5 Things to Do Now to Propel Your Business in 2023
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Entrepreneurship is a daily leap of faith. In times of economic uncertainty, that leap may feel like a dive off a cliff. We are currently in one of these times. It will likely take months to adjust to the forces that have ravaged the world’s economy. Entrepreneurs can feel years.
Entrepreneurs can thrive in any economic environment. Here are five things you can do to propel your business ahead now and through the difficulties of business cycles for years to come.
1. Learn the lessons of more challenging times
A rocky economy presents a unique opportunity to make tough decisions about the business plan. Everything is up for reexamination. What has changed in the market? Are your customers facing challenges that create new opportunities for your solutions? What are your options for addressing these new challenges?
Critically evaluate your product roadmap. Is it time to pivot? Prioritize the most profitable features that can be achieved in the next twelve-months. Remove projects that don’t fit that criteria and re-assign the resources accordingly. Re-assess pricing. Although inflation is at its lowest point in 40 years, transportation and raw material costs are still high. How will this affect your customers?
It’s been a tough year for hiring. Many companies have taken the best talent they could find. It is time to let go of employees or gig workers who might do better in a new job. Make tough-minded corrections that will pay off overall — corrections that might be avoidable in less challenging times.
2. Tighten your grip on cash
Venture capitalists are pulling back. In the third quarter, Crunchbase reported that funding for startups in U.S. and Canada fell 50% year-over-year. Values are down across all sectors. If you are fortunate enough to be a later-stage startup that benefited from VC largess in 2021, make your last raise last longer than intended.
Keep your dry powder dry and wait until the markets are clear to raise another round. For companies in early stages, which have less market validation and are further away from exit potential, it is important to emphasize the basics. Delay all capital expenditures. If possible, use the hybrid model to reduce rent and other office costs. Keep using Zoom or Google Meet. This is not the right time to increase travel costs. Re-negotiate fees with service providers. Seek credit terms with key suppliers, in a word, bootstrap.
3. Talk to customers in person. Now.
How have the business needs of your customers — whether paying or beta — changed over the last 18 months? Is there a benefit to your solution that is more widely recognized? Nearly every business, for example, from corporates to startups, has been forced to re-learn the lessons of supply chain management. Startups that can help their customers make better business decisions based on artificial intelligence (AI), reduce costs by improving inventory management or protect against out-of-stock scenarios by identifying and building relationships with new, more local sources of supply will have an edge.
4. Non-dilutive capital
According to PitchBook, venture capitalists are showing greater interest in portfolio companies “whose satellite, robotics and software tools can do double duty” in military and commercial markets. International conflicts are one reason.
Another is that the defense and military security industries are generally viewed as recession-proof. Our firm routinely encourages portfolio companies to consider non-dilutive funding from the Small Business Administration — grants to support cutting-edge technologies range from $150,000 to more than $1 million. Navigating the application process is not for the faint-hearted. Startups must be realistic about the work involved. However, in many states there are resources available to help. Technologists review and evaluate proposals submitted to agencies for funding. At a minimum, this can be terrific feedback and a great source of industry contacts.
5. Blue-chip cultures attract blue-chip talent
Company culture can be an asset or a liability. A rich, inclusive culture can help key hires say yes. It is important to find stakeholders who believe the same things as you do and who are aligned with your values. This will increase your chances of them sticking with you through good times and bad.
After months of “great resignation fever”, the over-heated talent market may be cooling down. Perhaps offers aren’t as quick or as grand as they were one year ago. Perhaps Twitter isn’t the only advanced technology company to let people go. The search for great talent is not something that a young company can turn off and on. While startups might adjust the hiring process or the number of employees, they should still be available to recruit and filter for cultural fit.
With the right mindset and intentional approach, an entrepreneur can make 2023 a year to strive and thrive. Yogi Berra, my favorite player in baseball, said “Swing at the strikes.” The right swing can make even the most difficult pitch into a hit in business, just like baseball.
I have been writing professionally for over 20 years and have a deep understanding of the psychological and emotional elements that affect people. I’m an experienced ghostwriter and editor, as well as an award-winning author of five novels.