R3 Startup Series webinar recap: ‘Managing change in turbulent times: startup key resource navigation”
By R3’s Venture Development team
As a startup or an entrepreneur, your resources are often limited. How do you ensure you allocate your key resources to sustain your growth and trajectory, especially during challenging times? These are all fundamental questions in which we explored in our most recent Startup Series webinar.
Having help build and scale 30+ digital startups and now being positioned at the intersection between startup and corporate innovation, Mario was well positioned to share his views and expertise with the R3 ecosystem.
We have highlighted some of his key takeaways and points in this post webinar write up to further help our ecosystem sustain their business in the current crisis and maximize the chance of long-term success.
THE SHORT TAKE: Key actionable recommendations
Respond effectively to current challenges by focusing on 3 priorities:
- Crystallize your company purpose
- Take care of your key stakeholders (team, customers, investors)
- Build financial resilience (add revenue, cut costs and seek new funding)
Prepare your business for the opportunities ahead:
- Position for the new more digital economy (remote living, schooling and working)
- Set a company vision and empower your team with the tools to achieve it
- Leverage the growing ecosystem and use your network to drive positive change
THE LONG TAKE:
The current crisis is affecting all industries, from start-ups to multination enterprises.
What are some of the key impacts on current business conditions?
- Cash flow and liquidity hit across board–runway needs to extend to > 18months.
- Early stage companies are struggling to validate their market with limited customer access
- Later stage scale ups are paring back growth tractions and their expected valuations.
- Growing divergence between what customers need in the short term, and what the existing product offers.
- Immediate 2020 impact to all business areas
- Staff scattered remotely, leading to time and resource constraints
- Exploring new innovation opportunities only if they have an immediate impact on revenues and brand reputation
- Becoming more selective with fewer and more concentrated positions
- Focus on current portfolio companies and how to support them with capital and connections
- Rising interest in select verticals (healthcare, remote working solutions, e-commerce etc)
- Some shifting investment mandate to later stage early revenue companies.
What should founders prioritize now to navigate the crises?
- Take this opportunity to crystallize your company purpose:
Assess your big vision and clarify your key objectives. Lack of clarity means and ineffective team with unclear direction. This leads to unnecessary and costly distractions. Set the direction and empower your team with a cohesive environment and actionable steps and tools to be able to achieve those long-term goals.
- Take care of your key stakeholders:
Prioritize the efficiency and agility of your team first (customers may be unclear on what they need given the global uncertainty). Decide on the right team size, delegate key responsibilities and make sure they are empowered to make immediate decisions to adapt to the current changing environment.
Next your customers. Listen carefully to their evolving needs and make changes where you can to meet them. To help with this process ask yourself, “what are the current capabilities in my business that can really help my clients achieve their short-term goals?’” Engineer any new products or services only if you have the resources to successfully deliver on them.
Finally, your investors. As long as your team and customers are well taken care off, investors should be happy. Be transparent and consistent in your communication. Always be proactive to keep investors updated on your activities and don’t be afraid to ask for help!
- Build financial resilience:
Go back to basics and scrutinize your cash flow management. Assess all operational and non-operations costs to determine where savings can be made. At the same time be open to new potential revenue opportunities and funding sources beyond traditional VCs (government start-up grants, working capital loans, alternative financing etc.).
Finally, beyond the current challenges, prepare for new potential opportunities.
- Innovation around the “new normal” Low Touch Economy:
New companies and business models will emerge to adapt to a new world order where social distancing has changed how people work and live. Assess how your company is positioned as more people work from home, new lifestyle trends emerge, home schooling emerges, and companies rebuild greater resilience to future potential economic shocks.
- Better connected B2B start-ups and enterprises:
Leverage the ecosystem to stay at the epicenter of innovation. Enterprises emerging will need to accelerate their digital transformation efforts, to deliver on their future cost and revenue targets. Position your start-up to offer an easily accessible solution to help them deliver and execute that innovation.
Find relevant use cases that will drive meaningful and immediate business value to enterprises. Quantify this benefit in terms of new potential revenue opportunities, cost savings or enhanced customer experience.
Be ready to move from pilot to full production and deliver on the scale demanded by a large enterprise. Stress test your offering and make sure your platform has the capabilities to deliver.
- Think “ecosystem” – access new opportunities by using your network to drive positive change.
Examples include new products and initiatives that help the current health crises. Databases recently laid of talent has allowed for connections to new opportunities. Meanwhile corporate sponsorship programs to offer meaningful problems statements for innovative start-ups to address.
- Challenges presents opportunities
- Navigate around the 3 key priorities (company purpose, stakeholders, financial resilience)
- Leverage your ecosystem for positive change
Success is not final, failure is not fatal: it is the courage to continue that counts.
Interested in more?
- Download the full recording of this webinar here.
- Download R3 Startup Series webinar ‘How to Design a Winning and Sustainable Business Model Event’ here.
R3’s Venture Development program is the gateway into R3 and the Corda ecosystem for all pre-series A companies building on Corda. We help you to validate your business and product market fit faster. Learn more how we can help support your start-up and contact us here.