Startups That Master Storytelling Don’t Just Survive – They Dominate!

Published in Børsen on March 3, 2025

By Cris Hödar-Rasmussen, Creative Director – By the Fire

and Kristian Justesen, Venture Partner – Strive Ventures

Every day, new startups emerge, but only a tiny fraction—less than 1%—succeed in securing venture capital. Those that do gain more than just funding; they gain access to expertise and guidance, typically centered around technological innovation, financial management, and product-market fit.

However, the companies that achieve long-term success and the highest valuations have something even more critical: a compelling narrative.

Storytelling isn’t just branding—it’s a strategic tool that shapes perception and accelerates growth. Paradoxically, it’s also something most venture capitalists understand far too little about.

A Powerful Narrative

Nine out of ten startups go bankrupt within a few years. Even with venture capital backing, only about 50% manage to survive or generate significant returns—and rarely because the product itself is flawed. More often, they struggle to communicate the value of what they offer.

A strong narrative does more than capture attention—it creates meaning. It transforms a product into an essential movement with emotional significance and cultural impact. Without storytelling, Nike is just a sneaker brand; with the right story, it becomes a symbol of status, performance, and identity.

In the startup world, perception precedes reality. A strong story gives startups an aura of stability, innovation, and reliability. This credibility positions a company as a frontrunner before it even proves itself. The result? More customers, top-tier talent attraction, increased media exposure, and the investor confidence that fuels long-term growth.

Take Too Good To Go—at its core, it’s “just” a marketplace for surplus food. But its success is all about storytelling. Rather than selling leftovers, the app turns food waste into a mission, transforming a logistical solution into a global movement.

Its narrative positioned the company as a sustainability pioneer from day one, attracting not only consumers but also policymakers, restaurants, and investors eager to be part of the initiative. By owning the conversation on food waste, Too Good To Go built a brand that felt bigger than the product—long before the numbers could back it up.

Funding is the fuel that keeps a startup running—but storytelling is the spark that ignites its growth.

One of the biggest challenges for startups is balancing growth with efficient capital management. Many bet heavily on marketing, aggressively investing in paid ads.

But without a clear, resonant story, those ads lose their impact. As a result, the cost of acquiring each customer rises—an issue that can quickly become critical for a startup with limited resources.

Emotional Connections

Brands driven by storytelling, on the other hand, create emotional connections that lead to higher conversion rates—by as much as 40%, according to multiple reports. Consumers don’t just buy products; they buy identities, communities, and missions.

That’s why a startup that invests in a strong narrative can spend less on advertising while achieving greater engagement and customer loyalty.

A startup’s story doesn’t just matter in its early phases—it’s also a decisive factor in its eventual exit. When companies go public or get acquired, their perceived value often far exceeds their tangible assets.

Investors and buyers aren’t just acquiring technology; they’re buying into a brand’s market positioning, customer loyalty, and growth potential.

The companies that secure the highest valuations have spent years crafting a story that positions them as industry leaders. They control the narrative long before the numbers appear in financial reports.

When Spotify went public in 2018, its valuation soared past $26 billion—far exceeding expectations. Despite not being profitable at the time, this valuation was largely driven by Spotify’s powerful narrative about democratizing music and revolutionizing how people discover and listen to it.

Investors weren’t just buying into a tech platform—they were buying into the story of a company redefining the music industry. Even with financial uncertainties, Spotify’s brand gave investors confidence that it was positioned for long-term success.

Funding is the fuel that keeps a startup running—but storytelling is the spark that ignites its growth. Especially in today’s world, where attention is fragmented, trust is hard-won, and competition is ruthless, the right story isn’t just an advantage—it’s an absolute necessity.

Startups that master storytelling don’t just survive—they dominate. And for investors looking to back the next market leader, focusing on the story is just as crucial as analyzing the numbers.

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Read the original Op-Ed in Børsen