English
I have been developing a new methodology for online learning for the past 5 years. The creation of an educational platform on which this methodology can be fully implemented began eighteen months ago. Our team, like everyone else, had its own plans, strategy, and understanding of how the market is going to develop. Then the pandemic struck.
I have been developing a new methodology for online learning for the past 5 years. The creation of an educational platform on which this methodology can be fully implemented began eighteen months ago. Our team, like everyone else, had its own plans, strategy, and understanding of how the market is going to develop. Then the pandemic struck.
The inevitable economic crisis that erupted, causing highly volatile exchange rates, restrictions on travel around the world and other factors that came into play along with the pandemic discouraged us, and forced us to revise our plans. After all, we are developing a product for the international market. We have three offices: in Miami, Moscow and Dubai, a team of 164 professionals living in 19 countries. At the same time, we were certain that we were making a great product, that there is a demand for it. We kept at it despite the complexities of the pandemic, and did not let it slow us down. If anything, we stepped up development work. Now that the launch has taken place, I want to share the lessons that the team and I learned from this experience.
In recent months, you would have had to be totally disconnected if you did not get into discussion on the subject of how the pandemic and the crisis had a negative impact on business. Revenues are taking a big hit, businesses are forced to furlough employees to reduce payroll burdens, and amongst those that did not adapt in time, many even had to close down - some to wait and watch, and some, alas, forever. In the midst of all this, unnoticed in the din of negative predictions, there are stories about those who decided not to fight the circumstances, to accept them for what they are and be proactive. These players began to look for new opportunities, migrate to an online environment, improve service in response to new customer requests and set up startups, which perhaps look incongruous in the current situation in the world.
Although, come to think of it, why not? As they say, "when the going gets tough, the tough get going", and such daring and courage is often rewarded. This, of course, does not mean that having opened a business during quarantine, you are guaranteedy success. Under these circumstances, it is more important than ever to remember bear in mind that:
- During the crisis, peoples' incomes decline, and so does their purchasing power;
- High value purchases are postponed;
- People prefer to repair and continue to use old stuff rather than buy new;
- Widespread layoffs mean more manpower is available in the jobs market.
With this background, my first advice those who are opening a startup during pandemic: keep these facts in mind, analyze all business ideas, and straightaway discard those which look unprofitable. Focus on what's relevant today - pandemic is the best time to offer people some small, affordable services. However, if your clientele is able to make impulsive decisions given the volatile situation, it is better for you refrain from this so as to reduce the risk of unforeseen errors. There is no need, however, to be afraid of them, since crisis also throws up opportunities. For example, I see a decline in demand for commercial real estate, so this opens up the possibility to land a dream office at a bargain price.
Let us also keep in mind the more preferential taxation policies, which will help you get back on your feet a little faster. Simultaneously, because so many companies have laid off part of their workforce, a number of competent specialists have become available for hiring in the job market. It will also not be very difficult to attract sponsors, investors and capital partners. Large firms are also experiencing difficulties and as such are more open to cooperation, and investors, as we all know, are good strategists. They will be more willing to invest in the project if they see that in the current pandemic conditions, it will not just get blown away, but will emerge a winner.
Let's think of the pandemic as a special economic condition, and pursuing economic opportunity in these conditions is like undertaking the construction of an aqueduct in a difficult topographic terrain. In the plains, this task is fairly simple and predictable. However, in mountainous terrain full of gorges, it is far more difficult, and sometimes you may have to just let the force of water find its way. Likewise, in normal economic conditions, your strategy would be to launch your product in many parts of the world simultaneously. During the pandemic, many countries have begun to put in place various types of restrictions, making it impossible to implement the plan as originally envisaged. However, we did not delay the start of the project - we developed a new strategy whereby we went ahead with launching where the circumstances were more opportune. This allowed us to go ahead with the launch as per schedule in Spanish-speaking countries, in India andin Russia.
How not to close immediately after opening
No doubt, during crisis, the risk to any economic activity is higher, but you can ensure stability during the pandemic by watching out for precisely the same factors that play a key role in normal times.
Let's first address business strategy. Before you open up the business, prepare yourself well - it sounds very logical, but a lot of people overlook this old stratagem, simply praying that they will somehow "manage". Don't make this mistake: define in advance the target audience, channels of interaction and customer acquisition, and plans for short term as well as long term. Consider risks, identify opportunities and growth areas. By the way, today's consumer pays a great deal of attention to whether a brand cares about him or her, probably to the same degree as the safety and stability of a brand - do take this into account in your business strategy.
Secondly, a good strong team is the foundation on which any business is built. Employees must share values and vision of the company, and should work in a comfortable and productive atmosphere that will help them move collectively towards the company's goals.
The third factor is availability of working capital and funding, in simple terms a safety cushion, which ensures ability to shoulder certain minimum expenses, as well as additional costs that will be required for unplanned purchases, advertising or marketing services.
Let's now talk a little about which industries and niches are worth pursuing in the first place. My list of the top 5 sectors looks like this:
- Logisitics. An obvious win-win service that thrives in a crisis. While food delivery tops the chart, it is not the only sector that delivery logistics is required for. With the introduction of the lockdown regime, people have indeed started to use delivery services more often, so opening a local fast courier service and enlisting the support of restaurants and shops is an excellent idea. It will not be difficult to choose a target clientele - almost everyone is interested in home delivery.
- Education. The popularity of online learning has also increased: people have stopped spending a lot of time on travelling, revised their daily routines, and are ready to spend the available free time not only on family and leisure, but also on acquiring new skill sets such as English language, or programming courses, which previously used to be always put off as something for the future.
- Import substitution. Due to the fact that countries have closed their borders, and economic activities of some companies have come to a standstill, domestic manufacturing is in greater demand.
- Medicine. Everything related to medicine is now very relevant: starting from writing authoritative medical blogs, all the way to production of medicines, opening of pharmacies, clinics and hospital centers. These endeavors, however, may require large investments, and should that be a problem, you can use IT services to create an online application with useful healthcare information, providing consultation with a medical professional, and receiving basic specialist recommendations, all without visiting a clinic.
- Services for telecommuting. Not all companies were ready to switch to online working mode. This has created a demand for comprehensive proposals related to the creation of a common workspace comprising services and apps whereby in one location companies can set targets for the team, hold meetings, and monitor work efficiency.
An important lesson that we have learned is that external circumstances are never going to be the cause of your startup crashing or taking off. Yes, flexibility is required - but that is a necessity in every case scenario. Yes, it appears that in times of crisis the risks are higher, but in fact they are always high - coronavirus exemplifies this fact perfectly. Did many companies anticipate the situation to turn out the way it did? Not really, considering that businesses continued to function as normal in the days leading up to week the quarantine, since they were confident that the risk was minimal. The fact is that one must always be ready for black swans to occur at any time since by definition, they are unpredictable "unknown-unknowns.
