Overcoming Beginner Startup Productivity Challenges in “New Normal” Situations

In the last two months, the digital ecosystem in Indonesia has begun to adapt to conditions "new normal" This. Startups begin to maneuver by developing new features or services in order to adapt to changes in consumer behavior.

From an investment point of view, DailySocial see funding activity still looks quite normal. There are even some startups that announced new funding this April. However, we cannot confirm whether this condition can continue in the next three months.

We didn't say that the startup was in phase growth or later stages minimally affected by this situation. However, we can agree that 2020 will be a difficult year for early stage startups (early stage) who are just starting to build their business.

Why is that? According to the Founder and CEO of Startup Spider Beatrice Kessler, startups in this phase generally still rely on funding from their own pockets, family funds, or from Crowdfunding. The business is not stable because it is still looking for traction of released products/services.

With limited liquidity, it is difficult for businesses to stay afloat in the weeks or months ahead. Rather, founder beginners may not pay themselves for efficiency. The space for startups to build their business is also getting narrower due to the lack of human resources and business networks.

The above explanation is also reinforced by the survey released 500 Startups titled "The Impact of COVID-19 on the Early-Stage Investment". As many as 32,2 percent of respondents see the negative impact will be felt for startups early stage.

In fact, as many as 62,6 percent of respondents predict that the COVID-19 pandemic will even have an impact on the investment climate and startup businesses early stage for 1-2 years, while 20,1 percent of respondents believe the impact will only be felt for 0-1 years.

To deal with this situation, respondents recommended a number of navigation strategies for new startups. The most suggested ways are (1) reducing costs, followed by (2) increasing runway, (3) focus on customer retention, (4) limiting market expansion, (5) closing deal funding within 3 months or earlier, and (6) limiting team use non-core.

Startup mitigation steps early stage Indonesia

The methods above are mostly recommended by the Founder and CEO of Qlue Rama Raditya to survive in the current situation. Even though Qlue is already in growth stages, the following efforts actually also apply to startups in any phase.

Most important is financial discipline. This step is very crucial considering that novice startups have runway short ones. Therefore, business people should not rush to spend it at the beginning. Set aside funding in the form of monthly allocations.

Rama also recommends product diversification to make it easier for startup to maneuver more agile. In case Gojek and Grab, they may still operate other service categories even though the main service, ie ride-hailing, temporarily closed.

Then, what about the productivity challenges with limited human resources and room for movement?

Startups early stage Legalku has taken a number of mitigation measures to increase funding efficiency without reducing targets traction. This mitigation measure focuses on two things, namely product development with a fast timeline and service deliverables permanent on time.

Founder and CEO of Legalku, Muhamad Philosophi, revealed that his party prioritizes the development of products/services that can be immediately sold to corporate consumers. For services that are complementary, it will delay its development until the workload of the technology team is reduced.

"To streamline management, we delay the development of some features or services that are not online with income," he explained to DailySocial.

Then, the company also increased deliverable service to stay on time because this situation forced coordination to be carried out remote and many government institutions closed. With this social restriction, we are trying to reduce the travel time of documents to get approval from clients through feature development e-signature.

"Initially we prioritized the development of mobile applications, then continued on features e-signature which is targeted to launch this May. However, to adapt in this situation, finally development e-signature we go first," said the man who is familiarly called Philo.

Meanwhile, startups early stage in the field of P2P Lending Acceleration revealed that productivity in product development continues to run according to plan so that the company can immediately run fast when the situation has recovered.

Co-founder and CEO of Akseleran Ivan Tambunan said there are several strategies to discipline spending, including selective in adding new human resources as long as there is no urgency, stop unused services to optimize management, and selective spending a budget marketing only those who can provide good Customer Lifetime Value to Customer Acquisition (LTV:CAC) values.

"We are trying to streamline operations and keep sustain the activities we do. Our current focus is no longer on expansion, but on maintaining the business," said Ivan.