The Slowest Startups Will Be Least Affected by the Pandemic

Another day, another story about startups collapsing under the strains of the pandemic.

It certainly isn't business as usual for most of them, with many making drastic cuts to employees and expenses in a desperate bid to survive.

Strategies have shifted radically from high-speed growth to plain old survival. Startups that once were swimming out to sea are now treading water, clinging to the debris, hoping they'll make it through. Like Titanic, but without the soppy romance.

This shift from fast growth to barely growing at all will be the death of some companies.

In fact, the startups hit most badly by this sudden change will be the ones who were trying to grow the fastest.

Here's why slower startups are more likely to survive this pandemic…

1: They're flexible

Companies that grow fast tend to invest a lot of their resources on one or two key short-term drivers.

The trouble with this is that if for some reason - say, a global pandemic - those short-term drivers are disrupted, then there isn't really a Plan B.

Slower startups, however, are likely to have various long-term operations running. Because these long-term drivers aren't as resource-intensive, you're able to juggle more of them at once.

If some of them are disrupted, then you can simply shift resources over to the ones that aren't.

This flexibility is key when it comes to surviving a crisis.

2: They're cheap

Not cheap in a bad way. Cheap in that slower startups generally require fewer resources.

They focus on building a sustainable business, meaning they don't raise a load of money and then spend beyond their means.

In the same way someone living off credit cards may struggle during a large economic downturn, so too do companies who live off borrowed money.

Slower startups who only grow as they make enough money to do so are in a much better position to survive the pandemic, and to carry on as usual once we return to normality.

They're not as resource-intensive, and they like to cut costs as much as they can. They live within their means. This helps them when the economy suffers.

3: They're free

Slower startups don't take on the pressure that comes from investors and other shareholders.

Most of the time, they've relied on self-funding and bootstrapping to reach profitability rather than raising money for the sake of it.

As a result, slow startup founders are free to think more long-term about the future of their business.

When times are tough, this long-term mindset is what helps your business survive. It means you don't make rash decisions, hurried by the pressure of a crisis (and the pressure of concerned investors). It means you consider how it'll impact your long-term strategy, and then adjust accordingly.

When you drive your car slowly, you give yourself more time to react to what's in front of you. The same is true for startups. When you move slowly, you don't go rushing headfirst into a crisis. You look at what's coming, and you change your direction.

Slowing it down

Now, this isn't all to say that fast startups are doomed. Of course, some will have the cash reserves in place to fend off the pandemic. Others will pivot successfully and zoom off in a different direction.

But the vast majority of startups are going to struggle over the next few years as the long-term impact of the pandemic is felt.

To increase your chances of survival, it's best to slow down. Or you risk plummeting over the edge.

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