Early in the life cycle, when a business is young, unformed, and has little history, its value is driven primarily by narrative, with wide differences across investors and over time. As a company ages and develops a history, the numbers start to play a bigger role in value, and the differences across investors and over time start to narrow. Using the story/number framework, I look at how the process changes over the life cycle of a firm, from start-up to liquidation.
