These are indeed worrying times for anyone with a stake in Bahrain’s thriving, yet intensely competitive startup ecosystem. Like the rest of the world, the startup community in the Kingdom and the broader GCC region are also facing the brunt of the COVID-19 pandemic and the ensuing lockdown.
Fortunately, some encouraging reports are coming in from some of the world’s most influential economies. For example, top economists from Goldman Sachs and Morgan Stanley are confident that the economy has already bottomed out and is now showing a sign of gradual recovery.
So if you’re a startup owner or venture capitalist deeply worried about the turn of events over the past couple of months, maybe the best course of action is to stay put and wait out the storm.
On that note, we recently had a discussion with the good folks over at The Collective Hub for a quick insight into the investor community’s perspective on how to best navigate the challenges thrown in during these challenging times. Here’s what they had to say:
5 things every startup owner should know to overcome COVID-19 impact
For those out of the loop, The Collective Hub (TCH) is a startup incubator and coworking space backed by heavyweights such as Tenmou and 500 Startups MENA. Here’s what their investors had to say about
1) Investors are still willing to count on tech startups
Tech startups are almost always the biggest beneficiaries of the investor-comunity’s enthusiasm surrounding a burgeoning startup ecosystem like that of Bahrain. Even the coronavirus-induced slowdown seems to have failed to alter that status quo.
In fact, TCH investors are betting big on tech startups more than ever today because the world desperately needs innovative tech-driven solutions to overcome the unprecedented challenges that brought our society to virtually a standstill.
2) Plan for post-corona times
While investors are still willing to count on tech startups with their money, it is probably a bit of a wishful thinking at this juncture to expect immediate funding from most venture capitalists. That is so because the vast majority of them are preoccupied with keeping their businesses and existing investments afloat in these trying times.
So the best course of action for Bahraini startups at this juncture, according to TCH investors, would be to fine tune their business models to fit the post-corona world. Also, While at that, these startups should also try and enhance their tech support and development.
3) Go digital no matter what
By now, it has become vividly clear that the post-COVID-19 world will be significantly different from the one that we’ve left behind. With social distancing all set to become a norm through the foreseeable future, all startups should reinvent themselves to serve their customers digitally as much as possible. There’s simply no getting around that.
4) Don’t hesitate to seek support and government grant
As one of the most entrepreneurship-friendly governments in the whole region, the Kingdom’s top authorities will definitely hear you out if you have a strong case for seeking government grants. If possible, reconfigure your business to be a part of the solution to raise your chances of receiving all necessary support. General Motors, for example, deployed a similar strategy.
Battered by the COVID-19 slowdown, the leading automobile manufacturer was virtually forced to shut down some of its plants. However, instead of abandoning them altogether, the company made all necessary provisions to turn these plants into ventilators and respirators production units.
5) Reduce unnecessary costs
You are unlikely to raise fresh capital until the economy starts bouncing back. You most certainly should not count on contracts in the pipeline for improving your startup’s bottom-line. You’re also at the risk of having some of your existing projects postponed or cancelled altogether. Under these circumstances, your revenue is likely to take a beating, if it hasn’t already.
In view of that, if you haven’t done it already, immediately make a list of all your coming expenses and weed out the ones not necessary for the survival and sustainability of your business.
Hope these quick tips from The Collective Hub investors reinforce your ability to better handle the challenges arising due to COVID-19. Meanwhile, if you have any questions or feedback, feel free to reach out to StartupMGZN using any of our social media channels over at Facebook, Instagram, and Twitter.