Every Startup Has Three Stories, and You Need to Tell All of Them
Every startup — from inception all the way through to the last pre-IPO funding round — has three defining stories. It’s up to company leadership to sell these stories to customers, investors, the team and themselves.
The themes of the three startup stories are deceptively simple:
- What the company is.
- What the company will be.
- What the company should be.
The first story is what you do when you walk through the door every day. The second story is the overarching goal that everyone on the team is working toward. The third story is the dream — the billion-dollar moonshot.
But even when the stories themselves are well-constructed and understood, several problems can bubble up while you’re trying to simultaneously manage three unique identities.
- The team starts stepping on one story to get to another.
- The company gets focused on the wrong thing at the wrong time.
- The company winds up either sacrificing revenue for growth, or sacrificing growth for revenue.
In more than 20 years of working on and with startups, I see this happen all the time, whether the company is a freshly hatched pre-seed startup or a multi-million-dollar unicorn wanna-be. The stories get jumbled; the execution gets mangled; and the direction starts spiraling.
This is leadership’s fault. Leadership needs to learn how to tell all three stories at once.
The Goal: Balance the stories
The three startup stories are not unlike episodic writing, the kind of writing you might find in a well-defined TV series.
- Story A has an arc that begins and ends in each episode (with the occasional cliff-hanger).
- Story B has a longer arc that keeps you watching from episode to episode.
- Story C has an arc that covers the entire series from beginning to end.
Single episodes might not advance Story C at all. And a good Story C wraps up every plot point of Story B. At the end of the series, you’ll be able to piece Story C together, but that won’t be possible in real time.
Now, let’s bring these stories into startups and business. We’ll use Amazon as an example, because it’s universal and easy to understand.
- Story A: Circa 1994 — Selling books and CDs over the internet.
- Story B: Circa 2000 — Dominating this new thing called eCommerce.
- Story C: Circa 2005 — The hub for bringing products and services into our lives. Or, more succinctly, dominating commerce, without the “e.”
Understand that Bezos didn’t just wake up one morning in the late 1990s and think to himself, “You know, maybe we should be selling more than books.” Amazon also did not one day realize its growth wasn’t limited to just selling stuff over the Interwebs.
The plan was in place all along because the Amazon story was long-form.
The Method: Write the book
Your customers are going to experience the three stories as they play out episode by episode. But telling those stories — communicating those stories to the people executing on them—that requires a book with a clear beginning, a middle, and an end.
I’m not a writer by trade, but I have tackled short-form, episodic, and long-form writing, and I’ve found each to be an invaluable tool in building a company. Being able to write—and learning the mechanics of storytelling—have helped me communicate the direction of my companies in a way that balances today vs. tomorrow and revenue vs. growth.
I’ve learned that almost any writer can take the characters and scenarios of a story and write a passable episode, even a good or great episode. But it takes an entirely different skill to weave a bunch of great episodes into great seasons and into a series that is satisfying and successful.
That’s long form. That’s Amazon. That’s how company leaders need to communicate their three stories.
Plot out the ending and work backwards
This is not as easy as it sounds.
Getting a little general here, but there are two types of first-time failed entrepreneurs I run into. The first type has a billion dollar idea (Story C) but struggles for a few months or years without ever taking the right first step. The second type jumps right into a revenue-generating startup idea (Story A) but flames out after a few months or years because that thing they started doing winds up being all they end up doing.
If you’re going to write a cohesive book, you need to figure out the ending and work backwards. Let’s take a simple murder mystery as an example. You need a killer, a motive, and a discovery, but you don’t want to introduce the killer on the first page. Maybe you just drop a clue here or there.
Thus, you need to map out all the plot points running backwards from the end. And this is where most startups fail: They either ride Story A into the ground and have no Story B to grow into, or they’re so hell bent to get to Story C that all they do is scream about their billion-dollar idea while someone else executes on it.
Don’t write your book in the traditional way
One of my friends who is in publishing finally corroborated one of my theories about books. Books are dead — well, mostly dead — not because of changes in how people read books, as conventional wisdom might suggest, but because of the lack of change in how people write books.
As eBooks evolve, writers are starting to edit, update, and enhance their books while those books are live and being sold. eBooks can now be written, tested, moved to a beta, feedback received and changes made. All this happens while this book is, so to speak, already on the shelf and for sale.
This is the definition of a startup in 2020.
In other words, while you should write your Story B ahead of time, you can’t stick to that original story at all costs. The story needs to evolve, and your Story A, via feedback from your customers, is going to tell you how and when to rewrite your Story B.
This is difficult, and it wreaks havoc on your Story B. In my experience, just getting a startup idea from crazy dream to something executable changes Story B dramatically. A Minimum Viable Product, a pilot, a beta, a launch, and the learnings that come with those things also change Story B . It’s not a matter of “if,” but a matter of “how much.”
If you’ve ever wondered why a company wrecked a perfectly good product with a lot of crap it didn’t need, while removing features that were actually useful, this is why.
Trying to stick to your original plan when the results are telling you something different is the corollary of the traditional definition of madness. But we entrepreneurs get it in our heads that, six or 12 or 24 months ago, we had the perfect path to the billion-dollar idea. The smart entrepreneurs pivot, quickly and often.
Live Story A every day
The most important part to remember about startup storytelling is that you tell Story B and Story C, but you live Story A.
Don’t fill your team’s heads with the awesomeness and rewards that will come to fruition when Story A turns into Story C. Story C is motivation, Story B is the future, but the only thing that will get you there is full-time focus and cold-blooded hard work on the current Story A.
This is where the communication from company leadership to the team is critical. Over-emphasizing the planning and the dream can reduce the impact of the work. Under-emphasizing the planning and the dream can make the work seem pointless.
So write your three stories and revisit them often. What you write in those stories has to be on point. How you write those stories will determine if you’re a leader or just another unicorn wanna-be.
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