A survival guide for tech startups in the age of coronavirus
Posted On March 23, 2020
Coronavirus pandemic has claimed thousands of lives and caused trillions of dollars in economic damages. The question is, how should tech startups weather the crisis especially during a period of uncertainty? Below are suggestions to tech startups from Warren Leow.
Loew said: “If you are a startup with limited runway of less than 6 months, is bleeding cash and have not found a stable business model, are are my suggestions:”
- Reduce cash burn by 50%. You cannot rely on VCs to fund your business survival
- Reduce marketing by 80% especially on Google and Facebook
- Cut down on personal expenses
- Defer all large CAPEX (capital expenditure) for this year
- Renegotiate with vendors
- Reduce salaries to prolong payroll and provide job security
- Keep track of government incentives to ensure business survival
- Find new customer segments as your traditional segment is likely to be negatively affected
- Work twice as hard and be prepared for half the results
Finally, Loew suggested you trim all the fat. If you can’t, then make hard decisions of knowing when to cut or shut down.
Hats off to Mike Mann (@mikemanndotcom) who first shared this on Twitter.
from Warren Leow not me……….
— Mike Mann (@mikemanndotcom) March 23, 2020