“We don’t just need to save lives, but livelihoods from devastation”, says Padmaja Ruparel, President of Indian Angel Network, speaking about survival strategies for startups amidst the pandemic. To address similar questions and other related entrepreneurial queries, GUSEC organised a session called ‘Survival & Fundraising Strategies: An Investor’s Perspective’. The session consisted of Piyalee Chattopadhyay, Executive Director of TiE Ahmedabad, GUSEC startups, and was moderated by Dheeraj Bhojwani, CEO, AIC-GUSEC. In this blog, we list down the essentials of the session.
Stressing the need for commitment to their endeavors, Padmaja says, “Startups need to understand that it’s going to be a really long haul,” and encourages startups to “get ready for a longer marathon”. She says that fundraising is important, but mentorship even more so. She also talks about the importance of all stakeholders of the startup ecosystem to come together during the pandemic to aid each other. She says that the COVID crisis was a threat that nobody saw coming, and investors need to understand that if a startup is growing during the pandemic, it’s a bonus, but even if it stays afloat, it is an achievement. When asked about survival strategies that a startup could follow, she has the following suggestions:
- ‘Cash is King’: Postpone any expenses that are not imperative, urgent or life-threatening.
- Focus on income, figure out how and get in as much cash you can in the company. Henceforth, figure out how to accelerate that cash retention.
- Be cruel to be kind: If one needs to implement reduced salaries, reduced team members, or deferred salaries, go ahead. Basically, do anything to stay afloat.
- Rethink your Fundamentals: The pandemic is forcing us to re-evaluate our basics and necessities and getting rid of the excess. Do the same for your startup as well
- Leverage your competencies and business models.
- Pivot or Perish: Look at the pandemic as an opportunity to pivot to newer ways of business. Adapt to things that you weren’t previously doing. Pivoting your business is important, but even more so, is ‘pivot of the mind’. This needs to be done by both, startups and investors.
- Focus on unit economics, customer acquisition, the changed needs of the customers, new markets arisen out of these new needs, keep your team together, keep your mind open, and try to explore all avenues of innovation
- Not every startup has access and connections to mentors; all startups who do, should take those advises and imbibe them in their operations.
- The world is going through a change – there is a paradigm shift in the minds of the people. There are new problems, new needs to address, which will require new solutions and new products, and give rise to new ways of conducting business.
- COVID may have had negative effects on business, but on the other hand, is also responsible for a lot of price cuts on office space, talent, marketing, technology, etc. Startups should ensure leveraging the same to their benefit.
HAVE QUESTIONS LIKE THESE?
- Is this a good time for a student entrepreneur to get into entrepreneurship or should they wait for a better time to invest in their ideas?
- From an investor’s perspective, what are the ideal credentials of a founding team? Is there an ideal size they look for? Does having a co-founder make a difference over a solo entrepreneur for an investor?
- What is an ESOP and why is it significant?
- What terms do investors value a startup in?
- Are investors looking at specific sectors to invest in post-COVID?
For answers to these questions and similar queries, watch the entire session here.
GUSEC now has an entire playlist of topics related to startups resources, for your perusal. You can access the same here.