# The Golden Circle Applied to a Real Company Source: https://unrivals.com/blog/golden-circle-why/ Site: UNRIVALS · Language: en · Updated: 2026-08-29 > The Golden Circle says you start with WHY rather than with what you sell. The model is sound, but almost every example that explains it is a billion-dollar company. Here is what it looks like on a five-million-euro one. --- The Golden Circle is a communication model formulated by Simon Sinek, which holds that organisations that persuade start from WHY, the reason they exist, then move to HOW, the way they work, and only then to WHAT, the product itself. Most companies communicate in reverse, from product to reason, which is why they all sound the same. **TL;DR.** A WHY is not a pleasant sentence about passion. It is the answer to "what dysfunction in this market annoys you enough to build a company around it". A usable WHY passes the competitor test: if a competitor can say it word for word, it is not your WHY, it is a description of the category. The model works, but nearly all the material explaining it uses billion-dollar examples, which makes it look inapplicable to a company of five million euros. ## What is the Golden Circle, concretely? The model has three concentric circles. At the centre sits WHY, the reason the company exists beyond making a profit. The second circle is HOW, the processes and principles through which you act on that reason. The outer circle is WHAT, the thing you actually sell. [Sinek presented it in 2009](https://www.ted.com/talks/simon_sinek_how_great_leaders_inspire_action) at a local TEDx event in Puget Sound, in front of roughly 50 people. The recording has since gathered more than 60 million views on ted.com and became one of the most watched talks in the platform's history. That popularity is, paradoxically, the model's main problem: it has been repeated so often that it turned into a presentation cliché, and clichés get quoted rather than applied. The order matters for a concrete reason. A buyer's brain decides on the basis of what something means to them, then looks for rational arguments to justify the decision. If you open with specifications, you are handing over justification material for a decision they have not yet made. ## Why does almost every company's WHY sound the same? Because it is written to please rather than to exclude. A WHY that offends nobody, and in which everyone in the category recognises themselves, communicates nothing. The test is the same one we apply to any message: could a direct competitor say this sentence, word for word, without lying? "We believe in quality and in long-term relationships with our clients" passes for practically every company. So it is not a WHY, it is a courtesy formula. | Statement | Competitor test | What it actually is | |---|---|---| | "We believe in quality" | Passes for everyone | Hygiene, not differentiation | | "We put the client first" | Passes for everyone | Courtesy formula | | "We want to be leaders in our field" | Passes for everyone | Internal ambition, irrelevant to the buyer | | "It bothers us that good companies lose to those that market themselves better" | Fails for most | Usable WHY | | "We build so that a manufacturer stops depending on one distributor" | Fails for most | Usable WHY | A usable WHY has three properties. It names a concrete injustice or dysfunction in the market. It excludes somebody, meaning there are companies that would not recognise themselves in it. And it survives the question "why does that matter", asked three times in a row. ## What does the Golden Circle look like on a five-million-euro company? The canonical examples are Apple, Tesla and Nike, and their problem is that they illustrate the model on companies that already have the result. A founder running a five-million-euro business looks at them and concludes, reasonably, that the conversation is not about him. Take a manufacturer of industrial equipment, five million in revenue, selling through tenders and two distributors. Its usual communication starts at WHAT: the product range, the years of experience, the certifications. Applied to that company, the model reads: **WHY.** "It bothers us that a company doing honest work loses tenders to one that delivers badly, purely because it wrote better documentation." Specific, exclusionary, and everyone in the category knows exactly what it refers to. **HOW.** By entering the project before the specification is written and helping the buyer define requirements around performance rather than around price. **WHAT.** The equipment itself, which only now becomes the consequence of the other two rather than the starting point. The practical difference is not in the brochure. It is that, once phrased this way, the WHY dictates who gets called first, what questions are asked in the first conversation, and which tenders the company stops entering. A WHY that changes no operational decision stays decoration. ## Does a WHY actually produce financial results? Honesty is required here, because the question runs into an evidence problem. The figures circulating on this topic are spectacular and poorly documented. "Purpose-driven companies grow three times faster" appears in [Deloitte's marketing material](https://www2.deloitte.com/il/he/misc/in/global-marketing-trends/2020/purpose-driven-companies.html) and is picked up from there by hundreds of articles that cite each other until the origin disappears. I could not find a primary study with published methodology behind most of these percentages, and a figure that cannot be traced to its source is not evidence. What can be documented is the mechanism rather than the percentage. Research by [Bain & Company with Google](https://www.bain.com/insights/what-b2bs-need-to-know-about-their-buyers-hbr/), published in 2022 across more than 1,200 B2B buyers, shows that 80% to 90% of them already hold a shortlist of vendors before formal evaluation starts, and that 90% buy from that list. A clear WHY works precisely in the period before the list forms, when the buyer is searching for nothing and merely retaining. Professor John Dawes of the Ehrenberg-Bass Institute showed, for [LinkedIn's B2B Institute](https://business.linkedin.com/marketing-solutions/b2b-institute/how-b2b-brands-grow), that roughly 95% of the B2B buyers in a category are out of market at any given time. The message that reaches those 95% cannot be a specification sheet, because they are comparing nothing right now. It can only be a memorable reason, which is the functional definition of a WHY. Put differently, the WHY is not a theory about inspiration. It is the only kind of message that survives in the memory of someone who is not buying today. How it converts into [cognitive ownership](/blog/cognitive-ownership/) explains why companies that formulate it early pay less for acquisition later, and how it maps onto channels belongs to the [marketing architecture](/blog/marketing-architecture/). When the WHY is missing or generic, the result shows up immediately as [an unclear brand](/blog/unclear-brand/). ## Frequently asked questions **Who should formulate the company's WHY?** The founder, or the team that made the founding decisions, because a WHY is discovered rather than invented in a workshop. An external partner's role is to ask the questions and cut the phrasings that pass the competitor test, not to write the sentence. **How long should a WHY be?** One sentence. If it needs a paragraph, the thinking is not finished. The practical test: someone in sales can repeat it from memory, on a call, without looking at a page. **Does the Golden Circle apply in B2B, or only to consumer brands?** It applies more strongly in B2B, for a mechanical reason: B2B decisions are made by committees, and a committee needs a shared reason that survives internal debate. Specifications get contested, reasons get relayed. **What is the difference between a WHY and a mission statement?** A mission usually describes what the company does, in the present tense, in language suited to a website. A WHY describes why it started, and a good one bothers somebody. If the two sound alike, you probably have two missions and no WHY. **How long before a well-formulated WHY shows an effect?** The internal effect is immediate, because it changes which deals you turn down. The market effect appears over six to twelve months of consistent repetition, provided it shows up the same way at every point of contact. Repeated inconsistently, it does not accumulate. --- If you want to see how your company's WHY sounds from the outside, including what a competitor could say in your place, [ask for a teardown](/#contact).