How to survive during the disease outbreak and financial crush? That’s the question number 1. Question number 2, which sounds more ambitious, is, “How to win in this unstable situation?” Angel investors and VCs around the world are sharing their predictions on the most reasonable startup behavior at that time. Emerline has chosen popular investors’ recommendations for entrepreneurs to stay afloat.
Question financial planning
Money first, and in tough times, a safety net plays center stage. Thorough review of your costs is needed. Mind the following aspects during the assessment:
- Reconsider your revenue growth plans in accordance with the current economic situation.
- Calculate your cash runway. As the business environment is unstable, the primary objective will be the runway extension.
As soon as you have the numbers, come closer to cost adjustments. Do not bank on the potential investments, focus on the cutting down operational expenses, and prepare a contingency plan.
Meet the era of wide open communication
It is time when there is never too much communication, as the utmost transparency of the processes, visibility of operations, and dialogues via all possible channels (email, messengers, video chats, social media, or others) are becoming your associates in dealing with the issues aroused.
Trustworthy conversations with the investors will help to be aware of the shifts in financing and define the alterations in your business strategy. Do not make your staff guess what’s happening — loyalty of the team is crucial now. So, be ready for open discussions and sharing the vision on equal terms.
Feedback from customers and their newborn expectations from a product or service could be a helping hand in enhancing your business model in a fluctuating marketplace.
Besides, do not underestimate the value of existing business relationships — the more you communicate with your clients, strengthen your partnership, and foster collaboration by delivering personalized offers or services, the more benefits you will reap from those who are already committed to long-term cooperation.
Go online and drive digital transformation
Online formats and digitalization have never been so popular before — a compulsory work-from-home mode dictates changes in operational and strategic approaches.
If your business has enough experience in setting up digital strategy, why not to share it during online consultations? Generally, there is no limit in the number of topics for online discussion — you are welcome to inform the target audience how to run effective marketing campaigns, choose right technologies for building an e-commerce solution, or simply offer some tips on how to organize remote working right.
Any ‘dummy course’ when you act as an expert increases your visibility, which will certainly turn into an advantage. You will cover the urgent needs of business players who have a lack of expertise in a particular field, promote the most preferable communication channels of the time, and gain more credibility.
Set a course for adaptation
The Albert Einstein’s quote saying, “The measure of intelligence is the ability to change”, gives a clue on how to perform during the crisis.
Some business areas thrive without efforts today — a quarantine mode favors the gaming industry and their products that are particularly on demand among those who are staying at home and seek the way to amuse themselves.
Delivery services and corporate messengers are on the rise as well — these are the areas that simplify living and working conditions during limited social interaction. Any healthcare-related solutions cause a particular interest and are treated as a chance to stabilize the situation.
On the other hand, tourism, for instance, has definitely seen the better days. The most rational way to keep the lights on is to contribute to the affected parties. Offer free services and support, from transfer for physicians to food delivery, and reorient yourself to urgent global needs. It is high time to give a helping hand, reconsidering your company’s strategic objectives.
Investors are becoming more selective — be ready to meet this inevitable challenge
It may sound too evident, but those who will do their best to prove they are unrivalled in their niche will win. It’s a push for startups to try harder for raising the next round.
Let's imagine you are an AI-based company — robotics and drones are drawing the attention in the time of social distancing and self-isolating. First thing is to react to what is trending right now, like a robot-as-a-service business model (robots for sanitizing public places, monitoring patients’ temperatures, delivering food, etc.) Then, your goal is to deliver the solution that is bringing the highest return on investment for the potential customers. Explore the latest products available, add your unique vision, and carefully select tech for the implementation.
If you accept crisis as the task setting and react accordingly, focusing on the solutions, not the problems, this will at least protect you from destructive processing activities. Also, adaptation is a key — reconsidering your goals and priorities can stabilize the things.