Interesting piece by @kevinakwok coining a term I've been looking for: "narrative leverage" as the ability to lower cost of capital, attract/retain talent, and acquire customers.
https://twitter.com/kevinakwok/status/1443311835629895686
"The best founders have figured out that owning their narrative gives them meaningful leverage. Founders and companies can increasingly communicate their narrative in a direct and compounding way to investors."
Types of fundraising pitches: narrative, inflection, and traction raises.
Narrative: compelling story of what could be
Inflection: secrets discovered.
Traction: driven by the results
Narrative: compelling story of what could be
Inflection: secrets discovered.
Traction: driven by the results
"What the top VC firms are selling today isn’t money—they’re lending their own brand to startups. Having Sequoia invest will lend the stored PE ratio of Sequoia to the portfolio company. This will help give them a cheaper cost of capital, recruiting, and customer acquisition."
"In today’s ecosystem, however, companies are increasingly able to have as much, if not higher, narrative leverage than VC firms. The top companies—and especially their founders—are more known than their VCs."
"Narrative leverage is not just an advantage on the cost of financial capital.
Historically, capital was the scarcest resource. Talk to top tech companies today and raising capital is one of the easier aspects of building. Hiring and retaining a talented team is far harder."
Historically, capital was the scarcest resource. Talk to top tech companies today and raising capital is one of the easier aspects of building. Hiring and retaining a talented team is far harder."
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