Stories that get the working money view the opportunity through a wider lens and demonstrate to potential partners the organization is operating with a clear view of the opportunity and conviction in how that opportunity will be realized. It is clarity with conviction on big ticket opportunities and the larger human imperative associated with it.
VC start-up funding is down to its lowest level in five years, both in deals and dollars. So how is it that fans of SaaS Brand Strategy are getting deals despite historic headwinds?
It’s because they have a clear, concise, and compelling story to tell and sell about their vision and the quest the company is on with its partners. In short, they aren’t pitching investors on a product, they’re pitching potential partners aligned with their vision of the opportunities emerging for fundamental and profound shifts in human behavior and the resulting market opportunities that arise with that. The product is the conduit through which start-ups will take advantage of that shift.
How that case is made can be make-or-break when it comes to securing financial support. As Don Valentine, Sequoia Capital’s Founder said, “Learning to tell a story is critically important because that’s how the money works.”
Stories that get the working money view the opportunity through a wider lens and demonstrate to potential partners the organization is operating with a clear view of the opportunity and conviction in how that opportunity will be realized. It is clarity with conviction on big ticket opportunities and the larger human imperative associated with it.
To wit… Adam Neumann of WeWork collapse infamy (not a DRMG client...) was still able to raise $350 million from Andreessen-Horowitz for his new residential real-estate idea, called Flow. Massive investment came not because he is selling real estate, but because he was telling and selling a story about his vision for how the world will be different and, as we say about strategy, will leverage fundamental and profound cultural shifts and technology to hack emerging or latent human behavior for competitive advantage. A much more impactful approach than, “Hey do you want to invest in timeshare condos I own?”
During a recent retreat for a non-profit board I am on, I realized start-ups can learn a lot about raising new rounds of investment from how non-profit development professionals secure sizable gifts. They do it through a combination of Narrative and Analytical persuasion.
In psychology, Narrative Transportation Theory proposes that when people lose themselves in a story, their attitudes and intentions change to reflect that story*. Development directors draw donors into the story, literally and figuratively, through a compelling narrative about the change in the world, the problem they solve related to that, their vision for the future, and the resulting legacy available for those who participate. Donors see themselves as an integral part of the narrative and the solution or outcome.
The Analytical persuasion provides the objective data and facts to support the truth that the non-profit’s quest is worthy and feasible, with feasible the operable word. “There are only a rare few people who appreciate the immense need and opportunity. We can only realize this with your support.”
It is a wicked combination of enlistment through rational and irrational exuberance.
For start-ups, a Narrative and Analytical story which challenges assumptions and conventional wisdom through customer and market insights, objective third party endorsements, higher level understanding is what differentiates you from becoming the 120th “We’re the AI of XYZ” product-led pitch the VC will review this week.
And given the flood of new AI-related start-ups looking for support and leading with their "We're the AI for XYZ" product-first pitch, the need for a differentiated story to tell and sell will become more essential than ever.
“Product differentiation is going away. Act accordingly.”
In the world of B2B SaaS, the excitement of creating a new category must be tempered with the reality of clients' immediate needs. By balancing long-term vision with short-term solutions, companies can ensure their category strategy supports, rather than hinders, their sales efforts. This approach not only helps in closing deals but also builds a foundation for sustained success in the new category, enhancing SaaS positioning effectively.
Read More →Following the launch of the Spatial Computing category, Personal Intelligence System is the second recent example of Apple embracing and crushing category strategy.
Read More →Schedule an in-person clinic on DRMG's Category Strategy.
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