Storytelling: Key to Engaging Investors

Rob Berick
Rob Berick

A senior leader of a $60 billion-company in New York recently told me her organization boasted a deep and seasoned in-house IR team, one that deftly managed shareholder relationships and answered financial questions. But, she had concerns: This team was unable to craft a compelling story for investors. As a result, she felt the company was not maximizing its value-creation potential. This trouble spot is not unique. We are engaged regularly by companies that think the investment community doesn’t understand them and, as a result, undervalues them.

Storytelling offers this additional value. And, by consistently telling an authentic story, you will make it difficult for activists to mischaracterize you later.

As Gregory P. Taxin, former president of the hedge fund Clinton Group, told The New York Times last year, “The brute force of ownership is not required anymore because the big institutional players listen to both sides and are willing to back the activist fund if they believe in them … [y]ou can win with persuasion and ideas.”

Notice he says, “if they believe in them” and not “if they have proof” or “if they can produce indisputable facts.” Likewise, note that “persuasion and ideas” pave the road to victory, not “concrete evidence” or “reliable third-party and/or proprietary data.”

No wonder then that funds like Barington, Starboard, Third Point and Trian increasingly incorporate whitepapers and other storytelling vehicles in their fight strategies. These funds understand that, in many ways, it’s a war of words when competing for an investor’s capital or vote and the advantage goes to the best storyteller.

Research shows that stories enable us to make and justify our decisions, an important factor in IR. As Pamela B. Rutledge, Ph.D., M.B.A., wrote in a 2011 piece for Psychology Today, “[W]hen facts and information are framed by a compelling story, you’ll not only hold the attention of your audience, but you’ll also make the information presented more memorable.”

She said that, like any stakeholder group, the investment community is not “… moved to action by ‘data dumps,’ dense PowerPoint slides or spreadsheets packed with figures … [n]o matter how compelling your facts are, if your audience isn’t invested in what you’re saying, all the information will be lost on them.”

Nike, for example, understands this. Investors visiting its site don’t encounter typical website boilerplate copy and obligatory financial highlights.

Instead, Nike immediately declares itself “a growth company” and uses content and data to bring that story to life for investors.


Investors have neither the time nor the patience to unpack a company’s value proposition in today’s data-driven, technology-accelerated global markets. They want to know quickly what author Simon Sinek calls the why of the company’s story.

As Sinek explains in his book, “Start With Why,” the all-important why speaks directly to the sections of the brain controlling decision-making. “[We] trust our gut even if the decision flies in the face of all the facts and figures,” Sinek writes.

Numbers cannot speak for themselves, nor should they. Just as you bring your products’ and services’ value to life for customers through storytelling, so too should you use storytelling to illuminate the value you offer investors.

There is an art to corporate storytelling; much of it hinges on what Malcolm Gladwell referred to in his book, “The Tipping Point,” as “the stickiness factor.” Chip and Dan Heath explored this idea further in their book, “Made to Stick,” and determined this requires among other things: simplicity, unexpectedness, concreteness, and credibility.

Corporate storytelling also has a complementary science. First and foremost, you must have a clear-eyed view of your business from the outside in:

1. How do investors view the industry and end markets?

2. What is the current investor base composition?

3. What is the current investor sentiment?

4. What does the gap analysis of the company’s investor engagement vs. peers look like?

5. What does the company’s media coverage look like?

6. What primary external factors influence valuation?

7. How well does the company’s story resonate with investors?

Similarly, you will need to have an unvarnished view of the company from the inside out, such as:

1. How competitive is the company in the marketplace?

2. What is the level of management credibility within the investment community?

3. What is the company’s performance-to-expectations ratio?

4. Can the company clearly articulate its strategic vision?

5. What is the company’s current story and how does it deliver it to investors?

6. What unknown, unrecognized or misunderstood aspects of the company could be assets to value creation if told in a compelling and meaningful way?

7. What does investment audience segmentation look like?

This data—which should be audited and reconciled as regularly as your financial and enterprise risk-management reporting—will ensure that your corporate narrative properly aligns the business and investment brands. This alignment is critical to long-term value creation.

On a daily basis, corporate storytelling can mean the difference between an investment in your company rather than a peer. And, in times of organizational distress, including shareholder activism, effective storytelling can mean the difference between a vote of support and a vote of no confidence.

Simply put, effective storytelling is the key to investor engagement.

The Story Investors Want Versus The Story Investors Usually Get

Investors want to understand quickly why now is the right time to take a position in a particular company. This chart delineates what is highly important to investors versus what companies generally do well in communicating. Too many companies merely report data when investors want the dots connected for them. They want a story from you.

▶ Q&A: 80 percent vs. 41 percent

▶ Review of business strategy: 78 percent vs. 44 percent

▶ Progress achieving key goals: 66 percent vs. 33 percent

▶ Forward-looking financial guidance: 60 percent vs. 30 percent

▶ Capital allocation plans: 60 percent vs. 23 percent

▶ Previously undisclosed insight: 60 percent vs. 18 percent

▶ Forward-looking operational guidance: 56 percent vs. 28 percent

▶ Review of financial results: 55 percent vs. 38 percent

▶ Business segment performance: 51 percent vs. 31 percent

▶ Review of products and services: 41 percent vs. 34 percent

▶ CSR/sustainability initiatives: 16 percent vs. 14 percent

Source: Rivel Research, “A Global IR Best Practices Report, Investor Days 2013” (March 2013)


Rob Berick is a senior VP and managing director at Falls Communications. He can be reached at

This article originally appeared in the February 16, 2015 issue of PR News. Read more subscriber-only content by becoming a PR News subscriber today.