Underestimated, the pandemic and economic crisis we are currently experiencing have taken us by surprise. For more than a month now, the French economy has been slowing down. Many start-ups in the tourism, retail and events sectors are experiencing a downturn with a sharp drop in sales and a lack of interest from investors for new deals. The situation is gloomy, but should we let ourselves be carried away by external events without reacting or thinking about what to do next?
Start-ups in the fundraising phase facing the pandemic
In the midst of the health and economic crisis, investors have put the brakes on their fund deployment. They prefer to support the startups in their portfolios rather than make new investments. As a result, some rounds of financing already underway are being finalized. Some funds continue to make new investments but focus on startups that are resilient to the crisis, i.e. SaaS, Edtech, Medtech, gaming, supply chain and fintech startups.
If your start-up is not part of these categories, access to investments will surely be slowed down during this period. While waiting for the pandemic to pass, you can take advantage of it to perfect your investment file thanks to a solid financial documentation. Indeed, in addition to your business plan and financial forecast, have you thought about preparing an “executive summary” or a “one pager”?
For start-up founders who want to raise money at the end of the year, there is nothing better than anticipating the post-pandemic period and starting to write your financial documentation. If you need help with the financial documentation, Advimotion can assist you.
The situation of start-ups that are not in the fund raising phase
If fundraising is not your priority of the year, then this crisis can allow you to strengthen several points in your company
First, it may be time to take stock of everything you’ve accomplished since you created your startup. Indeed, it is very common in the American culture to take note of the important milestones reached so as to never forget how far you have come. This gives strength and courage. From a human point of view, you will also need to keep in touch with your customer database by sending regular newsletters. It is also important to strengthen the links with your team by sharing again your vision and the final destination where you want to take your start-up. Finally, this pandemic shows us the importance of digitizing your start-up or company, for managers who were previously skeptical about the idea.
Whether the recovery is U-shaped (slow recovery), V-shaped (fast recovery) or W-shaped (recovery and then relapse), this period is a good time to reflect, prepare and anticipate your next moves.
Advimotion, your partner in growth.