Stories drive the world. There are a lot of people who can explain this quite well. Humans are intrinsically attached to stories. But there's a very important face to stories in modern capitalism. The best companies have been built on top of it. The markets are rational yet extremely irrational.
If you want to hear this from someone else, here's what Sequoia Capital Founder Don Valentine had to say :
<aside> ⚒️ The art of storytelling is incredibly important. Learning to tell a story is critically important because that’s how the money works. The money flows as a function of the story.
</aside>
He believed that when you are in a business driven by optionality, like the venture capital business, investing a lot of resources in creating spreadsheets is a waste of time since the assumptions in it are guesses. The best way to quantify the opportunity is actually with a story.
Chris Sacca puts it this way :
<aside> ⚒️ Good stories always beat good spreadsheets. Before drawing a single slide of your pitch deck, tell the story out loud to anyone who will listen. Again and again. Now you have your deck.
</aside>
The reason stories maybe a good way to quantify opportunity is because at the core of any expression (company, idea, art) is a story. People are the best measure of any company and stories are extremely good with getting people together.
Valentine mentions the flow of money as a function of the story. Firstly, any large project that has massive economic value is bound to a story at first. The capitalists believe in a vision before pumping in resources to realize it. A lot of the capital that flows in the system is public capital. And stories can force large swaths of people to behave in very predictable / unpredictable way. This applies to any form of transaction. Apple clocks mind-boggling number of monthly sales right after their products are released because people are tied together in a genius narrative primarily constructed by Steve Jobs.
The money prefers to flow where there's growth. And historically, growth has only happened through ideas that humans agreed on together. Production and aggregation of resources requires a lot of effort from multiple fronts. Co-operation is the holy grail of capitalism. Co-operation requires incentives. Incentives require beliefs. Beliefs require stories.
Any market is fundamentally driven by humans (atleast, it should be). Capital and economics are a tool to objectify progress and impact. The root of impact, or any behavior for a fact is driven by beliefs and stories.
Apple began with a set of ideas they wanted to express. The money flows towards the ambition of expressing the idea better each year. This also says a lot about the quality of thought before companies begin. Lot of people treat startups very casually but the really great ones are almost always really well-thought out.
This idea of expression is a common theme across capitalists too. Capital is at best an instrument of change. It is driven by the world-view of the people controlling it. And to express an idea tangibly, you need capital. The story and ideas come first. Once you internalize this, all the debate around quality of ideas among politicians seems like bullshit. The only people who're truly expressing views and opinions are the people who can take action. Most politicians in any country are just puppets. There's also distinction observed in performance of leaders with a lot of personal wealth vs the ones who don't.
The money flows as a function of the story because the sole function of the money is to express the story as effectively as possible. This also means, there's a real skill in matching stories and money together.