It is clear that the Covid-19 crisis will bring about a new normal requiring new skill to success as entrepreneurs.
Organizations of all kinds such as governments, corporations, nonprofits (N.P.Os), and startups will have to emerge radically different than how they used to in the past.
Entrepreneurs should be quick to adapt, but it is important to find the right questions before changing our companies.
We need to understand how our customers have changed and what their priorities are as a result of the crisis. For example, do they put extra focus on safety? Are they more risk -averse? Are they more willing to save for the future? We need to find the right questions for our organizations.
The new decision-making processes
We are aware that it will be complicated to build business plans for several months ahead.
Therefore, it is important to understand if we can improve our decision-making capacity with less information and faster than we used to prior to the crisis ? Do we need to find new sources of information? Can we learn more from other parts of the world that navigated the pandemic before our country? Can we learn how other industries are adapting to the new normal?
At eColón, the company I founded three years ago, we understand that we need to respond quickly to the challenge created by Covid-19. As we are the ones that started the company in Argentina, we know how to deal with uncertainty and resilience is part of our DNA. I am proud of our team’s response and how we, not only handled our current operations in a sustainable manner , but also that we are in the process of launching two new kinds of businesses for the upcoming months, adapting quickly to the new normal.
New normal for Financial Strength
Financial strength will divide winners and losers. In the last ten years, the Venture Capital world got accustomed to new unicorns that burnt millions and millions, while increasing their valuations. I believe those kinds of business models and management practices will not have clear chances to strike back for several years.
In this new environment the new drivers will be efficiency, optimization, marginal cost cutting measures and business models generating positive cash flows. The startups that can rapidly adapt to these new requirements will be the winners in the new normal.
In emerging markets, we know that access to capital is always limited a and cyclical. I expect that this situation will be exacerbated as a result of the Covid 19 economic crisis. Therefore, only resilient companies with sustainable business models will be able to survive and grow.
What will be the role of innovation?
I am convinced that it will be a ¨must¨. The capacity to understand the new normal, the new trends and new ways of doing business are more crucial than ever.
Many industries will be transformed by new players, specially by the entry of big technology companies such as Amazon, Google and Microsoft, which will venture into new industries. Health, payments, banking and travel will accelerate their digital transformation bringing the five-year future to 2021.
Last week at Harvard Alumni Entrepreneurs we had an interesting conversation with Michael Madden the Managing Partner of Yard Ventures. He shared with us deep insights on different industries. He said that it is clear that software will eat Healthcare and the big tech will use Big Data and AI to become big players in this industry.
What about regulations
One possible outcome of this crisis is more government intervention and regulations. Therefore, companies will have to expand their capacity to work in a cooperative way with their regulators. It is clear that governments will also have to learn how to regulate in this new normal and they should be very careful not to blame the private sector for the burden of the economic crisis.
I look forward to your comments on this article