There are sectors that have benefited immensely on account of Covid-19-induced work-from-home compulsion. Some, like healthcare providers, pharmaceuticals and medical equipment start-ups have seen a direct bump in their revenues.
By Kamini Vidisha
The coronavirus lockdown has put recessionary pressures on the economy, leading to revenue and job losses. This is especially true of SMEs, some of which are on the verge of shutting down. While this is a common refrain across many start-ups, I would like to share a more positive narrative and build in a message around opportunities that every crisis brings.
There are sectors that have benefited immensely on account of Covid-19-induced work-from-home compulsion. Some, like healthcare providers, pharmaceuticals and medical equipment start-ups have seen a direct bump in their revenues. Messaging platforms, edtech companies, home-delivery platforms, digital communication tech-based start-ups have seen a surge in demand for their products and services.
Sectoral impact aside, the Covid-19-induced stress is also an opportunity to rationalise business expenses. Real estate costs, for example, can be very significant and can be reduced by as much as 20-30% during this time. I personally know of many businesses that have renegotiated their rental contracts and have locked in a much lower cost for the next 3-4 years.
A lot of start-ups are making use of soft-prices at this time, and are making investments in technology or infrastructure to shore up their capabilities. They would certainly be ready when the world normalises, poised to take on additional market share.
This is also the time when many start-ups have got much-needed respite from the operational, day-to-day hassle. This implies a time to reflect, remedy and resurrect. Many of them would pivot to a different model, but in the process emerge stronger and more focused on their objectives.
There is a huge pressure to let go of your employees. As a start-up founder myself, facing a mountain of expenses, while there are no corresponding revenues, I feel the need to let go of people as well. However, knowing that my people are my firm’s best assets, I have refrained from doing so. Instead, I have taken the opportunity to reach out to them, revalidate my confidence in them, and in some cases sought discretionary reduction in their salaries.
Not only have I grown closer to my team, but also as a firm we are better prepared to battle the new recessionary wave.This is not the last stand of hiumanity. Instead of wallowing in the gloom-and-doom scenario, brace yourself and make use of the opportunity that the coronavirus has provided. As a start-up, that is the only way to survive.
The author is co-founder, ACadru, a start-up