When the coronavirus emerged as a global crisis, nobody could have predicted the scale of economic devastation. Restaurants, entertainment, sports and brick-and-mortar retail have been hit especially hard, and many businesses have gone under with public life remaining limited. And in all but a few industries, startups are especially vulnerable.
But, some startups are thriving. What are these companies doing to put themselves ahead of the pack?
An ethos of compassion, the capacity to pivot, and digitization are all elements helping these newcomers deal with the challenge of this moment and turn it into an opportunity.
Smart leaders at any size and stage of business recognize that what happens to people outside of the business impacts them inside the organization, too. So paying attention to, and caring for, their needs is especially critical now.
The most agile companies are bolstering their people and their communities. I’ve seen examples ranging from promoting employee physical and mental health to creating a welcoming and engaging remote-employee experience, and empowering a broader community purpose.
For example, MotoRefi, a 3-year-old company that refinances car loans online, has grown from 30 to 115 employees since the spring of 2020, with all staff working remotely. It has doubled down on connecting its team with, among other benefits, free counseling and a monthly perks package. It also offers online community forums about COVID-19 with professionals outside the company as a source of support. And, it keeps its team connected with productive and creative activities: During its virtual product Hackathon with a Star Wars theme, “May the Fourth Be With You,” on May 4, the company had T-shirts and light sabers delivered to employee homes.
Lumaverse Technologies is an equity-funded software company that has consolidated group management tools for powering nonprofits and K-12 education, which grew their team by 155 percent in the past year. Since COVID-19 hit, the company’s customers have begun to use Lumaverse tools in new ways. Communities have come together to collect donations for local families who lost their jobs; coordinate personal protection equipment donations for front-line workers; and set up e-stores with contact-free pickup. In just one week, the company provided infrastructure to help an entire community crowdfund $75,000 toward providing food to people in need.
Another company manifesting a value of care in its relationship with its employees is Kinside, a tech company that partners with day cares and preschools nationwide to connect working parents with available and reliable child care. Over the summer, it encouraged all employees to book a two-week vacation from work. Leadership also strives to maintain regular communication with the remote team by using online tools to keep everyone connected. Over the last year, the startup has signed more than 1,000 employers onto its platform.
Innovation: Finding Opportunity in Crisis
Thriving startups are recognizing that the obstacle can in fact be the way, as Ryan Holiday so aptly put it in his book, The Obstacle Is The Way. They are doing the work necessary to adapt and take advantage of changing circumstances.
In the course of a few weeks this spring, Entire Productions’ events business pipeline went from millions to zero. Founder and CEO, Natasha Miller, quickly assessed the market and the emerging digital tools for remote connection, and reset her company to power better digital entertainment for employers and their remote teams and customers. Her online events—creatively paired with branded items, sent to homes—often marry company updates with education and entertainment, from mentalists to musicians and picnics to PPE. In August, she scored her third annual Inc. 5000 growth award.
Terraboost Media, a purpose-driven out-of-Home ad agency, latched onto the need for public education around hygiene when COVID-19 hit. The business created over 72,000 hand-sanitizing billboards that dispense sanitizing wipes or a shot of hand sanitizer at the entryways of grocery stores and pharmacies. The high demand for hand sanitizer during the pandemic allowed Terraboost to defy the downward trend the advertising business has seen. In fact, its business is up 600 percent since February and its workforce has grown by 40 percent.
Heads In The Cloud
Digital transformation started long before COVID-19 appeared. However, the pandemic–in particular the needs generated by the uptick in remote working–accelerated the rate beyond what anyone could have predicted. It’s no surprise that cloud companies are seeing record growth, as more companies have moved online. Startups that embrace digital experiences set themselves up for success with benefits including time savings, simpler procedures, cost savings, efficiency and availability of important data.
SonderMind, a startup that digitally matches clients with compatible mental health therapists, secured $27 million in funding in April, when much of the small business landscape was closing doors. They, in turn, bolstered the Denver-based business with tech to power hypergrowth from 30 to 200-plus employees. The company also digitized performance management, using tools to track ongoing conversations with employees, and uses built-in reporting to ensure data-led people operations decisions.
How else can startups increase the likelihood of success?
- Capitalize on the resource of time. If your product or service has become obsolete due to COVID-19, take the opportunity to see if there are other value propositions available. Adapting is the key to survival.
- Look for talent. With all the layoffs, many qualified individuals are looking for work. Build the best team you can while this opportunity exists.
- Think long term. Although the pandemic will end, the world post-vaccine will be forever changed. What value can you offer that will be needed both during this period and beyond?
- Developing trust-focused leadership within the company, promoting transparency and addressing emotional issues with the team. Investing in the internal health of an organization is essential to meeting both lean and abundant times in the lifetime of a business. Trust is the most important ingredient for successful leaders, and it’s essential to great leadership.
The era of social distancing, limited travel and constricted business will end. But while it’s upon us, those startups that wish to maximize their chances of success while the world is still managing COVID-19 can take a lesson from the ones who are thriving.
Jay Fulcher is CEO and chairman at Zenefits, a people-operations software company focused on the unique needs of small and mid-sized businesses. Fulcher has more than 25 years of experience leading technology companies as a CEO of Ooyala and Agile Software, and a senior executive at PeopleSoft and SAP.
The post Stars in a Stormy Sky: Startups Thriving During COVID-19 appeared first on Crunchbase.
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Author: Jaclyn Robinson