Since March, most startups and VCs have focused on austerity and extending cash runway to ensure survival. While these efforts were trying and painful for management and team members alike, in some ways, these tough decisions are the clearer and more obvious steps to take in a black swan environment…to survive. Yet survival isn’t enough; companies need to thrive to win. Most of HPVP’s companies have now shifted their focus to the more ambiguous work of predicting a new future because survival doesn’t ensure success — it only makes it possible.
Success through and after COVID will come from:
- Understanding how demand is changing
- Predicting the permanence of those changes
- Meeting customers on their new terms.
We discussed (1) and (2) in a recent webinar titled Understanding Demand Changes to WIN, which includes a how-to on doing scenario analysis to consider how customers may demand and interact with your product differently in a new normal.
Today we want to highlight four strategies our management teams are deploying in our portfolio to meet customers on their new terms. We’ve been impressed by these quick moves to address evolving customer needs, including highly-creative and innovative actions that are helpful mid-crisis but may also position companies for success in a new future normal. Take a look and hear these company leaders succinctly answer three questions directly:
- What are you doing differently?
- How did you think of it?
- How do you think it may impact your business long-term (post-COVID)?
Sell to your customers in a new way or through a new channel
On-demand handyperson service Fixer.com rolled out a new channel to serve its customers as friction in traditional home visits increased. With more people now working from home, the company is offering virtual Fixer consultations to aid in DIY projects. Customers can book a video chat, hosted over Zoom, to receive expert advice before starting a project or to receive step-by-step coaching in real-time to safely and correctly implement a fix at home.
This new channel keeps Fixers on the job while tackling changing consumer behaviors as we all find ourselves at home with more time on our hands but wary of allowing strangers inside. Hear from CEO, Mike Evans:
Help customers sell to their customers via a new channel or to new customers
Tock, a reservation and event management system for hospitality, spun up a new takeout and delivery solution for the restaurants it serves in just one week. Tock To Go allows restaurants to create takeout/delivery menus and enables two-way texting for coordinating pickup and delivery. With Tock To Go, restaurants can design a specific menu for takeout/delivery, and maintain the profits they would normally lose if managing through a third-party app.
In the first 24 hours it was made available, Tock to Go saw more than 250 restaurants sign up. The newly launched product has helped restaurants maintain some semblance of normal operations while keeping staff employed. Co-founder and CEO Nick Kokonas shares more:
2ndKitchen 2Go is a free pickup and delivery solution helping local bars, breweries, and taprooms, remain open by powering to-go, pickup, and delivery orders. Its sister product, 2ndKitchen for Residential Buildings allows building managers to connect residents with local restaurants for food deliveries directly to their front door. The product can plug into an existing community website, acting as a virtual, on-demand cafeteria. Both products enable local breweries and restaurants to sell existing inventory to customers who are adhering to “stay-at-home” guidelines.
Provide a free product that has uniquely immediate value to deepen relationships with customers or prospects
The need for supply chain visibility has become more acute with the demand and supply shocks created by COVID. Over the last few weeks, FourKites has rolled out a free, public-facing Network Congestion Map to show cross-border delays by country and city/state in real-time. The map enables shippers to predict when essential goods will reach their destination by monitoring delays and helping them optimize routes to avoid those delays. In addition, the company is offering enhanced (and essential) features to both customers and non-customers, including ocean tracking for 60 days and free vendor-managed shipment visibility requests through its Network Visibility solution. This allows retailers such as grocery stores to gain real-time visibility into their inbound shipments as they work to keep their shelves fully stocked. Hear Chief Product Officer, Priya Rajagopalan, with more:
In a time when companies are looking to cut costs wherever possible, G2 is giving free access to its G2 Track product for 90 days. The solution helps businesses optimize their software spend and monitor utilization, meaning companies can find areas to reduce software costs by identifying overlapping or underused software eating up valuable cash.
Both responses not only provide tools for free when companies need them most but are also great opportunities for FourKites and G2 to build loyalty with new users who may turn into long-term customers post-COVID. Helping is the new selling.
Repurposing assets quickly to address an immediate new market need.
Fast Radius, a provider of additive manufacturing solutions, is addressing changing market needs head-on. With its rapid prototyping and production capabilities, the company is leveraging its existing assets to produce in-demand PPE including face shields, face masks, and ventilator components.
As the number of COVID-19 cases grows globally, and health systems struggle to keep up, Fast Radius has pivoted its manufacturing and supply chain to produce and provide critical supplies to frontline workers and patients. This repurposing of technology and assets is one way we’re seeing companies take a direct approach to fight the pandemic or evolving customer needs caused by COVID. Not only will its impacts be felt on the frontline, but it is also likely to drive future brand loyalty and respect from customers, partners, employees, and more. Hear from CEO, Lou Rassey:
It’s our hope that these four strategies used by HPVP portfolio companies serve as a framework for how entrepreneurs can creatively and rapidly respond to the business impact of this crisis. We expect to see many more great innovations in the coming months.
Reminder: we’ve created a number of resources specific to VC-backed companies. You can access our resource guide, along with our blog posts on modeling COVID-19’s impact, and what the CARES Act means for startups here.