We have collected startup advice regarding survival tactics and best practices from the brightest minds in the Nordic startup scene to help you navigate your startup company through the crisis.The impact of COVID-19 will more than likely continue for a while.
The future of your business is still uncertain at this point. But eventually, we will reach the other side - sooner or later. This means that the threatened startup environment has to do everything in its power to survive. Furthermore, the post-COVID world might look a lot different than the world we recently left.
Many startups have to rethink their business models, restructure their organization - many might have to turn the key around.
Kjartan Rist, Founding Partner of Concentric (a London & Copenhagen-based venture capital firm), recently shared some decent observations of the entrepreneurial environment regarding the COVID-19 crisis in Forbes magazine. While some startups are unharmed by the crisis, and manage to continue their growth (typically the unicorns), the majority of startup business models are not sustainable yet - this means that their existence is dependent on either funding or government-backed support packages. This leaves us with the old theories of survival and natural selection. Don’t take it word for word, but the current evolution of the startup ecosystem forces only the strongest to survive, adapt and grow. So who are they?
Those who manage will eventually become tomorrow’s industry leaders. So we want to help our startup community manage the situation in the best ways we can - that’s the foundation of our platform’s existence. Right now we want to help guide our community of entrepreneurs with expert startup advice during this time of crisis - so we reached out to some friends who know a thing or two about entrepreneurship.
We have listed a few questions for them to give startup advice upon and we are now sharing their survival tactics and best practices with our network of startups and scaleups who at this point of time have to deal with the immense pressure of navigating their business as unusual. No filter. Sit tight.
Andreas Christian von der Heide, Co-founder of Les Deux: Cash is king. Get an overview of your financial situation and do your best to cut your costs. Furthermore, try to find new sales channels and focus on selling as much as possible.
Toke Kruse, serial entrepreneur, author & speaker: The crisis is not over yet, we haven’t seen the massive impact yet. My priorities have been to look for changes by measuring on an even more detailed level. If there have been changes, there has been an action plan.
Martin Thorborg, serial entrepreneur, CEO, and Co-founder of Dinero: First of all, we make sure that all our employees are safe. We were one of the first companies in Denmark who sent all of our employees home. This quick response has resulted in only 2 out of my 45 people turning sick, which has ensured that my company has been running full speed this last month.The second thing is that we’ve had to change our leadership style and the way we communicate by changing monthly meetings to weekly meetings, weekly meetings to daily meetings, and so on. We utilize Google Hangouts to communicate more frequently and host Friday bars with entertainment and fun through Zoom. So mostly my top priority has been how we move the office from being all together physically on the same floor to now being in 45 different locations.
Aksel Larsen, Partner at Copenhagen Data: When the lockdown took effect we saw a rapid cancellation of meetings targeted at creating new sales. Being a startup with growth ambitions our financial buffer only buys us a couple months of continued operations if our revenue stagnates or declines. Our top two priorities have been:
Jakob Way, CEO at Gleechi: Our top priorities have been to secure finances and to set up distance working for all co-workers, including daily syncs, VR meetings among others.
Erik Wallin, CMO & Co-founder at Northfork: Our customers are online grocery retailers that are experiencing high loads throughout their systems. For us it has been a priority to make sure that our supporting systems to them matching recipes to available inventory are working properly.
Alexander Kragh, CMO & Co-founder Statum: Our top priority has been to save the team, not just the company’s CVR number. Therefore we haven’t let anyone go.
Frederik Mistander, Co-founder Invoier: For Invoier, the crisis has actually generated more business compared to before. As you all know, a lot of companies are suddenly struggling with liquidity issues. Our platform is one solution that can help them.We've tried to help as many companies as possible both with their financing but also ways to tackle the crisis in regards to strategy and ideas. Since we have financing for some years ahead we are still looking to hire more people and continue to grow.
Ilari Haataja, CEO & Co-founder Alvar Pet: To prevent supply chain disruption: we doubled our safety stock levels to prepare for prolonged lead times. Also, we quickly began to seek alternative suppliers for critical parts in the supply chain.Revised marketing plan: the pandemic forced us to adjust our launch plan. Offline engagement isn’t an option, so digital along with earned media has become even more essential.
Nora Huovila, CEO & Co-founder Videoly: First, we did a quick analysis of the potential implications on our business. Since then we have observed very tightly how things unfold. We have kept close contact with our customers and prospects.Luckily, since we are in the e-commerce industry, we haven’t yet experienced anything dramatic but obviously, we are entering uncertain economic times and that impacts all businesses.We modified our financial plans to ensure the continuity of our business. Our top priority is that we make it through the storm.
Joonatan Lintala, CEO and a co-founder Phaver: Keeping employees safe at home while ramping up a distributed team workflow. That’s actually a great opportunity for us to pilot a distributed team before deciding if we should go for one, so far the efficiency seems to actually have gone up compared to office work.Ensuring we have enough funding. We luckily just closed a seed round with Superhero Capital but acknowledge that the VC landscape can be very turbulent for a while and we need to manage our burn more carefully.
Jonathan Løw, COO & co-founder at JumpStory: As an entrepreneur and leader of a growth-startup, you always wear a lot of different hats. I’ve both had to handle a close dialogue with the board and our investors to keep them posted, involved and motivated; at the same time of course trying to coordinate and motivate staff members and finally the everyday tasks as – in my case – a COO so everything from partnership sales to global marketing campaigns.We have a very clear vision for JumpStory, so everything is done with that in mind, but it’s of course more challenging than usual to navigate in these unknown waters.
Andreas Christian von der Heide, Co-founder Les Deux: We went from our three-year growth strategy to handling the crisis within 48 hours. You can try to make a strategy for a crisis like this but everything changes from day-to-day.
Toke Kruse, serial entrepreneur, author & speaker: It is business as usual as an entrepreneur. Tomorrow is different from yesterday. So in that sense, life is as it has been for me the past 20 years. The best advice may be to stay calm and react accordingly to the changes that you see.
Martin Thorborg, serial entrepreneur, CEO and Co-founder of Dinero: We do accounting software and obviously, we are hard hit. Our customers are primarily small companies and a lot of them will go bankrupt in the near future, which will affect us. What we have done is that we have put in a very big effort to do a help site.So first of all if you use Dinero, you can by a press of a button have all the required numbers shown to fill-out your application to the government help packages all free of charge. We have also built a help center that is open from 08 AM to 11 PM every day including Sunday which everyone can use free of charge to receive help with the government's help packages.By doing this we are not only trying to help our target group and community survive but also help our country by making the effort eligible to all people and thereby ease the burden on our government. Of course, when all this is over with, we hope that a lot of business will remember our efforts and consider switching accounting software to Dinero.
Aksel Larsen, Partner at Copenhagen Data: Strategically nothing has changed for us. We have only made changes at a tactical level.
Jakob Way, CEO at Gleechi: No change in strategy, we have actually seen an increased interest in our VR training solutions - even though the new sales has almost entirely stopped for the moment.
Erik Wallin, CMO & Co-founder at Northfork: Right now our customers are in tactical mode, there is little gain to try to work strategically to add new functionality or working new leads. So the situation is negative from strengthening existing partnerships and building new ones. From a positive perspective, the situation gives us the possibility to think about how we would like to build our company in a longer perspective.
Alexander Kragh, CMO & Co-founder Statum: Most of our normal business disappeared from one day to another. Instead of sitting on our hands, we have changed our strategy from an operations mindset to an innovation mindset. So everyone in the team is testing and working on new concepts. Both long-term and short-term.
Frederik Mistander, Co-founder Invoier: 4 weeks ago one of our biggest challenges was how to attract the best tech people to the team. Now, since Corona, we are getting a lot of skilled and experienced tech people applying and showing interest to join our company. Many that have lost their jobs. The challenge for us has now turned into "Is this person looking for a new job just to pay the bread and butter, or does she/he really want to work with this?
Ilari Haataja, CEO & Co-founder Alvar Pet: Scenario planning from cash & business plan perspective: actively monitoring how we’ll hit the expected budget and if not, take necessary measures to secure funding post fall 2020 assuming no external help.Revised marketing strategy: we’re eyeing the situation as an opportunity to focus on digital and making it work for us, before even starting to think about branching to a wider palette of channels, offline, events etc. Supply chain: local partners, option B suppliers.
Nora Huovila, CEO & Co-founder Videoly: Exploring the US market is one of the main strategic steps for this spring. We had made arrangements to go to New York to do some initial ground work. That trip obviously was cancelled. We rethought our plans to conduct the exploration remotely with marketing.
Joonatan Lintala, CEO and a co-founder Phaver: We quickly put our initial launch plans on hold as we felt this was not the right time for the message we had. Instead we quickly rolled out the first version of recommending your favorite local services besides products and pledged a large chunk of our marketing budget to donations to small businesses.
Jonathan Løw, COO & co-founder at JumpStory: We have stopped hiring temporarily. We have been growing really fast. One year ago we only had customers in Denmark. Now we have users in more than 100 countries, so a lot of the hiring has been about serving these markets in terms of both marketing people; sales ressources and support. Right now we’re still expanding, but not at the same speed, because we need to understand, when the crisis will end, in order not to burn too much cash in the meantime. We’re not bleeding like restaurants or theme parks, but of course JumpStory is also affected by all the companies closing down; people less willing to invest and spend money etc.
Andreas Christian von der Heide, Co-founder Les Deux: We have one investor who’s really close to the company as well as personally, so we have been on daily calls with him and the rest of the board.We have adapted to the situation so going forward we are looking at how to win in this market. This means that we are looking into our opportunities and which cases we should invest in.
Toke Kruse, serial entrepreneur, author & speaker: The most important thing for me, the team and investors has been to give clear and more frequent updates about the situation on a weekly or bi-weekly basis. This efficiency gives the stakeholders an option to ask questions and feel better informed about the current state.
Martin Thorborg, serial entrepreneur, CEO and Co-founder of Dinero: We are currently not having any investors on board. But if I should give one piece of advice I would tell you to not expect anymore funding right now, and focus on running your company just like that.
Aksel Larsen, Partner at Copenhagen Data: We are fortunately fully self-owned and thus have not had to manage external stakeholders apart from our clients.Internally we have made efforts to communicate openly and honestly to our employees that we are seeing uncertainty in the creation of new business, but that our historical financial performance and committed future revenue provides us with enough certainty to weather the coming months.
Jakob Way, CEO at Gleechi: We made sure to get everyone on board early on and understand that the situation will affect short term sales, but that we have a plan for how to get back on track after the crisis.
Erik Wallin, CMO & Co-founder at Northfork: Being a part of the online grocery trade is something positive right now how cynical it may sound. But there is a stop on taking leaps in building the business. Our stakeholders are looking at our business in a bit longer perspective, and believe that we have a good position for future growth adding value to online grocers.
Alexander Kragh, CMO & Co-founder Statum: Keeping them in the loop but not overinformed. The focus is on solving problems not reporting to them.
Ilari Haataja, CEO & Co-founder Alvar Pet: Through open communication. We've shared our best view on the downside scenario from a cash perspective and mitigation plan for the identified issues caused by the crisis. This has resulted in good feedback and additional ideas from the experienced group of investors.
Nora Huovila, CEO & Co-founder Videoly: Once we saw some initial implications we made a brief summary deck of the analytics and the implications we are anticipating.
Joonatan Lintala, CEO and a co-founder Phaver: We are lucky to have investors who understand the situation and have given great advice and all our pilot test partners are very understanding of the slight delay in launching. We make sure to keep everyone regularly updated and also want to understand the situation they are in, whether as VCs or e.g. influencers or businesses we work with.
Jonathan Løw, COO & co-founder at JumpStory: We have send them updated budgets based on 3 different kinds of scenarios and explained them the different possibilities that we see for our future. One budget is the original growth one that we will continue with, if Corona soon ends. Then we have two other ones depending on how slowly the world opens up again, and the markets recover to normal. We see a development, where our Series A round will be postponed – perhaps to early 2022 -, and up until then we’re more likely to have some kind of bridge funding or loan from our existing investors and perhaps some investment-partners.
Andreas Christian von der Heide, Co-founder Les Deux: If you are a real entrepreneur you like fights like these! Try to stay calm and focus on the above mentioned priorities.
Toke Kruse, serial entrepreneur, author & speaker: Stay calm, it will pass. It is a matter of time. Don’t fall in the trap and think that this might be over in a month or two. We’re talking years, yet we will see improvements after this summer. Spend your time wisely and sharpen your sword and polish your shield for the future. Then you are ready to utilize the many opportunities that will come out of all this corona mayhem.
Martin Thorborg, serial entrepreneur & investor, CEO and Co-founder of Dinero: I actually want to give two pieces of advice. First of all, cut deep and cut fast. Don’t expect to get more funding. What you have in the bank today is probably what you will have for the next couple of years. If that means you have to fire people - fire them today. If it means that you have to cut suppliers - cut them today. If it means you would have to do more nasty stuff, that you don’t want to do - do it now and do it fast. Are you in doubt? Cut harder and faster. It’s much better to be in a position in 6-12 month and look back and say we cut too deep so we missed out on a big upside instead of saying I wish I still had my company today.Second piece of advice would be don’t spend too much time thinking of how your company could have been running. Right now it is a matter of survival. Be creative and be innovative. It’s not about following your strategy and forget about the sunk costs - throw it on the floor and don’t look back. This is only about surviving, it’s not pretty and it’s certainly not comfortable but it’s the only way to do it.
Aksel Larsen, Partner at Copenhagen Data: Take a long, hard look at your finances and simulate your cash flow for the following three scenarios:
Ask yourself how long you will be able to sustain your business, and discuss these scenarios and the need for financial backing with partners, investors or banks.
Jakob Way, CEO at Gleechi: Few generic advice to give on how to stay afloat, but I really want to stress to not forget about the team in all this. There are a lot of people who might feel insecure given the situation, that lose motivation and have their own challenges. Do all you can to support the people close to you!
Erik Wallin, CMO & Co-founder at Northfork: As every industry is affected right now, I don’t think that one advice would be relevant, however what I see gives me hope, that in entrepreneurship there is a force of change for the better. And that light glows stronger than ever during challenging times. So even if times are harsh right now, I’m certain that we will come out stronger.
Alexander Kragh, CMO & Co-founder Statum: Everyone is holding their breath waiting for the clients to start buying again but someone needs to go first. Be that company and start a chain-reaction. B2B companies will not get back to normal anytime soon but that doesn’t mean that we can’t do business with each other.
Frederik Mistander, Co-founder Invoier: Ups and downs are pretty much an everyday challenge for an entrepreneur. But the downfall in this crisis is way deeper than most experienced before. But remember; There was a reason that you started the company in the first place.Remind yourself and the team about this and that the vision is still intact. Together you will find solutions on how to pivot to adjust to the new market. Gather your most creative and positive friends for a brainstorming session: What should my company X do at the moment.Jump in the helicopter and look at it from a distance, not from the ground in the war zone. at least for a while and see what ideas you can find. Maybe this is a great opportunity to let go of some of the overload, negativity or to costly things that have been on the low priority list for a while…
Ilari Haataja, CEO & Co-founder Alvar Pet: This crisis will fundamentally change the way people buy and interact. Don't expect that everything will go back to "normal". Rather what we now see happening (e.g. shift to online) are likely to persist and businesses that adapt to the current situation are more likely to survive.Demand will be there but it might come in another form / new channel.
Nora Huovila, CEO & Co-founder Videoly: Navigating through uncertainty is a fundamental element in the entrepreneurial journey. Even life is uncertain by nature. Nobody is safe from it. This period offers you a great opportunity to practice your ‘muscles’. And remember ‘This too shall pass’ <3
Joonatan Lintala, CEO and a co-founder Phaver: For a startup the product-market fit is always fickle and can also be changed by things far smaller than corona. As always, the ones who adapt fast will survive, so get creative on what you can get done with your existing resources and/or customers if your business-as-usual is temporarily gone. In the end you might even come up with something that will boost your success long after corona.
Jonathan Løw, COO & co-founder at JumpStory: Even though I’m not a religious person, I love the serenity prayer: God, grant me the serenityto accept the things I cannot change,the courage to change the things I can,and the wisdom to know the difference.
In these challenging times I use it together with our company vision as some very strong guidelines for business development and leadership. There are things too big and out of our control, and then there are a lot of things that we can do something about. Rather than panicking due to the uncontrollable stuff, I try to keep focus on our vision, and what we can actually control as an organization.
As a startup founder, you find yourself under immense pressure. But that doesn't mean that you have to throw in the towel. It's important that you remember what it means to be an entrepreneur and what comes with it. Navigating through uncertainty is part of the entrepreneurial journey. The entrepreneurial spirit, that has always been accustomed to hard work, tough decisions, and adversity, is ultimately what keeps your engine going - so embrace it!
One of the most agreed upon startup advice is taking care of your team and organization. They are the backbone of your company, and without them there is no growth. Remember, the one's who succeeds in doubling down on organizational culture with strong, shared internal values and a clear sense of purpose will be able to overcome the storm. Be open and honest towards your team to show character and respect. Sure, the crisis will affect salaries etc. But there are other things you can do to handle this situation and limit your cutoffs.
It's important that you get yourself a proper financial overview to enable yourself to make the best possible business decisions. Whether that means to invest ressources in organizational restructuring, a new business model or fast-cutting operational costs in your staffing. Focus on what's next and make an action plan to continue your business as unusual. Forget your panic and see the new opportunities lying ahead and work harder towards those. If your revenue channels are limping, don't be afraid of being creative. You have to do your best to find new ones to reinforce your bottom line.
With a clear financial overview, you're also able to communicate clearly and realistically with your investors to get your current business case heard. Transparency is key in cooperating with your investors during a situation like this, and will help both parts understand each other. It's undeniably a key for you to ensure frequent communication between all partners and external stakeholders to stay on top of all things business.
Take out time to understand where your customer is coming from. See the status quo as it is and start to build a long-term plan around your findings. Your business must go on, and one of the best ways to do so is by listening and understanding your customer. You thought you already did, but you need to do it again - because times have changed and so have they.
Andreas von der Heide Cand.jur./LL.M. & Co-founder of Les Deux
Les Deux is a Danish born International clothing brand with more than 800 retailers across Europe. 35 people are working from our HQ in Copenhagen and we have showrooms in 23 markets.
Toke Kruse Serial founder & entrepreneur with many exits behind, author of 10 books and speaker.
Martin Thorborg CEO & Co-founder of Dinero, serial entrepreneur and investor
Dinero is an accounting software company with over 250.000 registered companies. Dinero provides software that makes invoicing, VAT and general accounting fast and simple all developed for small business owners and startups.
Aksel Larsen Partner at Copenhagen Data. Copenhagen Data offers a wide range of consulting services with the necessary tools and expertise to help grow your business using data.
Jakob Way CEO at Gleechi
Gleechi develops software to enable natural interaction between humans and the virtual world. Our solutions are based on extensive robotics research and we are the first to make free and natural hand interaction in VR possible. We use this technology to enable the next generation of learning by enabling easy setup of high quality training experiences in VR.
Erik Wallin CMO & Co-founder at Northfork
Northfork is a complete SaaS platform for your company to sell groceries by recipe and meal solutions. The technology translates recipes to products, creates personalized recipe recommendations and enables brand promotions with positive ROI.
Alexander Kragh CMO & Co-founder Statum
Statum is a digital recruitment agency. We specialize in scale-ups and the needs that accompany growth. We have digitized the manual processes, ensuring everyone a fast and efficient recruitment process.
Frederik Mistander Co-founder Invoier. Invoier is a Fintech company offering a marketplace for real-time trading of invoices. Our market place is fully automated and provides sellers with a transparent, and fair price towards the market. It’s based on a risk calculation of the actual invoice made by our in-house developed AI tool.
Ilari Haataja CEO & Co-founder Alvar Pet. Alvar Pet’s mission is to reduce the carbon pawprint of Alvar and all dogs alike. With a D2C subscription model, tailored for your dog.
Nora Huovila CEO & Co-founder Videoly
Videoly is a Nordic market-leading video technology and product video hub for both online retailers and brands. Videoly makes it effortless for retailers to get relevant brand videos and hand‑picked user generated videos to their store.
Joonatan Lintala CEO and a co-founder of Phaver
Phaver is a platform for sharing your favourite things from products to local services with friends and followers while earning affiliate revenue on any monetizable recommendations.
Jonathan Løw COO & co-founder at JumpStory. Jonathan Løw is an entrepreneur and author of several bestsellers about entrepreneurship and innovation. His company engodsag.dk was named IT-company of the year in 2008, and he has been named amongst Denmark’s 100 biggest talents by Berlingske. Løw is currently the co-founder & COO of JumpStory – an AI-based image platform with 25,000,000 high-performing images.
JumpStory reinvents the stock photo industry and offers photos, videos, icons andvectors that perform 80% better than industry standards. The company has been named ”Netflix ofimages”’ by a number of leading global media.Løw is also the author of the foreword to leadership-expert Simon Sinek’s latest book – “The InfiniteGame”.
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