Winston Churchill once said “If you’re going through hell, keep going”. This particular quote has a profound meaning today, when the Indian economy is battling COVID-19 and the maximum heat is being felt by Indian startups. The recessions of 1982, 2000 and 2008 are examples of how startup funding had dried out. Even well-funded and established companies are facing difficulties in staying afloat. The challenge for Indian startups now is down to survival.
COVID-19 has not only damaged the health of people but has managed to put a lasting dent in the world economy. Here we talk about a few tips which will allow you as an entrepreneur to rise up to the challenge and not lose hope.
Cash
Most startups die not because they lack idea or innovation but because they run out of cash. It is very important that startups have a cash reserve of about one year, in order to survive this slowdown period. When the COVID-19 crisis gets resolved, it will be a while before things improve economically.
Forget the funding
Investors won’t be investing in these scenarios. This pullback will last even after the COVID-19 crisis is in control. A bid to acquire small bunch of funding can be made but only if you are very confident of taking the boat through the storm. M&A will dry up; if you were in discussions last month, expect that nothing will happen until this crisis ends. It always bodes well with investors if you share regular and accurate information regarding the health of your company.
Revenues are likely to be cut
If you have expectations with projects that are still in the pipeline, then you are in for disappointment. Every company, however big or small, will be going into survival mode, as a result multiple projects will be stalled. This would mean that the company’s revenues will be curtailed for quite some time. As an entrepreneur, will have to gauge and speculate correctly as to which sector of your business will generate enough revenue to ensure the company’s survival.
Grabbing opportunities
Make good use of any opportunities that come your way. The COVID-19 crisis has even pushed many businesses in different sectors to make masks and deliver groceries, like Zomato and Swiggy. Grab whatever opportunity that you can to extract a bit of revenue for the company.
Downsizing
It’s a harsh reality but many Indian startups are cutting down to bare minimum requirement to endure the current crisis. Salaries have been slashed, expenditure on marketing has been put on hold until customers are back to buying products are helpful in saving on revenues in the long run.
As with most things in life, this too shall pass. All you have to do is not lose hope and implement as many of these tips as you can to get through before business picks up again.
