Power Talk │ February 2021│Ready to Startup

Companies soon realised, during the hardest
months of April – June 2020, that ‘Cash is King’. It
became imperative that companies right shifted
their expenses and left shifted their collections /
advances. Hence, the focus on capital efficiency,
gross margins, are all key investor trends.
Companies with strong revenue projections AND an
eye on profitability or, at least an intent to be
profitable, did attract stronger interest.
The pandemic did not halt
the investing business
It just slowed it down. As young companies took a
deep breath, gathered their wits and re architected
their models, investors sat down to research and
keenly follow the emerging trends. It became
apparent that customers had not gone away but
their behaviour had changed, customer acquisition
was still required, but now companies would need
to do it from their laptops, and delivery will need to
have a mix of offline and online!
Investor sentiment did not
dissipate during the
pandemic
It paused and then picked up and how! The Edutech
sector is evidence of this! And investors continued
to invest though the number of investments
reduced. The changed customer behaviour focused
on the “basics” food, logistics, education,
healthcare, clean energy all enabled by technology
– garnered investments. Sectors which have seen
innovation and going forward we will see more of
are manufacturing, textile, agriculture. Innovation is
already starting to happen and new business
models enabled by technology are starting to
emerge.
Strong Founding teams is not the only key. The
pandemic did reflect that only those with resilience,
imagination and an instinctive DNA could survive
the body blow of 2020. It’s even more critical now
that founders not only building quickly, but are also
able to leverage upon the new opportunities by
taking quick decisions. It is not enough to have
focus on current customers or look at organic
growth, but to be alert for new customer bases and
ready to adapt. For instance, with social distancing,
digitisation has become mainstay. And people from
rural markets are now compelled to go online.
These are completely new virgin markets! They have
to get on the online highway but need products /
tools to do so. And companies which can cater to
these customers as well, will surely witness an
accelerated growth
co-create
Imagine
be effective
innovate
adapt
History has shown us that in the worst of times,
some of the best companies have emerged :
General Motors, General Electric, Disney, IBM, HP,
Traders Joe, Microsoft, Uber, Instagram, Whatsapp
and many others. When we look back, the
Pandemic and global recession of 2020 will also
mark the year of some great and successful
companies that left a massive impact on the
landscape of how businesses are run in future.
Clearly, innovation will thrive, start-ups will
burgeon, investors will invest and soon valuable
companies and investor returns will take shape.
Power Talk l Ready to StartUp