I recently talked to more than 20 founders and CEO’s of SME’s and asked them how their business is doing during this pandemic and how they are planning to recover from it. Sadly so many of them are confused and simply don’t want to think much about it. Instead of accepting the big crisis ahead and planning ahead of it, many of them have wishful thinking of everything getting back to normal in a few week's time.
1- This isn't just corona. The market is already disrupting and it’s just starting to begin. This is the longest bull market in history finally coming into realization. Debt levels were at its peak with credit fueling spending with QE. Silicon Valley and Wall Street have been prepping for years.
2- VCs have been forcing companies to IPO or exit, Softbank's portfolio companies were underwater severely, CEOs have been leaving, Bezos/Buffett and other billionaires were hoarding cash, too many signals.
3- With Corona, we haven't seen the impact of business losses and layoffs yet. It has already started on the retail level and will start effecting tech companies as well in a month or two. Tech bros who think their jobs are safe are in a complete surprise as slowdowns and lack of liquidity from VCs will start causing massive layoffs. People will have less money to spend, causing an additional cycle of slowdown a few months away.
4- About 7 million people in the USA have filed for unemployment and it’s just the beginning.
5- The supply chain has been shut. No cargo ships, no freight forwarders, no delivery agents. 90% of ecommerce stores have paused their operations, just waiting for the epidemic to end. Well if it continues, most of them will get shut. World’s largest retail companies and big eCommerce brands are getting out of Business day by day. Think about retail stores or maybe big brands offline chains, what do you think how long they can survive in the lockdown. Check share market, it’s already on the verge of disruption.
6- PPC campaigns not giving many conversions for most of the businesses, which means there will be fewer advertisers, thereby decreasing the CPC of the campaigns but also conversions.
7- Try thinking about what could possibly happen if it continues for the next 8 months.