The future is never certain, but there’s never a less certain time than in a recession.
So, regardless of whether you think you have a recession-proof business, it’s a good idea to conserve money for your startup during a recession.
Here are some tips to help your startup get through this upcoming recession.
Readjust your growth strategy
In the startup phase, growth is always a focus.
But with a recession on the horizon, growth isn’t always a possibility.
And if you plan to over-invest in things like marketing and sales, it could be the kiss of death for your startup.
Your new strategy will depend on the phase of business you’re currently in.
Mature startups are better-suited to weather this storm, but preparation is still necessary.
If you run a mature startup, adjust your growth strategy to something more sustainable.
If you’re heading up a young startup, look for ways to generate cash to sustain some growth.
Venture capital funding is going to be scarce.
Know what kind of funding to expect
In a period of recession, know it will be much more difficult to raise capital from venture capitalists and other investors. Still, it’s possible.
If your startup has a chance to flourish through the hard times, you may find some success.
But you should expect to give more equity for each dollar during a recession.
Reconsider your physical presence
If your plan included retail storefronts or office space, you may want to consider readjusting your strategy.
In a recession, these things only equate to greater risk.
Instead, you may want to shift to an online-only retail model and/or run a remote workforce.
By saving money on overhead, you can conserve much-needed capital to focus on sustaining your business during the recession.
Consider guerilla marketing
Traditional advertising methods are pricey and only getting more expensive.
That’s why many startups are turning to guerilla marketing to support growth for their brands.
Guerilla marketing describes a grassroots campaign that costs very little but has the ability to go viral through social channels.
With the right strategy, you can grow your brand and generate cash flow on a very small investment.
Tighten your recruitment process
The team you choose can make or break your startup at any time, and the stakes are even higher during a recession.
A new hire can improve your bottom line or bleed your company dry.
This is why your new hires are crucial at this time.
Look for passion in a resume before you even entertain an interview.
The employees you hire are going to make an impact on company culture and morale, so this is an important step.
And in a recession, it’s a good idea to think about addiction and the workplace.
Be sure to set clear policies for employees, so they understand the actions that will be taken if they develop a problem with drugs and alcohol.
Overall, your recruitment and onboarding process need attention now more than ever.
It’s a time to make calculated decisions about who you hire and what you expect of them.
It should always be a mutually-beneficial relationship, but in order for that to happen, it has to be the right fit.
It can definitely be scary to run a startup during a recession, but don’t let the scary stories bring you down.
Remember that your business is as unique as you are, and everyone has the opportunity to pull through a recession.
Make smart decisions about things like budgeting, overhead and payroll, and your startup will have a much better chance at getting through the recession intact.