Most ambitious entrepreneurs know they need to cover all the classic business bases before an investor will even give them the time of day, notably: “…a great product, a clear understanding of the market, the opportunity and their audience, a sound financial strategy, a tight plan for how the funds will be used, a competent team and a secure exit plan.” Here's What's Brewing in the Minds of Startup Investors (source: Entrepreneur.com, 2023).
So, when all other things are broadly equal, what special sauce is available to startups? Again, investors are clear on this point: “Given two companies with similar projected returns, what makes an investor choose one over the other? Your story. Investors are people, not robots, and they can be swayed by a great narrative about why this business matters to you, where the idea came from, and where you’re planning to take it.
What (human) need is your business going to meet? How will it change the world?
What makes your brand special?”
What Do Investors Look For In A Partner? (source: AO Fund, 2023)
Effective branding, then, plays a critical role in securing investment for - and maximising the evaluation of - businesses both young and mature. A strong brand can help build credibility, establish trust and differentiate a company from its competitors. These factors can be especially important when seeking investment from potential investors who may be evaluating multiple startups.
Investors want to see that a company has a clear and compelling value proposition and a strong market position. A codified and well-executed branding strategy can help communicate these aspects of a business in a compelling way. For example, a strong brand can:
Communicate the company's vision and mission:
A well-crafted brand identity helps investors better understand a startup's goals, values and aspirations.
Build credibility and trust:
A powerful brand often signals that the company has a recent track record of success and is committed to quality,
reliability and innovation.
Create differentiation:
A memorable brand will boost a young company’s chances of standing out from its more established competitors and demonstrating its competitive advantage.
Enhance market position:
A purposeful brand personality can help a startup attract and retain customers, which can translate into higher revenue, profitability and market valuation.
All of these factors make a company more attractive to investors, as they demonstrate that it has a clear and compelling strategy for growth and success. In addition, an own-able brand voice helps a company create a sense of momentum and excitement, which can be particularly important when seeking funding from early-stage investors who are looking for the ‘next big thing’. Sounds good, right?
So, what’s the catch? Well, branding can be a lengthy – and eye-wateringly expensive – process if you’re not careful. Media stories of megabrands tweaking their logo for megabucks are legendary. But it doesn’t have to be pricey or painful to work with branding experts who will help you get your young brand to a good place. On the contrary. There are some very talented, agile, independent branding and communications agencies out there that not only respect the process but also know The Struggle™ all too well.
Nothing against the big agency players – I’ve worked for a few of them – but a relatively fresh startup just isn’t going to get the service levels or value-for-money it so desperately needs from a 50+ person creative agency with a swanky reception and blue chip client list. It’s all about doing your research, finding a good cultural fit and being open to the road less travelled.
Ask around for a recommendation, arrange a kick-off chat, get some mentoring, discuss options, have a discovery workshop, maybe even offer a bit of equity in lieu of some of the brand development fee. You’ll be surprised at the value that can be gained from constructive collaboration with the right people who get you. If the mood takes you, maybe even give us a call! We do a lot of this stuff at and are proud to have been part of some inspiring success stories along the way.
All that remains to be said then is: Take heart and travel well, my fellow entrepreneurs, for the journey of a thousand miles begins with but a single step… just don’t forget the Brand.
Paul Cope, Managing Director, The Creative Lab
your start up's special sauce
Written by: Paul Cope MD at The Creative Lab
Reading time: 5 minutes
From a great idea to commercial success... don't forget the Brand
An encouraging economic stat hit the news last month, almost hidden amongst the relentlessly grim headlines we seem to be getting used to: 202,130 new businesses were set up in the UK in the first 12 weeks of 2023, a year-on-year rise of 6.5% (source: Startups Magazine / Koozai / ONS). That's a new record, even with rising costs hitting bottom lines across the board.
Sadly, despite this entrepreneurial optimism, 2022 was a bad year for UK business dissolutions. A staggering 876,521 were struck off the Companies House register – also a record – a rise of 8.6% on 2021.We clearly have the talent and enthusiasm. It's very difficult to start a viable business, don't let anyone tell you differently. But even when accounting for tricky trading conditions and the 'Lockdown Startup' phenomenon experiencing an inevitable pinch point, that dissolutions number is particularly shocking. Just what is going wrong?
Now, I know what you're thinking... but don’t worry. I'm not going to claim that devising a distinctive, tightly researched and data-informed brand positioning is the silver bullet that would've kept those 876,521 businesses trading in 2022.
Or will be the ultimate key to success for the 202,130 companies set up so far in 2023. Startups, in particular, fail and succeed for way more reasons than I'm going to attempt to list here. Often bad ones do OK and really good ones go under. Go figure.
What I am going to posit, however, is that without a strong brand, establishing and growing a fledgling business is a whole lot harder... and yet it so often gets overlooked. The business community is actually pretty definitive on this: “You'd be amazed how many startups attempt to build business momentum without a brand. Or, just as bad, they slap together a brand in a few minutes thinking that it will be enough to support their business. Many novice entrepreneurs have a misconception that your company's 'brand' merely refers to simple identifiers, such as your company name or logo. However, your company's distinctive voice is just as important.”
The Biggest Branding Errors Most Start-Ups Make (source: Entrepreneur.com, 2017)
Take funding, for example…
Investment in a startup is, more often than not, the input that super-charges its growth to the next level. Getting the right person or entity on board at the right time with a big bag of cash can be a game changer (just ask Levi Roots!)