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Business lessons from 2020 – Part 2 – Safe bets

Where most people see a hurdle, an entrepreneur finds an opportunity. Starting a new venture in the post COVID-19 world is fundamentally unchanged. However there are new challenges. One of these is uncertainly. The business landscape is unpredictable. 2020 provided valuable lessons in entrepreneurship. How can we make our new ventures resilient to crises? Is there such a thing as immunity? Here we explore answers to these questions.

Resilience

A new venture starts with an idea. Budding entrepreneurs must identify business ideas which are relatively immune to economic and social upheavals. 2 major studies from late 2020 identified resilience as the key component going forward. Research conducted by Deloitte Insights defines resilience. It is ‘the ability to respond to unexpected challenges and finding ways to grow and evolve’. Entrepreneurs considering new startup ventures must build businesses that can withstand economic volatility. McKinsey Global Institute on the other hand defines resilience as being able to ‘endure short-term issues of cash management of liquidity and solvency’. Building resilience requires recognizing opportunities outside the usual spectrum of business models and a judicious approach to present expenses.

Digital identity

Startup brands with a strong digital presence have fared better than others. CoachHub and Meatable are 2 examples. A Forbes report identified online brand building as an effective strategy. Startups should create a content-rich brand identity across multiple channels. This addresses prospective consumers’ questions and builds overall brand value. Grocery delivery service HungryRoot and credit lending smartphone app Even did just that. They maintained a strong foothold during COVID-19 while their competitors lost market share rapidly.

It helps brands to find ways to understand what customers are thinking. One way to do this is by actively engaging with prospective customers on social media platforms. Twitter and Facebook are great for addressing customer concerns effectively. This helps create a strong digital identity. It also builds trust and goodwill in the target markets.

Thinking out of the box

Necessity breeds innovation. COVID-19 forced businesses to adopt innovative thinking. A recent Harvard Business Review report identified innovation as a key driving force. Omni-channel selling and remote healthcare services are examples of innovations in the startup space. Norwegian entrepreneur Karen Dolva’s robotic assistant, No Isolation is an innovative solution to some issues arising out of social distancing. During COVID-19 the startup scaled-up and diversified its product offering to expand the customer base.

The Johns Hopkins Center for Bioengineering Innovation and Design organized ‘Hackathon 2020’. This 5-day competitive event attracted over 500 startup ideas. It showcased some very innovative product ideas such as 3-D printers to make splitters and filters to enable sharing ventilators between multiple patients. Another innovation competition was organized by Slow Ventures. 19,000 participants from 175 countries contributed with their business ideas.

Innovation

Small scale e-commerce is a good proposition. Artists and craftsmen can transform their skills into profitable online businesses. Paintings, woodcraft, handmade jewelry, and knitwear sell well on online marketplaces such as Amazon and eBay. Many knitting enthusiasts have opted to make designer face masks to meet the rising demand for fashionable protective gear. Bilio Masks and CCBeanie, both small scale startups, started making and selling cloth masks during COVID-19. Platforms like Shopify, Etsy, and BigCommerce offer easy ways to setup an online shop. Etsy recently revealed that it opened twice as many new shops in April 2020 than it did in April 2019. Etsy CEO Josh Silverman remarked how “anyone with creativity and 20 cents can open an online shop.”

Hyperlocal delivery and errand services like Delivee and Dunzo are good examples of innovation. These services really took off in 2020. Business Wire reports that online delivery services are expected grow by $104 billion in the next 3 years. A Technovio study concluded that on-demand delivery services will grow at an estimated 15% over the next few years. The online marketspace will see more players like Instacart and Uber Eats enter the arena.

Many entrepreneurs have turned to providing virtual fitness training. Clients can get access to professional coaching from the comfort of their homes. Online health and fitness services have surged since COVID-19. MindBody is an online health and wellness service which offers virtual classes and home workout programs. Since March 2020 it has recorded a staggering 85% increase in demand for its online content. This includes live classes for yoga, Pilates, meditation, and similar activities. 73% of the subscribers access pre-recorded fitness videos.

Concluding thoughts

Startups create new jobs. Millions of migrants live and work in the US. They regularly transfer money to their home countries as remittances. Some of these remittances foster startup businesses elsewhere. Much new space has opened up for entrepreneurship. Startups in health, wellness, entertainment, education, learning, food, delivery, and other services are flourishing. Many of these areas are linked to basic human needs. Some carefully considered online brand building helps too.

About the author:

Hemant G is a contributing writer at Sparkwebs LLC, a Digital and Content Marketing Agency. When he’s not writing, he loves to travel, scuba dive, and watch documentaries.

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