Let Me Tell You a Story.
It isn't about having the best idea. It’s about being the best at conveying the idea you have.
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Now to today’s piece 🤝
Language is a funny thing.
In English, “history” is defined as a chronological record of significant events (such as those affecting a nation or institution).
Meanwhile, “story” is defined as one person’s account of incidents or events.
History implies some objective truth, a string of real, concrete occurrences. Story sounds subjective, skewed by the narrator’s perspective.
The Encyclopedia Brittanica contains history. The Harry Potter series contains stories. World War II is history. Anne Frank’s diary is a story. You get the idea.
Spanish, on the other hand, doesn’t separate “history” from “story.” In Spanish, the word "historia” represents both. They’re synonymous.
Cuál es tu historia?
What’s your story?
We tell ourselves that our lives are rooted in science. Objectivity. Everything can be quantified, and stories were just our way of understanding the world before science provided better evidence. But we now live in a post-story world where every occurrence dating back to the Big Bang can be explained by logic and facts.
Stories are dead, while rationale and reason reign supreme. This idea sounds intelligent. Enlightened, even.
But it’s not true. The truth is that stories are all we have.
Science hasn’t replaced our stories. Science is our stories. The Theory of Evolution tells the story of our species, and the Big Bang Theory tells the story of our universe. Math itself isn’t some “thing” that exists. Math is a story that we created to organize the world around us.
Stories are just as real as time and space because they are our only way of understanding time and space.
The Spanish were right: history itself is just a never-ending string of story after story. And there is no singular “history,” because history depends on perspective. Ask 100 people “What was World War II?” and you will receive 100 different answers. To a German in 1939, it may have been revenge for the Treaty of Versailles. To a Brit, it was a fight for survival against the Axis powers. To an American, it was retaliation for Pearl Harbor.
Our broad segmentation of time into different empires, kingdoms, eras, and wars isn’t “history.” Like the backdrop of a Broadway theater, those eras are just the settings for various plays. History is everything that happened in between. History is the stories of the people.
Stories don’t just help us understand our world. They help us understand ourselves. They connect our past, present, and future by showing us where we’ve come from and where we’re going. Our dreams, goals, and aspirations are stories that provide a North Star for our lives. Our pasts, from our successes to our failures to our relationships to our traumas to everything in between, define who we are now.
Stories are timeless: our ancestors were painting in caves thousands of years before we could write, and we now write journals and preserve time capsules so future generations will know our stories from today.
With eight billion people on this planet, stories are the threads that tie us all together. Harry Potter has been translated into 85 languages, from English to Catalan, because good stories are culturally agnostic. They transcend language, skin color, and geography, because they precede all of these things.
Every human who has ever lived can relate to stories of love, fear, anger, success, and failure because these tales embody the human experience.
And the most personal stories create the strongest bonds.
Strangers become friends through shared experiences that become stories retold at bonfires for years to come. Chance encounters become first dates become relationships become weddings that culminate with brides and grooms telling “the story of us” at their rehearsal dinners.
And the desire for stories transcends the desire for everything, including the highest levels of wealth.
Everyone wants to be rich. But the rich? They want to tell stories.
Ryan Holiday is a prolific author, and his fame has brought him in contact with countless millionaires and billionaires. Do you know what they all have in common? Every single one of them wants to write a book.
Marc Andreessen is worth $1.7B. He launched a Substack two days ago.
Will Smith hired Mark Manson to help him write his biography.
Once you have everything, stories are all you have left. And because stories are so crucial to our being, because we are so enthralled by stories, the ability to tell good stories is invaluable.
A quote often attributed to Joseph Stalin says, “One death is a tragedy, but a million deaths is a statistic.” And it’s true.
In the book Made to Stick, Chip and Dan Heath conduct an experiment where Stanford students are told to prepare a 1-minute speech on whether or not non-violent crime is a serious problem.
The average student used 2.5 statistics in their speech, but only 1 in 10 students tells a story.
When it came time to remember the presentations 10 minutes later, only 5% of the audience could recall any individual statistic, but 63% of the audience could remember the stories.
Telling the story of you, the worker, is the key to landing a new job or promotion. Telling the story of you, the partner, is how you charm your lover. Telling the story of you, the founder, is how you raise money from investors. As author Morgan Housel says, “The best story wins.”
We think that investing is a game of math and calculations, but stories are the coefficient by which all of the numbers are multiplied.
Tesla sold 1.3M cars in 2022 and generated $81.5B in revenue. Toyota sold 10.5M cars in 2022 and generated $271B in revenue. Tesla is worth $605B. Toyota is worth $352B. Why, despite selling 9M fewer cars and generating $190B less in revenue, is Tesla worth double Toyota?
Because Toyota sells cars, and Tesla sells stories.
Tesla is leading the fight against climate change. Tesla is David against Goliath. Tesla has a charismatic, wunderkind CEO. Tesla is the future. Tesla is changing the world.
And when you invest in Tesla, you invest in all of these things.
Why did GameStop’s stock price climb from $10 to $400 in a matter of weeks? Did the net present value of its future cash flows increase by 40x in 20 days?
No. Investors loved the story of retail “getting back” at Wall Street.
Stories don’t have to be rational. They aren’t supposed to be rational. A good story is post-rationality. Good storytelling isn’t about having the best idea. It’s about being the best at conveying the idea you have.
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Some of my best friends in business school are from Latin America, so I’ve started reading more and more about the startup scene in their home region. LatAm Startups has been my go-to resource for staying on top of the most interesting companies being built in the Americas. Each week, Manuel and Diego provide brief, 2-3 minute coverage of one of the coolest start-ups in the region. Want to check it out? Sign up here.
Noah Smith wrote a banger on why we need to stop being Doomers. (He’s right, it’s lame.)
Shout out to Vanguard’s CEO for defending their decision to pull out of a climate alliance for ESG funds.
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