Are you considering starting up your own business? The reality is that the world as we know it has changed. And, no one really knows what the future holds. Consequently, it is understandable that people, especially those who have either had to take a pay cut or have been furloughed. Therefore, the biggest challenge, apart from not contracting the virus, is how to generate enough money to meet your monthly budget during these tough times.
Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â â€œIn the midst of every crisis, lies great opportunity.â€� â€“ Albert Einstein
As the quotation highlighted above by Albert Einstein states, â€œin the middle of every crisis, lies an opportunity.â€� Thus, letâ€™s start this discussion by defining the global crisis caused by the new coronavirus, COVID-19, so that we can look forward to finding the opportunity in the crisis.
Crisis versus opportunity: Setting the Scene
It is generally accepted that the novel coronavirus, COVID-19, was first seen in Wuhan, China, during the last days of 2019. This virus is a zoonotic virus. In other words, it was first seen in an animal like a bat, and it consequently jumped from an animal host to a human host. Once in its human host, COVID-19 mutated so that it could spread via person-to-person transmission.
As an aside, there are instances where it seems as though the virus has jumped back to an animal host in the form of pet dogs and cats. However, it is believed that this occurred because the petâ€™s owner was infected with the virus. And, this scenario is really nothing to worry about.
Four months later, since the first cases observed as a consequence of human-to-human transmission, the virus has swept across the globe, causing untold health and economic damage in its wake. Current worldwide statistics as of 10 May 2020, (from gisanddata.maps) show that there are over 10 million people infected with this virus and just over 503, 500 deaths. Unfortunately, these numbers seem to be increasing rapidly without an end in sight.
One of the many challenges facing the worldâ€™s governments is the fact that no one really knows how this virus behaves.
There has never been a viral outbreak of such magnitude before. Thus, the worldâ€™s scientists, medical experts, and governments are in new territory, determining what works and what doesnâ€™t work as each country moves through the peaks and troughs of this pandemic.
There are, however, a few behaviors that the worldâ€™s scientists and medical experts have observed. The most important being that because this virus is spread via droplet infection from person to person, the best way of controlling and eradicating it is through social distancing or social isolation. In simple terms, people need to stay away from one another. Therefore, the worldâ€™s governments have issued varying degrees of lockdown or stay-at-home orders.
What this means is that the global economy has been paused while we wait for the virus to burn itself out.
Secondly, this virus is highly contagious and causes a respiratory illness similar to pneumonia, resulting in the death of people who fall in the high-risk category.
Thirdly, people can be asymptomatic carriers. In other words, they are infected with the virus but have no symptoms, so they spread the virus to other people without knowing they are infected.
Consequently, this pandemic has had and continues to have a negative impact on a macro-economic and microeconomic level.
It has also affected peopleâ€™s mental, emotional, and physical health.
Governor Cuomo, governor of New York State, USA, highlighted the quintessential issue with the coronavirus pandemic in his conversation with Howard Stern on 13 April 2020. He stated that not only are we fighting a virus, “but we’re also fighting emotions on an individual level, on a collective level. People are frightened, they’re anxious, they’re stressed.” This virus is unmatched. People are trapped at home, they are not getting a salary, and they are afraid to touch another person because no one knows who is and isn’t infected with the virus.
As stated above, the economic impact across the globe has been devastating. The US jobs report released on Friday 8 May 2020 showed that the US has hit a depression-era unemployment rate.
Additionally, the npr.org website stated that 26 million people in the US have lost their jobs since early March 2020. The fundamental difference between the US, EU, and the UK is that the EU and the UK governments are paying a percentage of their workersâ€™ salaries and their jobs will be available once the respective countryâ€™s economies start up again.
Finding the opportunity amidst the crisis
Therefore, the questions that must be asked and answered are what is the new normal and how do you utilize the â€œnew normalâ€� to earn an income? In summary, the biggest part of this answer is to find the opportunity in the crisis.
Most of this discussion up till this point has been about the crisis caused by the global pandemic. And, while the socioeconomic devastation must not be underestimated, the question that begs is, how do people find the opportunity within the crisis.
The first step in finding the opportunity within the crisis is to put measures into place to survive the crisis. The next step is to position yourself for economic sustainability (openminds.com — opportunity in adversity).
Following the governmentâ€™s stay-at-home orders to the letter — practicing extreme social-distancing measures.
When you have to venture out to the shops, seek medical care, or to exercise once or twice daily — follow the guidelines. The guidelines are the way to survive this bizarre crisis. Together with these measures, it is vital to apply for any unemployment benefits that the government is offering.
Once you have implemented these measures, the next step is to start investigating ways to â€œposition yourself for economic sustainability.â€� In other words, you must start bootstrapping an online startup, because the future of the global business world is online.
The companies that have the greatest chance of surviving the global economic shutdown are the ones that have pivoted their business processes from the brick-and-mortar model to an online model. While it is true that this statement can be seen as a generalization, it is only relevant to companies that form part of the essential services industry. Otherwise, this statement is accurate for almost all of the other business organizations.
What is a startup?
Before we look at ways to bootstrap a startup, letâ€™s consider a comprehensive definition of what a startup is.
Wikipedia.com defines a â€œstartup company (startup or startup) is an entrepreneurial venture which is typically a newly emerged, fast-growing business that aims to meet a marketplace need by developing a viable business model around an innovative product, service, process, or a platform.â€�
Additionally, â€œa startup is usually a company designed to effectively develop and validate a scalable business model. Startups have high rates of failure, but the minority of successes include companies that have become large and influential.â€�
Ways to bootstrap a startup
Most importantly, the phrase â€œbootstrapping a startupâ€� translates into â€œgrowing your business with little or no venture capital or outside investment. It means relying on your own savings and revenue to operate and expand.â€�
It is worth noting that while this is challenging to achieve, it is incredibly rewarding to do so. It is also important to realize that, statistically speaking, most startups become operational without any venture capital or external funding sources. And, most startup owners are also solopreneurs.
Therefore, as a solopreneur (see: solopreneur institute dot com) letâ€™s consider a case study as an example of the ways to get your startup up and running and into a profitable operation.
Letâ€™s assume, for this article, that you are a part-time social media expert.
Consequently, youâ€™ve decided to utilize this passion and expertise to collect and aggregate social media data from some of the popular social media platforms like Facebook, Twitter, Instagram, Pinterest, CrunchBase, and LinkedIn.
Your data will be ordered and structured into information based on specific niches like engineering and construction, finance, technology, and business. The “raison dâ€™etre” (the most important reason or the purpose for someone or something’s existence…) for your startup is to track consumer behavior based on their digital footprint, including likes and shares.
Partner with a professional business services company
A solopreneur is essentially an entrepreneur who does not hire any staff. All essential business services that are not part of the startupâ€™s core function are usually subcontracted out. Thus, in our case study, the first step is to consult with a professional business services organization that specializes in company formation in Hungary to help you register a legal company.
Seek help from a mentor or advisor
The good news is that you are not the first solopreneur, nor will you be the last person to bootstrap a startup. Many experts in this field have developed tried and trusted methods and mechanisms to succeed at an entrepreneurial venture. And, they are often very willing to mentor or advise new entrepreneurs to ensure that they do not make the same mistakes and to ensure that their ventures are successful the first time around.
Draw up a budget
As highlighted above, the financial side of bootstrapping a business can be challenging. Thus, you must manage your available finances wisely. And, drawing up a budget that contains all of your fixed expenses, will help you keep a handle on your finances and assist in stripping out any non-essential costs.
Implement the â€œlean startupâ€� philosophy
Eric Ries, the founder of theleanstartup.com, states that the lean startup philosophyâ€œprovides a scientific approach to creating and managing startups and get the desired product to customers’ hands faster.â€�
It is an agile principle, with an iterative method that gets a product or service to market without spending months or years in product development without consumer approval or disapproval. Product development also occurs in small iterations or changes. It starts with a base model and then evolves into the final edition or one that gains traction amongst its target audience.
Itâ€™s vital to be aware of the fact that agile iterations are not random and haphazard. They are based on a combination of customer feedback and the startupâ€™s core mission and aim.
Invest in your brand
Brand development is one of the most significant aspects of running a successful business. Your brand is what attracts your target audience and helps convert them into returning customers. One of the most challenging things for any company, irrespective of whether it is an established business or a startup, is to convert consumers into loyal, returning customers. Consequently, it is essential not to skimp on brand development, for your brand is your startupâ€™s voice.
The good news is that, in the digital world, brand development does not have to cost an insane amount of money. The essential starting point is a good website that is usable and user-friendly, for this is where visitors to your site will answer the siteâ€™s Call-To-Action and convert.
Attract customers through content marketing
The Content Marketing Institute defines content marketing as theâ€œstrategic marketing approach focused on creating and distributing valuable, relevant, and consistent content to attract and retain a clearly-defined audience – and, ultimately, to drive profitable customer action.â€�
The following statistics show the value that brand marketers place on content marketing:
- Â 42% of brand marketers report that their content marketing efforts are successful.
- Â 60% of all marketers create or contract a content writer to create at least one article per day.
- Â Year-on-year growth metrics in unique site traffic is 7.8 times higher for content market leaders than it is for followers. Therefore, it is vital to becoming a content marketing leader, not a follower.
By way of an example, guest post blogging — see my blog — snchatterjee.com/start-guest-blogging. My blog has some useful marketing strategies –that are designed to drive unique, authoritative traffic to the brandâ€™s website.
Your new increase in authority is one of the most highly rated signals that Google uses when ranking and indexing websites on the Search Engine Results Page (SERP). Therefore, when a consumer searches for the products and services that you offer, Google will return your brandâ€™s website in the top three to five results on the SERP.
One of the most challenging aspects of the post-COVID-19 world is that no one really knows what it will look like. There are several givens regarding the way forward. The global economy has simultaneously come to a halt. And no one is quite sure how and when the global corporate world will reopen for business.
As Aswath Damodaran noted, in his YouTube chat with Noah Kagan titled, â€œNYU Finance Professor Explains This Financial Crisis,â€� the world has never been in this situation, so no one knows how easily the global economy will reboot.
We will just have to wait and see what happens. Please don’t take the uncertainty as an excuse to sit back and do nothing.
The takeaway phrase here should be “Carpe Diem” or “Seize the Day” and make the most of the opportunities found within the current crisis.