2020 was a year that most startups wouldn't forget in a hurry. From overhauling everyday operations and getting used to remote work to the dearth of new funding - the struggles were (and are) real. While the pandemic shows no signs of letting up, at least in 2021, it's safe to say that we have a better grasp on how to deal with the business challenges that it poses.
In this post, we’ll run you through the current struggles and provide 5 suggestions on how startups can emerge victorious in these challenging times.
What challenges can startups expect in 2021
If there is one thing COVID has taught entrepreneurs, it's the need to react quickly and flexibly to change. But the enormous scale of the crisis leaves even the most agile startups gasping for breath.
Apart from running behind essentials like business growth and profitability, here are the 5 biggest challenges that need to be tackled head-on by startups:
- Funding crunch: Due to the pandemic-induced rapid global economic slowdown and exodus of venture capital, you will be hard-pressed to raise funds anytime soon. So, if you are considering fundraising for expansion or innovation, you may end up disappointed.
- Lack of quality talent: In terms of an employee base, most startups just have a small founding team. This makes you more vulnerable to labor supply shocks during the pandemic. And losing a key employee, at this juncture, would mean disruption in your business.
- Plummeting employee productivity: With stay-at-home orders in place, many small businesses find their remote employees struggling to balance work and domestic life. Often overworked, employee energy levels plummet to new lows. That coupled with lags in communication and collaboration, worker productivity is no more what it used to be in the pre-COVID days.
- More security breaches: There are already so many things for startups to worry about. So, bolstering online security tends to be the last thing on their minds. But that can prove to be a very dangerous mindset, as hackers target SMBs who do not have the resources or bandwidth to take protective measures. Most cyber-attacks are so damning that about 60% of startups end up having to shut shop within 6 months of the breach.
- Difficulty in acquiring and retaining online customers: Let's face it - the average online customers today are fickle animals. If you don't keep them sufficiently engaged, they are likely to jump into the waiting arms of the competition. This is why it's important to focus efforts on finding more clients and invest in retaining the existing bunch.
5 ways in which startups can beat the COVID-blues!
Most startups are back in business and operating safely. But to thrive in the ‘new normal’ small businesses need to reimagine their ways of doing business.
While there is no tried-and-tested playbook to deal with problems the pandemic poses, here are some of the suggestions collated by our team of startups experts, to point your business in the right direction:
- Improve cash flow: Even the best laid out plans are now in flux. To give your business a fighting chance during these stressful times, you need to:
- Digitally pitch for funding: Yes, raising funds is a long, complex, and oftentimes frustrating experience. Sometimes you may even have to accept funding at lower valuations. But, don't lose hope. Instead, we recommend that you put your best foot forward and create dazzling digital pitch-decks and business plans. Keep it visually pleasing and stress on the ROI. Also, use an intuitive eSignature solution like Signeasy to sign and share the terms sheet and other funding documents. At the very least, let the physical documentation workflow not be the cause for you to miss out on a plum funding opportunity.
- Conserve cash: During a period of crisis, if you are unable to find the right investor, you should do the next best thing - conserve your existing resources. Choose "must-have" over "nice to have" expenses, be it for investing in storage space, employees, or admin tasks. But, don't scrimp on technology, instead seek out options that can deliver multifold ROI in the form of reduction in big expenses like monthly salaries, printing costs or transport costs, or identification and liquidation of obsolete inventory.
- Pivot the business model: In a difficult funding environment, it is important to recognize the limitations of your business idea and pivot your business model or future investment plans to stay afloat.
- Secure government contracts and grants: While such wins are difficult to come by if you end up securing a government-linked source of income it can be the thing that sustains your business on its road to recovery.
- Choose smart productivity-enhancing workplace technologies: From CRMs to collaboration software and eSignature solutions, there are so many powerful technologies that are purposefully built to fix your employee’s remote work woes. Here are some of the best tools to supporting employees in a hybrid or fully remote workplace:
- Also, automate as much of the mundane and admin tasks as possible. In this way, free up your employee’s time that can be better utilized for more strategic and creative jobs.
- Harness customer-experience solutions: To keep your customers tied to your brand, it's best to invest in the likes of loyalty programs, live or AI-powered chats for speedy issue resolution, digital feedback collection, tailored solutions powered by customer data. Such customer experience solutions, build engagement and reduce customer churn, thus guaranteeing a 2-7% return on sales.
Additionally, be sure to switch to an e-commerce model and enable eSignatures and digital money transactions on your portal for greater ease of doing business in these COVID-times.
- Upgrade your HR and recruitment plans: Obviously, you should aim to hire remotely, as much as possible, during the crisis period. And when you screen candidates, make sure to check for skills that make them compatible with remote work such as self-motivation, proactive collaboration, and good written and verbal communication. Also, have a clear succession plan in place especially for the C-suite. So, even with a nuclear team, you have someone to step into key positions as needed. Finally, create clear SOP documents so that any employee can pick up from where the other left off.
- Step-up your startup’s online security: Be sure to create a watertight security strategy that includes ensuring:
- GDPR-compliance of all apps (thus securing customer data)
- Encryption of data and technologies with a strong password or biometrics
- Regular updating of firmware
- Provision of security training to all employees
How Signeasy checks most of the boxes!
- Mobile-first: Signeasy’s iOS and Android apps deliver that perfect online experience for the Millennial and Gen-Z workforce.
- Cloud-based: By integrating with several cloud storage options, Signeasy lets you save and source documents from the cloud, no matter where you are located.
- Secure: Keeps your data and sensitive information safe during the exchange, storage, and signing of the document.
- Easy-to-use: No need to hire or train talent to operate this tool.
- Productivity-enhancing: By automating follow-ups and document status tracking, Signeasy improves employee productivity.
- Remote-friendly: Signeasy allows you to sign from anywhere and anytime, without ever stepping out of your home.
- Cost-effective: With rates starting at just $8 per month, Signeasy is quite affordable.
Is your startup ready for 2021 and beyond?
For startups, COVID-19 in 2021, is all about emerging stronger. It's about identifying new sources of funds, improving productivity, saving resources, and assuring end-to-end privacy, security, and data integrity.
One of the best ways to combat the challenges posed by the pandemic will be to digitize the signing workflow with Signeasy. Don't forget to check out the free trial version here.