I’m often approached by young, aspiring entrepreneurs who ask some variation of the following:
I’m interested in starting a company in [Industry] that does [Laundry list of features], so where do I start?
They usually want introductions to investors and developers — rarely are they seeking advice. So I respond with a question in turn, something I know they can relate to.
If not already addressed by the entrepreneur in her pitch, what’s the first question the investors on Shark Tank almost always ask?
Everyone knows the answer to that. The sharks ask about the entrepreneur’s story. How did the founder get from doing whatever they were doing to what they are currently pitching? But this isn’t just an important question for prospective investors to ask and for entrepreneurs to answer. It’s important for product owners, managers, and visionaries everywhere, from SMBs to enterprises.
We like to think that ideas are judged at face value. That ‘brilliant’ and seasoned investors can look at any idea or product and say ‘this is going to be big.’ But everything we know about human nature says the opposite. People are notoriously bad at envisioning what they want even when they see it. The sharks are well aware of their own shortcomings which is why they ask for the story.
Paul Graham, the prolific essayist and founder of Y Combinator, aptly writes:
If you look at the way successful founders have had their ideas, it’s generally the result of some external stimulus hitting a prepared mind…Drew Houston realizes he’s forgotten his USB stick and thinks “I really need to make my files live online.
Dropbox founder, Drew Houston didn’t walk around in 2007 telling people that he wanted to or had invented a file hosting system offering a personal cloud as a service. That mumbo jumbo wouldn’t have meant anything to anyone. That’s not to say we were all perfectly happy with emailing files to ourselves and losing our family photos when hard drives failed. But most of us didn’t inherently know we had a problem that needed solving, otherwise we’d all be CEOs of cloud storage companies.
Instead, Drew reminded people about the frustration of leaving USB sticks behind, as he had often done as a student at MIT. And then he talked about this nifty solution called Dropbox. Those who listened felt connected through this shared narrative.
While humans are relatively inept at predicting their future behavior, they naturally connect to stories. Social psychologist and professor of ethical leadership at New York University, Jonathan Haidt, uses the metaphor of an elephant and a rider to explain this phenomenon. The rider, who represents our ‘reasoned processes,’ makes many of the long-term decisions that require logic and practice. But at the end of the day, the elephant, representing our immediate emotional reactions, is in charge of taking the next step.
This is why stories are critical — they invoke positive emotional reactions. Products can’t exist in a vacuum because people don’t evaluate ideas in a vacuum. People evaluate ideas in context. Products and their stories need to illustrate that context in the form of a journey from before, point ‘A,’ to now, point ‘B.’
And telling a story to investors is nowhere near as important as telling it to coworkers and potential users.
An article in UX Magazine caught my eye last month when it posited that storytellers made better product managers than engineers because they aren’t wholly focused on execution.
While execution is of course critical, product development is usually a collaborative process, involving various departments and, of course, users. Having a product manager who is an effective storyteller “ensures that the entire team understands the why behind what they are doing. A common understanding of the product story allows a team to incubate a shared vision.”
This shared vision is evangelized by sales, marketing, and development teams. It’s understood by the C-Suite and all the way down to customer service. It simplifies all the moving parts in product management, because the product mechanics and direction become self-evident. In turn, it becomes the story that users, coworkers, press, and investors engage with from the first time they hear about a product until they are sharing it with all their friends.
So whether you’re an entrepreneur or enterprise product manager, before telling us about your product, tell us about our story.