There is a long-standing debate in creative writing circles about whether storytelling is an art or a craft. I begin this chapter with a very quick introduction to valuation, not so much to delve into the theory, but to link value to key drivers that cut across businesses in different industries and different stages in the corporate life cycle. Damodaran also looks at more established business models such as Apple and Amazon to demonstrate how a company's history can both enrich and constrain its narrative. At the very beginning, I made a confession that I... JSTOR is part of ITHAKA, a not-for-profit organization helping the academic community use digital technologies to preserve the scholarly record and to advance research and teaching in sustainable ways. In the chapters leading up to this one, I have focused primarily on individual companies and talked about how stories about these companies drive their valuations. by Aswath Damodaran. It is a question that I start my valuation classes with, and for most of us the answer usually comes easily, because in this age of specialization, we are forced to choose between telling stories and working with numbers early in our lives, and once that choice is made, we spend years not only increasing our skills in that chosen area but also ignoring the other. By continuing to use this website, you consent to Columbia University Press’ usage of cookies and similar technologies, in accordance with the Columbia University Press Website Cookie Notice. Why do some start-ups attract large investments while others do not? Why do some start-ups attract large investments while others do not? In business, few things ever happen the way that you expect them to and it is a given that you are going to be surprised, sometimes in good ways and sometimes in bad. He investigates why Twitter and Facebook were valued in the billions of dollars at their public offerings, and why one (Twitter) has stagnated while the other (Facebook) has grown. If you buy into the common wisdom of the left brain governing logic and numbers and the right brain controlling intuition, imagination, and creativity,... We all love stories; we relate to them and we remember them. Aswath Damodaran is a professor of finance at NYU who has written several books on business valuation, including The Little Book of Valuation: How to Value a Company, Pick a Stock, and Profit.. In this chapter, I look at connecting the story to numbers that determine the value of a business. In this chapter, I begin by looking at the history of numbers, tracing their origins from ancient civilizations to the quantitative models of today. In some cases, though, it is stories about the economy, interest rates, or commodities that drive the valuations of individual companies. The ease of access to numbers and tools has also made everyone a number cruncher, with mixed results; as we noted in the last chapter, numbers can be misused, manipulated, or just misread. In this chapter I first introduce the notion of a corporate life cycle with defined stages in corporate evolution and transition points, and then I look at how the connection between narrative and numbers changes as a company ages, with narrative driving numbers early in the life cycle and numbers driving narrative later. narrative and numbers the value of stories in business columbia business school publishing is additionally useful. While there are some aspects of storytelling that cannot be taught, there are many components that are not only teachable but that can be improved with practice. World delivers surprises that alter narratives and the number-crunchers who construct meaningful models and accounts and narrative! Describe the value of stories in business, de Damodaran, Aswath na.. 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