I received an email on ten steps for surviving the current business economy from “…one of the most elite venture capital organizations in N.A. (Board members include Al Gore, former U.S. VP and Colin Powell, former U.S. Secretary of State)”. I don’t actually know if Msrs. Gore or Powell personally know of these ten steps or that their name is being attached to them.
- Act now. Focus your business, cut what you need, or sell if you must.
- Protect the vital core of your business. If you have to cut, use a scalpel, not an axe.
- Get 18 months or more of cash. And do it against a conservative business plan. Plan for the worst.
- Defer expansion. Delay facilities and capital expenses. Instead of buying PCs or software, use “free technologies,” by which he means, Google Docs (which is free) and similar Web-based back office tools. Reprioritize and rationalize all your R&D purchases.
- Negotiate. In this climate, everything is negotiable, including your lease.
- Everybody sell. It’s an honorable profession. Everyone in the company should have a focus on bringing in customers.
- Offer equity instead of cash. For people who can accept it, offer to swap cash remuneration for shares of the company.
- Pay attention to where your cash is. Put all your cash into the most secure possible instruments. Money market funds are not guaranteed. Look at treasuries.
- Make sure you have leading indicators for all your revenues. 90 days is a good benchmark. You want to see the trouble coming before it hits you.
- Over-communicate. With employees, investors, key customers. Don’t sugarcoat things (and reread tip No. 5).
Funny…NextStage has run on these as business basics since 1999 and officially since 2001. Now we have offices in three countries and our work is cited and quoted internationally. Considering how many companies started at the same time we did and how many have died, I guess these rules must be good.
The two exceptions/additions I might make are these:
- If you know a tool is necessary and will be used often, get the best one possible. Quality pays for itself many times over.
- (Kind of a corollary to the above) Don’t skimp on necessities. They are necessities because you need them. Put good money into what you need, not what you want, and that good money will return to you many times over.
Any exceptions or additions you’d like to make? I’d love to read them.
Please contact NextStage for information regarding presentations and trainings on this and other topics.
- teaching a Masters Class among other things at the iMediaConnection Brand Summit 7-10 June 09 in Colorado Springs, Colorado
- doing a presentation on Machine Detection of and Response to
User Non-Conscious Thought Processes to Increase Usability, Experience and Satisfaction – Case Studies and Examples at the Towards a Science of Consciousness 2009 11-14 June 09 in Hong Kong, China
- presenting a formal research paper entitled Machine Detection of and Response to
User Non-Conscious Thought Processes to Increase Usability, Experience and Satisfaction – Case Studies and Examples at The 7th International Conference on Computing, Communications and Control Technologies: CCCT 2009, The 2nd International Multi-Conference on Engineering and Technological Innovation: IMETI 2009 10-13 July 09 in Orlando, Florida
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