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It was their family names that doomed the young lovers in Shakespeare’s Romeo and Juliet. Yet could the name you choose for your business create a company star-crossed with success?
As human beings, we evaluate information quickly and make judgements in a snap. In fact, Harvard research has pinpointed snap judgements can be made in as little as three to four seconds of meeting someone. For reference, this is barely enough time to say hello, but the human brain has already made a friend-or-foe decision.
As evidence of our evolutionary past, these snap judgements make sense. However, they might spell disaster for individuals and businesses with the wrong names. Can a name really determine whether you succeed or fail? Let’s take a look at some evidence:
Improved Odds of Success
Your customers or investors fluency with the name you choose to give your business can make a huge difference when it comes to the ultimate success of your overall venture. A study on behalf of the Society of Personal and Social Psychology, Inc. discovered stocks with easier to pronounce names outperformed those with names more difficult to pronounce.
Looking at roughly 700 stocks between 1990 and 2004, the researchers discovered on the first day of trading, those with the simplest names earned 11 percent more than the stocks with the most difficult names. The difference increased to 33 percent when taken over the course of a whole year.
Takeaway: Stay on topic. Companies like Amazon and Apple (and we anticipate Pluto.TV) can get away with names which have nothing to do with the actual company and product simply because they’re easy to remember. However, you might want to create a tie between the name of your company and the reason it exists, just need to evaluate your market.
Why is Simpler Better?
According to researchers from the Department of Psychology at the University of Michigan, low processing fluency leaves the impression than a stimulus is unfamiliar and therefore dangerous. Put another way, we often fear the unfamiliar and are uncomfortable with what we don’t understand.
An example in the business world is the divergent paths of two personal finance focused startups. Both Mint and Wesabe were tools to help individuals track their personal finances. Only one is still in the game now. Can you guess which one? An account from a higher up at Mint pinpointed the name as one of several reasons Mint was ultimately more successful.
When creating a company, you need to reduce the barriers keeping customers and investors from buying into your vision. If your company name is hard to pronounce, difficult to spell, or makes little sense in relation to your product, you’ve unknowingly created a barrier to your own success.
Keeping things short and simple holds just as true in the online marketplace as it does when looking at a stock portfolio. In fact, according to a report from 2011, the most popular length for a domain name was only eight characters. Consumers don’t want to remember an endless string of characters to find your business on the web. It’s not just because humans are lazy (although we often are), but also because our short-term memory is limited. It’s the reason why phone numbers only run seven digits.
Takeaway: Keep it short and simple. It might seem like a good idea to have a company name made up entire of emojis when you’re in the weeds creating a company. It’s not. Keep your company name short and simple. Crowdsource your potential name and see what friends, family, and associates think. If they can’t remember the potential name a few days after your conversation, it’s the wrong name.
What About When it Comes to People? 
Unfortunately, this familiarity rule holds just as well for people as it does for company names. This is bad news for those with parents who have a creative naming streak, minorities, and women. Names can impact performance in school for children, as well as their future career opportunities as adults. And while having the same name as everyone else can be a drag during roll call in school, it can make you more likable (and employable) later on in life. (Thanks a lot mom and dad for naming me Ilya!)
Names that sound like they belong to a caucasian are more likely to be hired than names associated with minorities. In fact, researchers found a “white-sounding name” can be worth a staggering eight years of work experience. For women, having a sexually-ambiguous name can be a blessing in disguise. Research discovered women with masculine names had more success in their law careers than their more feminine-named counterparts.
What do you think? Share in the comments!
About Ilya Pozin:
Serial entrepreneur, writer and investor. Founder of Pluto.TVOpen Me, and Ciplex. Writer for Forbes and Inc. Husband 1x, father 2x, entrepreneur 3x. Follow Ilya below to stay up-to-date.

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