Since the brand is functioning mainly on a subconscious level, it is difficult to gain real insights on its influence by the methods of a simple interview. However, the questions did reveal interesting aspect of what people think the role of brand-ing is in this context. MP6 tells about how angel investors tend to explain what influences the gut-feeling that leads to the investment decision.
I know a lot of private investors and business angels and they can’t answer that question, they just talk about how the presentation was credible and the numbers were in order, the team was in order, goals were clear, good vision and the product development has good metrics and so on. But honestly you can count with the fingers in one hand how few has said that brand had any influence to it. Because it is subconscious, and they don’t know how to say what it is. I believe if you would ask some 50 plus angel investors if the logo or others influenced the decision, they would say that if product and service are good then it has no significance.
But that’s not how it goes! (MP6)
MP1 agrees with MP6 by listing that the investors are interested in the numbers, the kind of clients you have and the team, adding that a good investor is not interested in the brand related things such as how your website looks like. Both MP1 and SF2 say that the brand is more important for a company operating in consumer markets than for companies in deep tech or B2B.
If you are a big consumer brand and start selling to thousands of people, then the nicer you can make it look will result in more people getting interested and want-ing to buy your product. (MP1)
Even the sceptics acknowledged that there are some invisible factors influencing the startup valuations that seem to go far above what one might expect. AI1 ex-plains the struggle in understanding these forces.
This is the basic question I am currently pondering too, that how this gap could be expanded. Why are people paying several millions for a three-person company when there is nothing else than the three guys and a laptop? (AI1)
According to AI1 the mechanism behind this is called the invisible balance-sheet which consists of the people in the team and their qualities which gradually start contributing more and more to the visible balance sheet as the company grows.
The question of whether the brand could be oriented specifically towards the in-vestors was met with a strict answer from AI1.
It starts with the thinking that we have a visible and invisible balance sheet in the company. And the thing you are saying is that the invisible balance sheet could somehow be faked, and that maybe works in sales but not in a long-term relation-ship like this. (AI1)
Both AI1 and MP1 are adamant in their views that there are no tricks in present-ing the brand in a more favourable way to the investors.
You can’t fake for very long. There are no brand tricks or tools that you could use in selling yourself to the investors. They are ultimately investing in the business that revolves around numbers and those are hard to fake. (MP1)
AI1 admits that the brand surely influences by raising the interest of the investor and goes on describing how branding could benefit the startup in this context.
If we think of building the image or the brand towards the investor, then if you could bring these things realistically along like this is how I have been operating and this is how I am. So, then he is building like a real image and not a so-called brand-image. (AI1)
On a similar tone AI2 tells that the brand’s integrity has a major influence on how credible the startup appears to be. He explains that if, for example, the tone of voice in the presentation material differs greatly from how the team communi-cates, it gives an image that there is likely some added extra that is not sustainable.
A coherent brand in turn makes it easier for the investor to understand the case and make the subsequent investment decision.
Then if its well-thought, starting from the first slide everything is coherent, the colour schemes, logo, firm name, slogans, pictures, when the story is coherent you get a grip of it easier and it is easier to buy it. Then it is probably easier for the clients to buy it too. If it is a confusing mishmash that is difficult for me to under-stand, then I don’t think anybody else will understand it either, so I’m not going to invest in it. (AI2)
7 DISCUSSION
This study set off to define the best practices for brand building in startups by interviewing marketing professionals and startup entrepreneurs. The second ob-jective was to describe the content and process of brand building in startup com-panies. The third goal was to examine corporate branding in the context of ven-ture funding in order to explore the possible connection between branding and angel investor decision-making. The empirical data for this study was collected through a qualitative case study where thematic interviews were had with mar-keting professionals, startup founders and angel investors. This chapter will dis-cuss the findings of the study by reflecting them on the theoretical framework and finally combining the empirical data with the extant theory to answer the research questions. Based on the findings, some theoretical and practical impli-cations will also be presented. In the last part of this chapter the limitations of the study are discussed and topics for future research are suggested.
Early on in this study it became apparent both in the literature review as well as the empirical research, that the usage of vocabulary around brand build-ing is rather colourful and there is a significant lack of common definitions for the term. However, it was delightful to notice that although the interviewees used slightly different terms, they were still clearly talking about the same con-cepts that were previously discussed in the academic literature. Next, the descrip-tions given by the interviewees are combined in Figure 10 with the brand build-ing model of Rode & Vallaster (2005) to visually illustrate what is meant by the corporate brand in this study.
In general, the empirical findings fit well with the multifaceted nature of corpo-rate brand described in the literature, but one thing stood out from interviews with marketing professionals. Many of them began defining the term by specifi-cally stating that the brand is not the logo and it is not the visual identity. While acknowledging that the visual design does play a role in brand building, its sig-nificance was heavily downplayed by many of the practitioners. This is likely a counter-reaction to the popular misconception where brand is seen only as a su-perficial fabrication manifested in pretty visuals and a cool logos. Both the theo-retical and empirical findings supported a more profound and holistic view of brand building, very much the opposite to the simplistic and visually focused popular view.
The interviews confirmed the observations of Wong & Merrilees (2005) who pointed out that the lack of knowledge on branding and the general dislike of the term can hinder brand building in SMEs. In part, this research aims to al-leviate this problem by familiarizing the reader with what brand building is and
Figure 10 Visual definition of corporate brand
what are the benefits it can bring for a startup. To further clarify the meaning of corporate brand in the context of startups seeking venture funding, the following working definition is formed:
Corporate brand of a startup is the unique set of emotional associations that form the core of a shared internal identity and define the founding team’s image in the minds of external stakeholders. In practice the brand manifests in what the team says, does, how the startup looks like and what kind of story it tells.
Now that the table is set with a proper definition of the core concept, we can move on to discuss the first research question which provides a set of practical guidelines for brand building in startups.