Being a Rainmaker During COVID-19
Over the last few weeks, we have seen—and will continue to see—survival of the fittest. At Monk’s Hill Ventures, we’ve started bucketing companies into three categories.
The first is the ice bucket—any business that should essentially be put on ice during coronavirus. The chances of revenue for some businesses are almost zero this time compared with previous crises given worldwide downturns. Many of these businesses are related to travel or events.
The second category is pivot businesses, i.e. businesses where current customers are no longer buying and the business either needs to pivot to a new customer base or a new product altogether. Sometimes this could be just focusing more on a certain segment of existing prospects and customers (this is easier), sometimes it is creating a new channel (this is much harder during the crisis).
And finally, the third category is the winners—businesses that are thriving in this climate such as healthcare tech, collaborative tech, online grocery shopping and e-commerce.
One thing that is now becoming very clear, particularly for founders in bucket two and three, is that it is now time to strap on your boots and become a great rainmaker. The reason is this—any sales engine you build today may cease to be viable in the next 3-12 months. What is true today might not be true in 12 months. Refocus your efforts on being a great rainmaker and build your base, not just in customers, but also your talent, your product, marketing and sales, finance, legal and human resources.
A simple, but strategic question, these founders need to ask themselves is what happens when life returns to normal and all of this is over? How do you build good habits when the world comes back to normalcy?
For companies in bucket three who just addressed the onslaught of demand or MAU, here are a few considerations:
On runway: Runway is survival. That’s why bucket 1 companies should go on ice. We have seen too many startups (even in normal times) that have to shut down because they made the most rosey or hopeful assumptions. Now is not the time to plan on the most optimistic scenarios. When you don’t know what to expect, runway is the single most important determinant of survival. Cut your burn so you can survive longer.
On talent: Don’t be cheap. Find the best people for your team now, whether it is another rainmaker, a CFO or a CMO. This is also your opportunity to see who among your team is cool under fire, who you would want with you in the thick of battle. Keep these folks with you the rest of your career.
On the business model: Besides being a great rainmaker selling and fulfilling heavy demand from customers, ascertain what you can do to ensure the world continues to stay more in your favor post-pandemic. Are there any adjustments that need to be made in terms of cost structure, loyalty point system or membership model?
On customer retention: How do you continue to build and keep people using your product when things go back to normal? What additional products can you offer? How can you continue to be ‘addictive’ to your customers who will be going out more and may not be engaging as much on your collaborative tool or edtech platform? Do you need to create new digital content and marketing strategy?
While things are good now, take a step back, and think about what the new normal will be and your business’ place in this new reality. If anything, coronavirus has put an accelerant on digitalization and adoption of many new things for consumers including online shopping, remote working, online education and productivity tools.
The shift of consumer behavior in Southeast Asia will also enable the growth of other verticals including logistics and fintech. Ironically, we also see consumers returning to similar behavior we’ve seen in previous recessions or downturns, which is a shift towards more budget-friendly spending. Another outcome of all this is greater demand for more cost-efficient and better solutions from consumers, pushing founders to reiterate and refine business ideas, models and solutions.
Written by: Peng T Ong – Entrepreneur