Why startups need to relook at business plans, review organisational structures

How will Covid-19 pandemic impact India’s startup industry ? In particular technology startup companies

Covid-19 has thrown up challenges which have been most deterrent to startups. There are challenges in terms of product relevance, pricing relevance customer retention, supply chain disruptions, employee management and more importantly the burnout and runway plans made will no longer be relevant. Particularly in the technology startup companies, it has made a lot of startups revisit the products they are working on and also deal with supply chain related issues.
Opex remaining same with revenues significantly lowered is a huge issue as well.

As an incubator, are you in the process of working out a strategy ?

We have been working on virtual incubation since inception of WE HUB. However it was about 15-18 per cent of our total work. With the ongoing global pandemic, we have shifted all our programs online including the selection of our second cohort of startups and the final pitching. This has been quite seamless from the teams perspective as well as the startups themselves.

What kind of support is needed by tech startups, from the Central and state governments, organisations like yours and other stakeholders?

The situation that the startups and mostly tech startups find themselves is something which is unchartered and a major unknown. So at WE HUB we are primarily working with startups 1-1 to understand their problems and their analysis of their own journeys would be post the global crisis.
Based on the feedback, the first thing we did as an enabler is to waive off the rentals for all the startups at WE HUB. Secondly, we have started engaging with each startup to work with them on strategies to sustain in the existing scenario including product line, understanding supply chains, possible funding issues, business plans pivots, customer acquisition and organisational management.

Which tech startup segments will be able to leverage these challenging times, to show growth and innovation ?

The tech segments in the mobility, last mile connectivity, hyperlocal delivery, hardware, healthcare, data analytics, Lean Manufacturing would be a few sectors which have been able to leverage the existing scenario and most importantly be of great assistance to amplify the efforts being put in by many to tackle the virus.

Is there any other significant factor you would like to highlight ?

These are unprecedented challenges which are being faced for the first time by a lot of sectors and industries, economies irrespective of scale. The big factors that the startups especially need to focus on to be relevant and survive the new normal economic climate we all will be facing. A few things that startups can look at in terms of operations, organisational structure and finances:

Virtual and online workforce:
Managing staffing deficits and organisational structures – Also means to make more work virtual and making metrics which will ensure staff productivity and retain the startup’s output.

Reviewing organisational structures:
Employee skills and cross engagements – There are definitely bound to be staffing shortages and how well is a startup prepared to take these staffing challenges by creating a pool of employees with varied skills to withstand any staffing shortages.

Relooking at the business plan:
What startups may have planned for burn rate and also the runway will all go for new look due to the way funding scenarios and also availability of capital is going to be when the lockdowns and economic tight hooks are loosened. This can be done by creating a focus on revenue rather than growth and ensuring liquidity in the face of any short term demand.