What's your story? Six strategies for entrepreneurs

December 17th, 2013 in Other Sciences / Economics & Business
What's your story? Six strategies for entrepreneurs

An entrepreneur's backstory plays a critical role in the success or failure of a fledgling venture, says Lianne Lefsrud, a postdoctoral fellow at the University of Michigan Ross School's Erb Institute.

"Especially for with limited financial resources, stories are a way to create resources if you can make sense of the world with your stories," Lefsrud said.

Good stories increase legitimacy and persuade investors and top employees to commit to an organization. She says an inauthentic story could be worse than none at all.

Stories in startups and small businesses are often tied to their founders, including those about the "two Steves" of Apple Computers (Jobs and Wozniak) who worked out of a Jobs' parents' garage to start the multibillion dollar company, and of Jamsetji Tata who created India's Tata Group by buying up a bankrupt seed oil mill with a small amount of leveraged capital.

In each case, the stories told by the founders and retold by their followers and admirers helped the small, new businesses to grow.

In a new paper, Lefsrud and co-author P. Devereaux Jennings of the University of Alberta offer six strategies entrepreneurs can employ to create, refine and deliver their stories:

Stories can only take one so far, however.

"You need a good product, you need the credibility to attract investors," Lefsrud said. "No venture capitalist is going to give you money simply because you're a good storyteller."

Provided by University of Michigan

"What's your story? Six strategies for entrepreneurs." December 17th, 2013. http://phys.org/news/2013-12-story-strategies-entrepreneurs.html