In the midst of the financial crisis , the partners of the powerful company exposed the scenarios of the tough economic times that were ahead. The iconic presentation resurfaces every time the economy falters . It details what went wrong in 2008 and, more importantly, how Sequoia's portfolio companies were able to stay afloat during the recession. The advice then was: react quickly, cut costs , be realistic with valuations and have a minimum of one year of margin in the bank. "That's the generic advice," Arne Morteani, a partner at Kiko Ventures, told Business Insider , although he added that it's still true. "Because people are so programmed with that whole good-time RIP thing, sometimes the nuances get lost." The signs that confirm that a person is manipulating you In some cases where a company's underlying market is still strong and can be gained through a land grab, cutting costs and headcount could actually end up doing more harm than good, according to Morteani.
If you reduce your cash burn, you lose the opportunity to gain ownership," he says. Companies can take advantage of a recession to "clean themselves up" when their competitors stumble, he added. In these cases, Kiko does not advise layoffs . This contrasts Jamaica Mobile Number List sharply with the rest of the sector, where layoffs have been frequent . According to Adam Niewinski, partner at OTB Venture, companies can reduce their workforce and costs by up to 30% and continue growing. "It's never easy, it's never pleasant, but sometimes it's really necessary for the company to survive during the recession ," he notes. Supporting portfolio companies during a downturn is tricky: Founders are "not keen" on investors taking a more hands-on approach , but few are open to asking for advice, he added.
That's the value of advice," says Niewinski. He must share the lessons learned and be honest with the company : it will have difficulties collecting revenue next year, or at least in its objective valuation, and must work to balance growth and consumption, he insists. Companies are urged to focus on their long-term vision . "The world is ready to think more long-term, rather than the fact that we are in a difficult situation now," says Ekaterina Almosque, partner at OpenOcean. Almosque helps its portfolio companies understand resilience, focusing on high-level objectives. Magda Lukaszewicz, director of Balderton, echoed this idea, although companies take longer to achieve these goals. 2023 is full of unknowns The situation is expected to get worse before it gets better. It remains to be seen what investors will and will not fund in 2023, added Northzone's Michiel Kotting. In March.