Will the real entrepreneurs please stand up?
These are hard, unsettling times, full of unknowns, brought to us courtesy of COVID19; But this is what all entrepreneurs sign up for, knowing that they will have to chase their vision through terrible adversity. This is when the real entrepreneurs with a focus on their mission will be revealed.
Every founder is thinking, "What should I be doing right now?" The times of boasting are gone. It's time for action, to lead from the front, to take charge with hard decisions for survival. It is time to deal with facts. Status quo is the enemy of opportunity. Do not make things worse through inaction. Startup idea, product, traction, subsequent funding is not a lottery ticket. It requires entrepreneurs with irrational perseverance to continue building business in tough times.
Next 100 days will separate the gritty from the vain.
Funding is Not a Panacea
Entrepreneurs should not take funding as the end goal or solution to all their business problems.
Entrepreneurs focused on doing, doing, doing, are busybodies; But the ones focused on results are successful in chaos. It is time to create the right metrics to track outcomes & not efforts. Be committed to results. Give direction to your efforts. It is a marathon run & not a dash to the finish line.
It's correction time. Work with investors to leverage the power of numbers by rationalizing & optimising expenses, and extending the runway to 2021. Go Marie Kondo on your expenses. Entrepreneurship is all about learning by experience, but it's even smarter to learn vicariously - from the experience of others. Engage very closely with mentors, investors who have navigated through the dot-com bust in 2000 or the financial recession in 2008. It is time to create value first and valuations later.
VCs are favoring startups with a clear path to profits & grounded valuations.
It is time to shift gears from planning for growth to planning for survival. Troubled times calls for entrepreneurs to become frugal so as to overcome this phase of ambiguity. In force majeure time, there are no rules, processes or standards; only one rule applies, "Preserve cash."
Cash is King, Preserve Cash
All Weather Businesses are En-Vogue
Leverage this predicament to rethink the business model and work to make yours an all-weather business. It's necessary to do a pivot, to take a different approach to making money. Be where your customer needs you to be. The business is at a crossroads, take calls on what is working and what is not. It is the perfect opportunity to stop and reassess your work, introspect, retrospect, and make the changes at the core of the business. This you will have to do as an entrepreneur.
Entrepreneurs afraid of rocking the boat can never get ahead.
Entrepreneurs look for solutions, not escape.
Entrepreneurs start thinking once cash runs out. Today's environment provides ample opportunity to become an even more effective and inspiring entrepreneur, and attract investor attention. Eliminate or reduce expenses that are not contributing to the immediate revenues. Discover ways to stay close and new ways to help users of your product and services tide over their problems.
The strength of engagement with users is a critical leading indicator for the investor.
Innovate to do more with less. Leverage the leanness and nimbleness of being a startup to go after new users while the incumbents are struggling to adapt. Involve your team, your customers, your suppliers’ in the business, make them and their insights part of all tough decisions. If founders can’t convince the stakeholders to work for the company for a deferred payment (suppliers) or advance payments (customers), then the startup has got a much bigger problem on hand.
A Crisis is not the time to be brave but to be paranoid, so share to make aware.
Even in the darkest of times, winning entrepreneurs have "attitude"
- Get into tough conversations, be expressive & have the ability to say "No"
- An attitude of zero tolerance, no overlooking of facts, problems & errors.
- Never risk reputation, no innovation in legal and finance.
- Accessible to team, customer & investors, continuous communications.
- Be real. Act & think like a human. Do not take capacity as infinite.
- Respect money, build close investor relations.
- Take one step at a time, build a business with internal accruals & customer funding. Investors will follow.
- Scale customers first, products later.
- Priority should be on customer communication, education & engagement.
Startups are not for the faint of heart.
What are we doing at 100X.VC Startup Portfolio?
We are getting our portfolio to ensure their runway is extended to 2021.
We are working to each portfolio team to ensure right people contribute and continue.
We are helping each company chalk plan, prepare for the opportunity when normalcy returns.
We are working with each company on their go to market, business model and success.
We help founders do the budgeting by pretending the money in the bank doesn't exist.
We prevent blind optimism from burning all resources for growth.
We work with the interested VCs with open conversation to close the rounds with portfolios.
We are working on investor relationship to build accountability and reputation of each startup.
We help them stay married to their big dream, vision and their important contribution.
Luck is when preparation meets opportunity