Heroes, Villains, and a Happy Ending in a Fundraising Story

Two posts ago, I mentioned that startup fundraising begins with telling a good story. It needs three things: to be engaging, credible, and concise. #CreatingAnEngagingPlot Think of watching a movie. Hollywood’s Marvel films are probably among the best at creating engaging plots. Beyond the visuals and the suspense and excitement, they also follow certain formulas. Experienced Marvel fans need only watch the opening to get a rough sense of the characters’ roles and where the plot is heading. Developing a compelling storytelling framework is much like constructing a movie plot. A good business story needs a particular set of elements, organized according to a recognizable formula. For an entrepreneurial story, the most suitable structure is the familiar battle between a hero and a villain, followed by a happy ending. That sounds overly simple, but it really is that straightforward. The formula’s fundamental power lies precisely in its simplicity. What matters most in a movie is whether the plot draws people in. The same applies to your entrepreneurial story. To tell an engaging story, find these elements: a hero, a villain, and a happy ending. Together, they can create an exciting story. There have been so many Superman films, yet people still love this kind of superhero. Why? There is a hero—Superman—and a villain—his archenemy, ABC. In the end, good defeats evil and everyone is happy. The same pattern runs through Captain America, Iron Man, Batman, Spider-Man, Star Wars, the Avengers, and other superhero stories. Every hero has a formidable opponent. The two forces finally confront each other, the hero wins, and peace returns to the world. Who is the villain in an entrepreneurial story? In business, it is no longer a particular person. It might be hunger, ignorance, disease, or waste. Which villain do you and your company want to conquer? Inefficiency? A life-threatening health problem? A poor customer experience? If your business idea has no clearly defined villain, you cannot raise funding, because you cannot solve a real-world problem. This is the first step on the long road to financing. The hero works the same way. It might be food, romance, entertainment, health, or more time and energy. When the hero defeats the villain, we reach the story’s happy ending. With the formula in hand, let’s see whether successful companies have used it. Who is the villain in Google’s business story? The lack of ways to access information. Many people feel, “I know the answer is out there somewhere, but I just cannot find it. So I still know nothing about this question.” Who is the hero? Google’s search algorithms and technology, providing users with all kinds of information. What is the happy ending? Hundreds of millions of people making tens of billions of Google searches. That process created one of the most profitable companies in business history. Now consider ride-hailing software. Who is the villain? People want a ride but cannot find one. Who is the hero? Uber. And the happy ending? Everyone can get a ride, cars no longer sit unused in parking lots, and people who want to earn money can make extra income. The same applies to your entrepreneurial story. First, identify the villain you want to conquer. That is it: with these three elements, you have built the framework for a good story and created an engaging plot. How important is that plot? If the three elements are sufficiently persuasive, investors may sometimes have decided to invest by this point alone. ---- Great business stories are never pure fiction. Investors might laugh at a fictional story, but they will not invest in you. If your business story is exciting, the next step is to substantiate its plot with examples and factual research. For instance, tell your investors the following story with feeling and vivid detail: It is 9 p.m. You have finished work for the day. You stand up and look around the nearly empty office. You throw your phone and keys into your bag, swipe your access card, and leave. The day has worn you out. You spent an hour on the phone just to calm an important client down a little. Your boss ruthlessly criticized copy you had spent days writing. Exhausted and dazed, you drag your heavy legs toward the subway station. Only then do you remember that you still have no plans for dinner. Nobody is waiting to eat with you at home. You cannot ask friends to come out and eat with you now, and you have absolutely no energy to cook. At that moment, you feel abandoned by the whole world. By this point, your investors will feel as though they are that miserable office worker: tired and hungry. Your villain must feel real, vivid, and human. Add some imagination to researched facts, and the villain becomes emotionally compelling. Now is the moment to reveal your hero: “a food-delivery website.” You have described the villain vividly and in detail. Remember to make an equally thorough case for the hero. Why can your hero defeat the villain? For your food-delivery company, what sets it apart from competitors? Breakthrough technology or service innovation? How do those advantages solve the problem? After an intense battle, the hero finally wins. The hungry, miserable office worker takes out a phone and orders from your food-delivery website. Soon, a delivery rider appears like an angel. Even without a wife to cook, the worker can enjoy a comfortable dinner. Your investors can finally breathe a sigh of relief. That is a persuasive happy ending. Heroes and villains both need detailed treatment. What, then, does the happy ending require? A reasonable market forecast. How much market share do you expect to gain? How long will it take? How much will you spend? How much will you earn? And what is the basis for all these projections? Your forecast must be supported by sound reasoning and evidence. #得到聽書 (Dedao audio book summaries) #創業融資從一個好故事開始 (Startup Fundraising Begins with a Good Story, descriptive title)