How good storytelling can benefit your cannabis company

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Thanks to President Biden’s decision to order a review of marijuana scheduling under federal law and to pardon people in prison on MJ-related offenses, cannabis industry equities enjoyed a boost.

Whether the good times will roll remains to be seen.

Odds are, more states will approve recreational cannabis use over time.

In that case, whether your marijuana firm is closer to new entrant, startup, growth or even maturing, this is a good time to look at your company’s story to be prepared when opportunity knocks.

Although we think of stories in terms of investors, companies have multiple stories (marketing, brand, suppliers, history, etc.).

Stories are used to share knowledge, to inspire action and instill confidence. In fact, story techniques can be used in just about every part of the enterprise.

One size doesn’t fit all, but every version springs from the same place. Considering organizations and audiences evolve, this might be a good time for a tune-up to keep up with that evolution.

One aspect to keep in mind is your audience.

Crafting a story around what the audience wants to hear is essential. For example, your investor story might need some modification for the Chamber of Commerce lunch.

Many organizations have various plug-and-play components, interchangeable to suit different audiences including new hires, a component of your branding and messaging, potential investors, market influencers, etc.

Differentiation is a good place to start. What makes you unique?

Since you have a great mission statement (one sentence, very clear and easy to remember), why not begin there?

Consider taking a moment to humanize your story. From Hewlett and Packard in a garage to Snoop Dogg and Casa Verde Capital, origin stories are often interesting, sometimes captivating and can give your story heart.

A brief history of how and why your company got its start can help set an emotional hook.

Thinking of investors but with other audiences in mind, ending your beginning with a repeat of your mission statement is a perfect segue to the problem your company solves.

Now, you have a perfect lead to turn the spotlight on yourself as a problem solver.

What‘s your big idea or key value proposition?

What makes you the best solver of the problem?

Have you developed innovative technology that addresses a chronic industry issue?

Found a way to improve existing outcomes by a significant margin?

The temptation is to bring in more than one big idea. The risk is dilution of your most important message. Focus on your single big idea and its value – to your customers, in your market or to the industry.

At this point, who your audience is will determine how your story goes.

Investors and other stakeholders (new hires, prospective advisors, etc.) expect information about your target market, including where demand for your product will come from and how large that demand is or may become.

The temptation is to provide more detail than necessary. Good stories are long enough to cover the subject, short enough to be interesting.

Some storytellers follow the 10-20-30 rule: 10 slides, 20 minutes, 30-point type (Guy Kawasaki).

Other versions of your story might not include some or all of the details about your target market, so this part of your story can be tailored to various audiences.

Of course, you have competitors, one of which is the status quo. If your potential customers have the problem you’re solving, they probably are currently solving it a different way.

Your marketing messages help inform your discussion of competitors. Keep in mind the best solutions don’t always succeed.

In the words of economist Joseph Schumpeter, “resistance (to innovation) manifests itself … in the difficulty in winning over consumers.”

This is your opportunity to articulate why your solution is better, emphasize your differential advantages and why your innovation is so compelling that behavior will change.

If you’re a first mover, be sure to include how long your advantage will last, how difficult your innovation is to duplicate and how you can insulate yourself from “me too” entrants.

There’s a truism in capital acquisition that investors, particularly in early-stage companies, buy great teams as much as ideas.

In the relatively new cannabis industry, deep strength in your senior team is a great point to include in your story.

This same point can be convincing for non-investor audiences as well. Deep strength can inspire confidence in your employee base, appeal to new recruits and support your branding and marketing efforts.

While not necessary for most audiences, for investors, knowing how much detail your audience expects is especially important in your financial summary.

A detailed five-year financial spreadsheet is probably overkill. A high-level financial summary that parallels your business model realistically might or might not be an effective teaser inviting further discussion.

Remember, the idea for your story is to capture interest and generate enthusiasm. An articulate, believable summary based on pre-presentation research can do the job. In-depth due diligence can come later.

Where you’re planning to be as you execute your business model and the milestones you set for yourself will be of interest to many audiences, tailored of course to the outcome you want.

Great detail is not as important as a confident discussion of your model, what milestones you need to reach, your timeline and what makes you confident that you’ll hit your targets.

While ending your story for general interest audiences might be as simple as saying thank you or inviting questions, investor endings can be more precise and depend on what your relationship with the investor is.

Building on your milestones, a projection of your investment needs to be followed by a brief statement of why this is a good investment and an invitation to join you in your quest is a good way to leave the door open for further discussion.