COVID-19 has left few industries untouched. For startups, these are uncertain times and with the outlook changing daily, it can be hard to know what course of action to take.
One of the sectors to have been most comprehensively stopped in its tracks is travel. While many businesses have adapted well to the need to work remotely, the inability to travel is impacting many international startups, which – like my own business – typically rely on in-person meetings to drive growth and maintain company culture.
At TravelPerk, we have seen the near shutdown of global travel up close. Our company manages the travel of thousands of companies; in Europe, which is now the epicenter of the pandemic, bookings are down by more than 90% across the board.
Startups are having to handle the movement of their employees being severely restricted. These limitations can leave founders feeling like their startup has lost its momentum, and the brutal truth is that for some, that will be true. But there are steps you can take right now which will protect your business, ensure your staff remain not only productive but healthy and socially engaged, and help you pick up when the dust settles with energy and optimism.
Countries including Italy, France, and Germany have largely closed their borders in response to COVID-19, while the UK has advised against all non-essential travel abroad. Governments are taking these decisions in the interest of public safety. It sounds obvious, but it is vital that you prioritize above all else the safety of your employees and do your bit for the wider public good.
As we adjust to lockdown across Europe, keep paying attention to local and national advice on COVID-19. The past weeks have shown how rapidly the situation can evolve. Keep your own internal travel guidelines updated based on that public advice. And don’t let any of your team, no matter how senior, be exempt from these guidelines. At TravelPerk, we’ve built our own internal “Corona Dashboard” for employees to check, and we’ve launched a COVID-19 portal with a series of articles providing a range of practical guidance.
If you have members of staff that are still abroad your priority should be to help get them home. Expert providers like International SOS can help with repatriation and provide up-to-date information to keep them safe.
Keep going even through lockdown
Humans have a basic need to meet in person in order to build meaningful relationships, and this is not going to change. As we’ve found out in the last week or so, near-universal remote working is very different in its rhythm, its demands on us as individuals, and its challenges for businesses as a whole to what we are used to.
I am really proud of how well the TravelPerk team has adapted to 100% remote working. I’m not concerned about productivity, but as a leadership team, we’re well aware that over time there is a risk that employees will begin to feel cut off and isolated.
Founders should lead by example and encourage regular check-ins, via video call, for internal teams and clients. Try to provide a surrogate for face-to-face socializing too – whether it’s a happy hour via Zoom or a communal lunch hour from everyone’s kitchen table. You’ve no doubt been using some kind of video conferencing service already but, if you haven’t previously, now is the time to invest in a paid license.
For many startups, I know this period may feel like stagnation. Your pipeline may have been affected, and you are likely to have closed down your offices. However, as long as your business is on a firm footing in terms of cash and runway, this difficult time can also be an opportunity. Invest in R&D. Refine your strategy and offering, or add new features to your product line, so you can come back even stronger once this crisis ends. Because it will end.
Control your runway
More than one politician has compared the current situation to being at war. For a business, it really isn’t very different. Cash is king and you must protect your business by making sure you have enough of it.
Right now you need to do some basic things.
First up, review your Opex budget, all of it. Cancel or pause any recurring spend that you don’t 100 percent need. Renegotiate your contracts with suppliers. They won’t want to lose customers during a crisis, so they may well be open to better terms. Take a look at every big spend, and consider pausing it until the crisis is over. Also, don’t do an out of home campaign right now. No one is leaving their home for a while.
Next up, do what you can to extend your runway. Go back to your investors to see if you can negotiate a new internal round. If you have less than 12 months cash in the bank, you’ll need to address this now, before it becomes an issue.
Looking to the future
Going forward, companies should continually review their COVID-19 crisis plan. This could be a regular leadership conference call or a company-wide discussion to gather employee feedback. The situation is moving fast; make sure you are too.
On an encouraging note, we have started to see some recovery in the number of business travel bookings in China, Hong Kong, Taiwan, and Singapore, where the pressures of COVID-19 are easing by comparison to some European countries. These are early signs, but they remind us that sooner or later, this crisis will pass.
In fact, although this might sound crazy, now could actually be a smart time to start thinking about booking future business travel for later in the year. Travel prices right now are at the lowest they’ve been in decades, so if you have a big conference or company event in Q4, now could be the time to book it. Of course none of us know when normality will resume but there are tools available that can give you the flexibility and reassurance if you do need to cancel – we’re seeing a lot of demand for exactly this from our customers.
Meanwhile in Europe, disruption from COVID-19 is the new normal for startups, at least for now. This is a tough period, but there are steps you can take to ready your business for when the virus retreats and restrictions are lifted. When COVID-19 passes, demand for your services could increase to an even greater level than before – make sure you’re well placed to take advantage of this and hit the ground running.
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