Business tips for navigating this uncertain time from the Company Ventures team
Company. Mar 30, 2020
We’re sharing strategies and insights from the Company Ventures team and our current Grand Central Tech Startup-in-Residence founders to help you and your business navigate this uncertain time. From tips for fundraising to maintaining company culture, we hope this serves as a useful resource.
Where to focus
Make sure that everyone on your team is healthy and set up to continue to do their jobs.
- Put protocols and processes in place that will help your team operate and succeed (and know that these protocols and processes will change). Don’t be afraid to try things out and get in the habit of overcommunication, now that we aren’t face-to-face.
- Reestablish priorities. What do you have to get done? What do you want to get done? Amp up your strategic planning.
- If your product provides someone with a needed service to drive their business forward, you can be very helpful during these times. Consider the ways that you can empower people to be less concerned about their own jobs.
- Never let a crisis go to waste. Determine what your team can accomplish over the next several months to come out of this as a leaner, meaner, more efficient business.
- Re-evaluate your assumptions on the ideal customer. David Campbell at Tropic (GCT 2020) shut down his ideal customer profile and adopted a different one. He looked at industries that are projected to stay stable and do well, like communications apps, and built a hit list of the types of companies that will see more activity during this period.
- During this wait-and-see period, financing will be harder to come by. Expect non-institutional money to dry up. That said, VC’s will continue to deploy capital. Of course, there will always be exceptions. If a strategic angel investor is showing interest, don’t take your foot off the gas – just be cognizant that relying on angel investors or family office money in this market should not be your strategy.
- Now, more than ever, it is essential to do your research before approaching potentially interested firms or partners. While they will still be deploying capital, the bar for who they invest in will be set higher as market-fomo lessens in operating environments such as these. Great companies will continue to get funded.
- Revenue allows you to have resources. Consider charging, or charging more, for your product.
- If you do not have twelve months of runway, make that your priority. It is your responsibility to your customers, investors, and employees to make tough decisions for the survival of your business. Consider how you can preserve cash by cutting costs and raising money. We are advising our portfolio and program companies to consider what the next potential six months look like as they operate a team remotely.
- Approach existing investors. Consider offering discounts for your next round. Be prepared to spend equity to keep your company alive. You will have more leverage during investor conversations today than you will in three months.
- Override optimistic instincts about what the future holds. Don’t kick the can. Now is the time to have a contingency plan and to make deeper cuts (10%-20% is normal operating here). This could very well mean a reduction in staff. Don’t shy away from tough decisions. Becoming a leaner enterprise to ensure survival is not something that founders will regret.
- Predict the future and play out different scenarios within your model. This can be both informative and comforting.
- If you’re looking to flesh out your financial model or plan for different scenarios, check out these templates from our community to help you get started.
- In-depth financial modeling template from Richie Bonilla, Founder, Clarity.
- Scenario planning tool for a 6m, 12m, 18m slow down from Arthur Woods, Founder, Mathison.
Keep up the culture
- This can feel like a weird time to bring someone on board, but whether you’re welcoming a new employee or just keeping your team in sync, there are great ways to make remote camaraderie real.
- Make efforts to virtualize communication. That means holding a virtual all hands as well as going out of your way to engineer moments like having coffee and checking-in. Even if it’s just for a minute, face time can go a long way toward keeping your team energized and connected.
- If someone is new to your team, consider pairing them with another team member who can answer any and all of their questions.
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