A biotech or SaaS company wants to be seen as an AI company. A health company wants to be seen as a tech company. Some have earned the label. Many are chasing a valuation multiple, knowing capital flows to whoever carries the tag. We’ve seen this script before. During the dot-com boom, adding “.com” to a corporate name could trigger a speculative surge. A decade later, companies rushed to rebrand around blockchain.
I run a communications firm. Narrative can change how people see a business, but it can’t fix the fundamentals.
STORY MATTERS—TO A POINT
Investors, employees, and reporters invest in stories, especially concerning frontier technology. When a company is building something that won’t exist for years, it can’t point to a finished product. It has to give people reasons to believe. Jensen Huang positioned NVIDIA not as a graphics card maker for gamers, but as an AI computing company years before ChatGPT made AI a household word. NVIDIA’s story ran years ahead of the market, and the company built fast enough to catch it.
Your story can run ahead of your business. That is what vision is for. But it can’t run ahead forever. A good story sets expectations. If the business doesn’t hit the expectation, however, the market responds in many ways: a fall-from-grace headline, a disengaged investor, or a stalled deal.
THE GAP HAS A SHELF LIFE
I call the distance between your vision and your execution “the gap.” Opportunity and disaster both live there. How long you can stay in the gap depends on how many people are watching.
A young company in stealth mode gets plenty of room to maneuver. A well-known brand gets very little, because reporters, analysts, and competitors track every claim. Early on, the story is nearly all you have. Later, especially once you’re public, people start reading the receipts, such as partnerships that were really one-off pilots or R&D spending that never became a product. Wins extend your runway. Big claims with no wins shorten it, and eventually you’re in a crisis.
Right now, that room is smaller than usual. Reporters are tired of AI hype, and the public is uneasy as well. Even as of mid-2023, Pew Research found that 52% of Americans were more concerned than excited about AI, while only 10% felt genuinely excited. As Fast Company reported during the spring AI backlash, public trust is wavering while regulatory scrutiny grows. The SEC chair warned against “AI washing” in late 2023, and the agency brought its first two AI-washing cases forward in 2024. Since then, a steady stream of related cases has followed.
When the gap gets too wide, external forces close it for you. WeWork pitched a community movement while making its money renting office space; in 2018, Fast Company asked whether WeWork could be worth $40 billion. It peaked at $47 billion in 2019 and filed for bankruptcy in 2023. More recently, Apple agreed to a $250 million settlement over how it marketed delayed features. The more attention you have, the faster someone else closes the gap for you.
REPOSITIONING OR COSTUME?
Repositioning is grounded in proof. Without that proof, it is just a costume. Before you claim a new category, ask your team a few questions:
- Who on our leadership team or advisory board has built this kind of business before?
- Which customers use the product today, and will they say so on the record?
- What would a skeptical reporter find after 10 minutes of searching your company or execs in Google or an LLM?
- Could we let someone see how the product works without a human guiding the demo behind the scenes?
- If we took the word “AI” out of our pitch deck, would there still be a business worth writing about?
- What is our next proof point, and when does it land?
The answers make up your paper trail: people who validate you, customer data that backs you up, and a clear account of the problem you’re solving. A costume has none of that.
The gap can also run the other way, with the technology ahead of the story. Then the job is helping the narrative catch up.
DO THE WORK FIRST
Bill Walsh, who won three Super Bowls as the coach of the San Francisco 49ers, wrote a book called The Score Takes Care of Itself. He argues that if you focus maniacally on preparation, details, and quality, the desired result will follow. The same goes for your story. If you do the work, category leadership and a higher valuation usually come next.
If you’re a CEO or a communications lead, check your own paper trail before a reporter or a regulator does it for you. Ask your team for proof and verify it yourself. Storytelling is my business, so I’m telling you the story only goes so far. Mind the gap.
Tyler Perry is co-CEO of Mission North.
