This blog post will give insights on how we can make use of storytelling for startups fundraising. It is also sometimes called as brand storytelling.
The art of narrating a story (either a fiction or a real life experience) is called as Storytelling. Storytelling is a great way to capture people’s attention towards you. Because people love hearing stories. You might not remember any technical jargon that you have learned yesterday or the previous week, but you would remember a lot of stories that you had heard in your childhood days. Don’t you? Stories remain in human being’s mind for a prolonged period of time. That is the power of a story.
Stories engage us through emotions and help connect us to others. Through stories, we share passion, sadness, hardships, and joys. In other words, through stories, we can explain, captivate, disturb and inspire. We share meaning and purpose through stories. Stories are the roots of many decisions that you take on a daily basis(with or without your knowledge). Stories allow us to understand ourselves better and to find our commonality with others.
Our entire human race is wired through stories. When someone narrates a story, you automagically visualize that in your mind as though it is happening right in front of you. This is because, when human being imagines an experience, in the brain, those imaginations are processed in the form of real experiences. Stories create emotions and behavioral responses.
By engaging our imagination, we become participants in the narrative. While a story is being narrated, we will be able to increase our ability to understand and share the feelings of another.
Storytelling For Startups Fundraising
Investors are human beings and even they are driven by emotions. Your success in landing a seven-figure investment depends on how nicely you can narrate a heart touching and emotional story. Excellent storytelling combined with extraordinary elevator pitch and crisp pitch deck is the success mantra of several successful entrepreneurs. Many successful entrepreneurs have been very successful in using storytelling technique to attract investors for their startups.
According to Evan Baehr (Co-founder of Able) & Evan Loomis (Founder of TreeHouse), there are 4 key elements in storytelling for startups fundraising. They are:
- The Origin Story
- The Customer Story
- The Industry Story
- The Venture Growth Story
These key elements forms the basis of storytelling for startups while pitching to your investors. Let us understand each one with an example.
The Origin Story
Narrate an emotional and heart touching story on what incident made you start this venture of yours. For example, Phanindra Sama, Co-founder of redBus.in got his venture funded by narrating an emotional story of how he could not book tickets to travel to his native during a Diwali vacation due to non-availability of bus tickets. This had led him to start redBus.in.
- The Actual Story:
In the year 2005, Phanindra Sama wanted to celebrate Diwali his hometown, Hyderabad. Since he was unaware of his schedule until the end, taking a bus was his only option. As it was a Diwali season in India, all buses were running filled.
He ran around the traffic jammed Bangalore city hunting for a ticket, but they were all sold out before he reached the travel agents. That’s exactly what happened that day. While going through all these problems, he also realized some key issues with the then-existing model followed by travel agents:
- Travel agents did not have enough information regarding all the possible bus operators within the city. This led to a gap wherein customers had to make decisions based on limited information available to them.
- Most of the agents were unable to sell canceled and return bus tickets due to lack of a proper system and process.
That’s when he and his friends got of an idea of starting redbus.in . Redbus.in is a platform where all information related to the bus bookings were made available to the customers for easy access at their comfort through the internet and help them make better decisions. The internet was the best medium to deliver all this information and make possible e-commerce to purchase return bus tickets.
The Customer Story:
Narrate a story that depicts the problem faced by the customer and let your investors know how your startup, product/service can help solve that problem.
- The Actual Story:
Ashish, the founder of BookMyShow.com found a particular problem faced by customers. The problem was in the entertainment space. Customers had to visit the cinema houses hours before to secure a ticket to watch their favorite movie. Long queues for blockbusters added to the problem. Especially on the weekends, there were stories of customers who after waiting for a long time did not manage to secure a seat for their favorite star’s movie.
These problems led to the startup “BookMyShow.com” – a platform where you can book tickets for your favorite shows online through desktop or mobile even before days and weeks of the actual show date.
The Industry Story:
Narrate a story that depicts how industries are changing due to technological advancements and let your investors know how your startup, product/service can take advantages of the newer customer needs through technology upgradation.
- The Actual Story:
After working for Wipro for almost a decade, in April 1998, Subroto Bagchi (Co-Founder of MindTree Ltd.) moved to Lucent Technologies. Lucent wanted to set up their Bell Labs Development Center at Bangalore. Subroto Bagchi recalls during his interview with, how he had the opportunity to work on a strategic study of the future of the Indian software industry while at Lucent Technologies.
Subroto Bagchi was clearly able to envision the future of businesses. He could visualize that, 21st century belongs to the those who can emerge as a leader in the services industry especially in the information technology sector. Given that, he felt there would be an insatiable demand for software services all over the world and those who can give early emphasis on it can reap the benefit of creating post-millennial software solutions company.
This led to the founding of one of the celebrated software companies of India – Mindtree Ltd.
[Note: The “Making of the Mindtree” is told in the first person by Subroto Bagchi. In condensed form, it was published by BusinessWorld, filmed by InfiniTV, and aired on CNBC, IT Hour]
The Venture Growth Story:
This story is needed when you are looking for additional rounds of funding for your startup.
Narrate your story on how your venture has grown from the day it was founded till date and what key milestones were achieved within the set timeframe. Also, emphasize on the constructive usage of the funds that were received so far which gives confidence to your future investors to invest in your business.
Keep in mind the following while pitching your investors through storytelling for startups fundraising:
The Origin Story is about Founder(s) Inspiration
The Customer Story is about Customer(s) Problems
The Industry Story is about New Industry Trends
The Venture Story is about Your Startup Growth
Hope you learned a lot and enjoyed reading this blog post on “ How To Use Storytelling For Startups Fundraising”. Feel free to comment your opinions below.
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