Our way of business at Next Coast Ventures is “built for entrepreneurs, by entrepreneurs.” And while we’re going through this unprecedented time in history, we know we don’t have all the answers. But we do have experience and empathy. We asked members of our Entrepreneurs Council and leaders of the firm about how entrepreneurs should think about their business right now. Some actionable highlights are listed below - we hope these help.
“The most obvious is cash. I am close to a company that has seen its receivables literally balloon overnight. Payments down 50%+ year-over-year. All the old assumptions have to go out the window. Slow your payables, skip a rent payment, cut non-essentials, etc. If you are out of business, you can’t help anyone.” (Cotter Cunningham, Founder, former Chairman and CEO, RetailMeNot)
“Consistent communication across all levels. Not only from the CEO to their teams, but double- and triple-check that all managers are having consistent video calls with their teams and that they are sharing the key messages. It is so easy to get isolated or disoriented when everyone is working from home.” (Julian Castelli, Chairman, Chargeback)
“Engage your board. Sometimes entrepreneurs feel like going into their board with problems or challenges or not knowing an answer is a sign of weakness. But right now, this is a real sign of strength. The businesses that are going to survive and thrive will do so based on their collective strength, talent, intelligence, and experiences of everyone involved.” (Jason Dorsey, President, The Center for Generational Kinetics)
“Call your customers and vendors. Start at the top and call 'em to check in. I wouldn't push for cash on the first call—unless you have to, but remember they will be sitting in a Zoom meeting later this week with the topic being ‘what do we cut?’ and if they just heard from you with a supportive message, it should help. I know some people subscribe to ‘out-of-sight-out-of-mind.’ I do not.” (Cotter Cunningham, Founder, former Chairman and CEO, RetailMeNot)
“Too often, what gets overlooked in times of crisis is the customer. As a CEO, you can make ‘just checking in’ calls with your key contacts and do so without an agenda. This will build trust, develop personal relationships and strengthen your value as a vendor. There will be a time when you do make these calls with an agenda in mind. Not now. Make the relationship calls—as many as possible—with some of the time freed up from working from home. Schedule it on your calendar and make it a priority.” (Mike Smerklo, Next Coast Ventures Co-Founder and Managing Director)
“Keep making sales calls. It's easy to go into 100% defense mode. Don’t. Someone REALLY needs your product soon. Get in front of them!” (Cotter Cunningham, Founder, former Chairman and CEO Founder, RetailMeNot)“Keep making sales calls. It's easy to go into 100% defense mode. Don’t. Someone REALLY needs your product soon. Get in front of them!” (Cotter Cunningham, Founder, former Chairman and CEO Founder, RetailMeNot)
“Figure out the offensive plan and make sure everyone knows what it is. Hard to do so when you don't have whiteboards and group meetings. Be explicit and have cross-functional meetings so all who are necessary can take part in playing offense (growth/sales) instead of just hunkering down.” (Julian Castelli, Chairman, Chargeback)
“Finish scenario planning and decide what the new normal looks like. The last two weeks have been consumed by projecting different scenarios and modeling P&L and cash-flow impact. We’ve taken the obvious actions (e.g. cost-cutting, etc.). Now the teams are starting to drift back to scenario planning, and the truth is we don’t yet know what will happen.” (Zeynep Young, Founder and CEO, DataNarrative)
“I think in times like these (if your business is negatively affected) it's essential that your management team gets aligned on your top priorities, in order, to weather this crisis and come out strong on the other side. Some of the obvious things, like conserving maximum amounts of cash, preserving goodwill with employees and continuing to serve your customers at the highest levels can be at odds—and you have to wrestle with these tradeoffs as a team and get aligned.” (Brian Sharples, Co-Founder, former Chairman and CEO, HomeAway)
“I’ve had to spend time to get the leadership team off of discussing additional scenarios and into an action plan that allows us to move forward beyond the obvious immediate actions. We’ve explicitly outlined some mile-markers that will give us more direction in the next couple of weeks about where our specific industry is headed and we may revisit scenarios when we know more. But the biggest challenge has been to define an action plan for what comes after ‘immediate no regrets moves.’ I think the job of the CEO is to start defining what the new normal looks like until we know more” (Zeynep Young, Founder and CEO, Data Narrative)
“Assuming workplace safety rules and procedures are in place (with work from home being the new standard), you need to put a massive focus on measuring and driving productivity under this new paradigm. Productivity is the fuel that allows you the latitude to preserve cash while continuing to serve customers and drive sales at adequate levels, and it deserves daily communication and attention by management across all functions.” (Brian Sharples, Co-Founder, former Chairman and CEO, HomeAway)
“Working from home is a new paradigm for most people. It’s easy to get lost and work away without prioritzation. For me it’s somewhat therapeutic to do this, but at the same time, I already find myself going down ratholes of things I’m wasting time on that I shouldn’t be. My time mix is now easily talk to entrepreneurs 40% of my time (portfolio company execs, other entrepreneurs in network, etc.) but try to limit the calls to 15 minutes tops.” (Thomas Ball, Next Coast Ventures Co-founder and Managing Director)
“Look out for you. It’s so easy to get stressed out right now and worry 24/7. Get some exercise and/or fresh air every day!” (Cotter Cunningham, Founder, former Chairman and CEO, RetailMeNot)
“Showing up as a confident, enthusiastic leader is hard in the best of times. Now with all the added stress and uncertainty it is even harder. Meditate, exercise, call your mom or just read a good book. Whatever it is that brings you calm and comfort—make sure you don’t neglect yourself in these stressful and uncertain times.” (Mike Smerklo, Next Coast Ventures Co-founder and Managing Director)
Empathy is your biggest asset during this time of crisis, so don’t be afraid to deploy it widely. We hope this post helps in some way and would love to see your comments and suggestions so that the entire entrepreneurial community can benefit. There’s a lot of fear and anxiety out there, but it’s important to remember that we’re all going through this together.