The last three months have been worst than a nightmare for start-ups. It won’t be unfair to say that the entire industry is rattled. While the ultimate future of global economy is indistinct, almost everyone believes 2020 to be the onset of a major recession period.
How has Covid-10 Crisis impacted the Start-up ecosystem?
Most start-ups have been debarred of external support wherein foreign investors have put off agreements, domestic VCs (venture capitalists) have put on halt investments, both large and small funding deals have already been postponed, especially for companies in food, transportation, and grocery delivery. Above all, the consumption of non-essential products and services is on a standstill in the present Covid times. All these have made it difficult to start-ups to carry out their day-to-day operations.
Tips for Start-up to Bounce Back post Covid-19
We know that the situation is extremely challenging, but there are always ways to curtail losses.
1. Create a Real Strategy: While being hopeful is the need of the hour, hope is not the real survival strategy. Instead, you must focus on creating real plan with your investors and co-founders. Face the reality. Think of even worst time, which are likely to come in the coming months. Hence, formulate a plan to survive such times without external funding. To work on this strategy, you will need to make hard decisions. Sit together with your co-founders, and your employees and discuss the measures that you will take in the near future.
2. Keep Your Employees Together: At this time, your employees are your biggest strength. Hence, it’s your responsibility to keep them safe and comfortable, financially, physically and emotionally. Communicate with your team often at various levels. Indulge with them in their problems and extend support, even if it is just emotional.
3. Apply for Financing: It is quite obvious that fundraising will be hard during this time. As such, founders should work on alternative funding streams. Keep an eye on government-funded programs for small businesses. You can also include special low-interest or no-interest bank loans in your survival financing plan.
4. This shall too pass: Be Positive! Because no matter how disruptive this pandemic is, the war will be won. Hence, understanding that this shall too pass will work in your favour. Slowly but for sure. Utilise this time to engage with your team, customers and consumers. This will help you predict future needs in your areas and be future-ready.
Times are tough but the only way to emerge out of this is to stay strong and take our people with empathy and humility. Just remember, success was never guaranteed even when times were in our favour. So, hang in there, be future-ready, work on your plans, look for new opportunities and things will turn soon.