TOP 5 items I'm telling every CEO
- (1) The gravity of what's at hand for the next 12 months. - This is bigger than just lock downs to do COVID. There is an economic storm coming behind this.
- Consumer spending is down, lay-offs are raising, so economies will be impacted by this. The U.S. policy for slowing the spread of COVID is not consistent, so we should expect 2nd and 3rd waves through the U.S. for the next 9-12 months. The U.S. economy will drag on the global economy, from slower investment to debt payments being called, etc. This will affect growth and consumer behavior in ASEAN
- Business travel will not resume as normal until a vaccine is found. Many countries are putting a 14-day quarantine when you arrive (or return home), so no 2-day business trips.
- Additionally, heightened tensions in the US, internally and with China, will create uncertainty till the Nov election. Markets stall under uncertainty.
- More info
- (2) You need 18+ months of runway. Fundraising should not be your first choice. There currently are 2/3rd fewer investors active in the market. A less competitive market means valuations will be lower today than one year ago. Most corporates are taking a conservative view and not investing. Or their policy requires face to face meetings which will not happen for a while. Regional family offices and conglomerates are also shiting investment into other distressed opportunities, not tech. And the VC community is split, with some being well-capitalized looking to invest, but many are between fund cycles so are reserving more for follow-on in the existing portfolio.
- (2b) Stop subsidizing growth (marketing spend, discounts on transactions, etc.) Investors will be happy with a decline in your business as a trade-off for stronger unit economics.
- (3) You may need to make drastic shifts or pivots to your business, you should do that immediately as results will take 3-6 months
- (4) Diversify into other countries. Previously, you could just focus on Indonesia or Vietnam. But in today's climate (COVID and economic uncertainty) you need to hedge your bets. Even if your product doesn't translate to other markets yet, figure out how to expand your offering so it works in other markets.
- Greater ASEAN Markets our data tells us will rebound well: Singapore, Vietnam, HK, Taiwan, Malaysia
- (5) There is opportunity out there. Entrepreneurs have the biggest innovations when constrained. Sectors that are Opportunities
Finally, everyone should read: