We all love a good story--a great plot, compelling characters, a challenge that the protagonist has to overcome, and an ending that makes us feel satisfied.  Stories serve many purposes--to explain, to entertain, to inspire--but for entrepreneurs stories help to craft an identity that gives the new venture legitimacy in the eyes of investors, competitors, partners, and customers.  What I mean by this is that for entrepreneurs to secure the resources they need to launch and successfully operate their businesses, they have to be viewed as legitimate members of the business community and that doesn't happen easily.  Legitimacy means that the products and services you offer through your company are viewed as appropriate by the industry in which your business operates so that industry members will trust you and deal with you.  The reason legitmacy doesn't happen easily is that new businesses have no track record or reputation upon which to build trust.  As a first-time entrepreneur you're an unknown, and don't forget that most people, investors included, are risk averse to unknowns.  If  you don't have external validation of your company through sales, partnerships, and so forth (and chances are you don't at launch), you have to have alternative means--a great narrative--to make the case that your venture is appropriate and worthy.

Let's take a simple example.  One of the resources you may need for your new business is capital (did I say MAY need?)--one of the resources you WILL need is capital.  Now suppose your business requires capital beyond what you personally have available.  To secure that captial, you are going to have to convince a potential investor in clear and easily understood language that your business is worthy of an investment and YOU are worthy of trust.  You can do that by telling a story that conveys in a clear and compelling way who you are, why you are the one to start this business, what problem you're solving, and how you plan to do it .  The story must be aligned with the beliefs of the investor, in other words, what the investor expects to hear. Entrepreneur extraordinaire Jim Clark's story is unique.  It's a story that has Clark, the protagonist, starting three technology companies that each grew to market values in excess of $1 billion--Silicon Graphics, Netscape, and Healtheon. According to the best-selling book about his story, The New New Thing, [Clark} "was the man with the nerve to invent the tale in which all the characters--the engineers, the VC's, the managers, the bankers--agreed to play the role he assigned to them."  And he always made sure that his stories had a happy ending.

What compelling story can you build around your business?  Does it grab attention and give you the legitimacy to secure the resources you need to launch?  Make sure that it does and you may have a Jim Clark-type happy ending.