter, walls scaled and dragons slain provide narrative structure but that doesn’t mean you have to shine your knight’s armor in the process. For your team, mistakes made and overcome demonstrate that failure can be the grandfather of success.

During her last interview, founder of the Body Shop Anita Roddick explained how she used stories to inspire her employees: “One of the most intriguing things in management and in business is the role of storytelling – people need the anecdotes to do the work they do.” A story of a team member’s great win, or a challenge overcome, or even a founder’s costly mistake can reinforce the mission and give your team a window into what’s most important to you: the leader. 

The stories you tell to your team and to the press are the ones that show future employees and customers what you and your company value most. The last thing you want is to communicate that the essence of your startup is the founder’s ego or personal glory.

Finally, at a startup, times do get tough. It’s in those tough times that the founders who tell the best stories are able to rally their team. They take something that would destroy a startup into a story about a bright future, if only we can work hard through this current challenge. Elon Musk famously did this when he was pushing to get the Tesla 3 out the door….

Customers

The last audience we’ll cover may be the most important: the customer. Authenticity is essential for any storytelling, but doubly so when talking to your customer base. These days, consumers’ BS meters have been turned up to 11, so make sure you’re being open and honest when explaining what your company is about and even why you founded it. 

It’s tempting to create a foundational legend of your startup, but this is where truth and transparency are paramount. “Transparency is a key way of creating trust because it helps eliminate any suspicions or anxieties your customers might have about the value of what you’re offering,” Michael Weinhouse, the Founder and Co-CEO of Logical Position, wrote on Forbes. “By laying out the truth about your products and services, including their limitations, you’ll prove that you aren’t trying to hide any flaws or defects.”

Remember that the goal of the story is different for customers than for your team or investors. For the other audiences, you’re demonstrating why you, as the CEO and founder, are the person they should trust to run the business. For customers, the goal is to show that you’re the company they should trust to buy the product. Think about it: you’re a startup. You’re early. Your product barely works or is held together by duct tape. Why should any customer ever trust you with anything? Have you heard the old statement, “No one was ever fired for purchasing IBM.” A more modern version might be, “No one was fired for choosing AWS.” Either way, the point is that a story is what convinces your customer that they should take the risk on your product. 

An investor might want to hear about 80-hour weeks obsessing over the MVP. An employee might want to hear about an engineering mishap that took you offline right before an important VC pitch. But a customer wants to know that your company is trustworthy, and has expertise, a moral compass, and an ability to deliver the best for the most affordable price. All of your messaging should focus on delivering that story — everything from website copy to UX design to your packaging is part of that storytelling. 

So, if you’re always telling a story to your customers, it’s essential to identify your story’s essence right away. What matters to your startup? What sets you apart? Why are you the kind of company they’d want to buy a product from? 

“Come up with your ending before you figure out your middle. Seriously,” Coats writes as her Seventh Rule of Pixar Storytelling. “Endings are hard, get yours working up front.”

To get from Once Upon A Time to Finally is an essential skillset for a founder. Like any skill, it takes practice. But none of the work is wasted. It reminds you of what sent you on this journey and where you’re headed. 

Eventually, you’ll have told your story hundreds of times — to investors, employees, colleagues, and customers. If it’s well-crafted and well-told, it can be a tool to raise money, recruit talent, and attract customers. It can also be the thing that keeps your startup’s mission forever front of mind. 

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