Humans are natural storytellers, but that’s not just a professional writer’s opinion. Science confirms it: we need to tell stories.
Sharing tales is the traditional way to foster social cooperation and establish norms. And the presence of skilled storytellers in society is correlated with increased generosity and happiness among its members.
On the surface, entrepreneurs might seem to have the least need for storytelling. We associate running a business with motives of pure profit. We think that rational decisions are all that matters in this way of life.
Certainly, entrepreneurship revolves around calculations of risk and profit. The opportunity to franchise a small-town restaurant with a proven track record enables other, more risky ventures and leads to portfolio diversification. Emotions don’t factor into the owner’s side of the equation.
But even if your approach to entrepreneurship is entirely data-driven and strategic, you’ll find that there’s still a strong need to invest in weaving your own narrative.
Narratives of trust
The history of writing is intimately tied up with that of commerce. The earliest written records used clay tablets and denoted specific amounts of livestock or commodities.
Yet humans had doubtless been transacting with each other even before then. We certainly had been using oral storytelling well before writing systems were invented.
The earliest business transactions, in the absence of an efficient system of writing and later systems of credit, had to be conducted based on trust, or creditworthiness.
The anthropologist David Graeber makes similar points in his book, Debt: The First 5,000 Years. Money was invented to keep track of debt and to ensure that those tokens, whether in the form of coins or paper bills, would be widely accepted as having value.
Historically, therefore, establishing credibility was always a core struggle for entrepreneurs. And in the days before global banking and currency exchanges, the best way to do that was through storytelling.
Constantly dealing with people who didn’t know you that well, you’d have to ensure that the right narratives were floating around. Like the mythical Sinbad, a merchant would collect travel souvenirs, maintain correspondences, and curate relationships with the ‘who’s who’ of society to be perceived as trustworthy.
Shaping the story
We now have not only modern credit systems and financial tools but the ability to vet anyone online. Yet are we really so different today?
For all the skills and intangibles they bring to the table, entrepreneurs still stake a considerable portion of the fortunes on reputation.
If the average person tried to launch their first business, they’d face far more difficulties obtaining financial backing than a serial entrepreneur. Consumers can be swayed by the prevailing sentiment of the times, which is why companies now care so much more about sustainability compared to decades past.
However, storytelling doesn’t just matter in terms of a founder’s reputation or the image of their brand.
The real value of a personal narrative is universal: it helps us frame the events of our lives, find patterns, adjust and make decisions we can live with.
This applies to everybody from all walks of life, and it certainly extends to entrepreneurs and the people who work for them. We vary in terms of how much agency we exercise and how actively we take part in shaping our own narratives.
Understand the journey
For entrepreneurs, storytelling is vital because they inhabit a world that’s even more complex and chaotic than the layman’s. No matter how ‘on top of things’ you are, the ground under your feet keeps shifting, and your role within the business you founded will evolve.
Some business owners might eventually see fit to commission a book, work of art, or something else that commemorates their legacy. Doing so can inspire others, embellish your image, and further define the organization’s character.
But the endpoint of your career shouldn’t be the only time you tell a story about yourself. Narratives are there to help entrepreneurs through critical moments.
They can guide you through bankruptcy, aid in formulating an exit strategy, accept or decline an acquisition offer. The fleshing out of your story can also increase your awareness of the people whose sacrifices and assistance made your success possible.
Just like starting a business, you have to determine your medium and audience. What are the key moments in your journey so far? How do you respond to each challenge and involve the people in your life to make progress?
And just like finding the right business model, formulating a narrative that resonates with yourself and others will help you succeed. Not merely in the profitable sense, but in that you’ll get results that align with your personal values.