These days, we are being overwhelmed by one single topic in all facets of our lives: Coronavirus (or Covid-19). The first and last time I will use these terms, I promise.
Today, I would like to write about the need for #reinvention and #creativity in these difficult times. To express this sentiment in different words – according to Luciano Delgado, a CEO from one of our portfolio companies – “Every bloody crisis brings huge opportunities, man!”
There are numerous strategies that can be used by both start-ups and established companies facing an economic downturn. These days it is quite easy to find ideas and recommendations on how to strengthen the balance sheet – all of which are quite similar and can be labeled as ‘muddle-through strategies’:
- ‘Cash is King’ – prolong your runway as far as possible
- Reduce OPEX as much as possible and delay new projects & expansion plans (CAPEX) as far as possible
- Stay positive and remain cheerful; the only way is up!
= Remain in the bunker until the storm is over!
Well, that is certainly an option. However, it is important to understand that 98% of today’s companies are doing precisely this – becoming paralyzed. Maybe it is the right time to think about how to benefit from this crisis. If so, how can this be accomplished? Over the course of the next week, three questions are worth exploring in-depth (do not fret, we have more ideas for the weeks to come!):
- Is my business model (once we are back to normal) still competitive?
If yes: Congratulations! We hope you did not make this decision through biased information.
If not: What could you do within the next 4–6 weeks to improve it, making it superior to that of your closest competitors?
- Where could I, following the concept of #first principle, make some controlled but conscious bets outside of my garden?
Lack of money: Cheap excuse! Try the barter system – offer services instead of money – people are certainly interested in getting things going! Be creative!
Lack of courage: Come on! This is the time – millions of people are stuck at home; they are certainly willing to participate in surveys and games!
- Do I have the right business partners (clients/investors) who can bail me out later down the road in case of dire necessity (as I know my business model is still good enough and worth saving?)
Attitude: You need people who welcome bold but controlled actions in such an environment.
In a nutshell, if you think you need to talk to ‘out-of-the-box thinkers’, drop us a line – we are happy to address your particular questions or issues.
Good luck out there!