Today we open a new section of BlueOcean Magazine. It will host articles focused on startup advice, analysis or that simply explain some entrepreneur-related expressions. We have called it BOld startup academia and it is part of our collaboration with Blue Ocean leading drivers. For the first article, we thought it would be useful to start with some startup advice in times of crisis.
Most of us are locked at home with the uncertainty of what is going to happen after this crisis is over. In the mean time, many startups are still working and maintaining the activity, if possible, is a must. However, there are some other tips that might be useful to help your company:
Economy
- It never hurts to take care of your cash, but currently, it should be your top priority.
- In the same vein: stretch your runway. If you have a 18 months runway, try to stretch it to 24 months, so you can focus on your business without worrying too much about money. You can do this by Immediately cut all non-essential costs and freeze new hiring.
- Consider your forward budget with a dose of ultra realism, and make sure you will survive for at least 12 months even in the worst-case scenario.
Management
- Focus on what matters to grow your company and get rid of any distractions. Remember the Pareto principle? Make sure you work in the key areas.
- Re-evaluate your customer churn assumptions and sales pipelines. Some of your customers will fight for their survival and will just have to cut costs massively and that might mean dropping you. You should always show your customers you care, but in thimes of crisis, try to make an extra effort, or you could try to focus on your best customers, the ones you cannot afford to lose. Remember to analyze these figures and find out where your company is at any given stage.
- If you and your employees have time, it never hurts to acquire new skills and/or training. It may come in handy after the crisis is over (or even during!).
- Adapt and plan. You know funds will be hard to come by, so assess the risks and adapt your strategy. Since the situation will probably won’t go as planned, adapt again.
Social
- Never forget to take care of your people. Good employees that feel valued will help your company stay afloat.
- Focus primarily on existing customers but you can try to attract new ones. To do that, explore innovative, perhaps even radical, ways to secure new customers and deliver value to them.
- You should do the same with your investors: let them know what your situation is, and what you are doing for the company.
- Be social. Go to LinkedIn and make new contacts, talk to the ones you already have, meet new people in a webinar… As with your employees, investors and customers: don’t forget the human and social factor that involves business.
During all these stages, try to be as realistic as possible. Your company won’t survive on hope (alone), but on analysis, planning and hard work.
Nowadays, most startups are seeing a short term negative effect in business. Your aim should be to reduce that as much as possible and to avoid the damage become long-term. We know this is a challenging time for many reasons, so stay safe first and foremost. BOld and BlueOcean Magazine hope this article is helpful for your startups.