With Covid 19 turning business on its head, the new concomitant threats can also pose new opportunities for businesses. When it comes to seizing those new opportunities, startups can find themselves in a position to act faster than many larger companies.
So how are Founder Institute Oslo startups dealing with the Covid 19 crisis? What impact has Covid 19 had on some of our startups? How have some of our startups been proactive during Covid 19? And what advice do some of Founder Institute Oslo’s startups have for others during this unprecedented period we are living through?
I reached out to five Founder Institute Oslo startups: TotalCtrl, Generation Mobility, GimmeFood, Visualyst and Allva to share not only what they are doing to make the best of a difficult situation, but possibly how they can gain a commercial advantage in the long run.
The Impact of Covid 19
Let’s start with TotalCtrl, founded by Charlotte Aschim, and alumnus of Founder Institute Oslo June 2018. TotalCtrl helps eliminate food waste. The TotalCtrl solution exists for five primary users: 1) restaurants 2) municipalities 3) grocery stores 4) households and 5) food banks. Restaurants have been the greatest revenue source for TotalCtrl. When government measures closed down restaurants, TotalCtrl felt the pinch in its wallet. While at first restaurants stopped using TotalCtrl because of the shutdown, some have returned to using the service because they realise that now is a good time for them to clean out their inventory and digitise. So when things reopen, they will be able to enter a new routine. Charlotte explains that as customers understand more about how TotalCtrl helps with traceability, restaurants will both save money and prevent food waste.
Charlotte elaborates that if your startup is losing its paying customers due to Covid 19, then you need to consider what message you are conveying to your customers. By adapting the message to the situation, TotalCtrl gave extra emphasis to its long-term benefits for restaurants. ’We had to make our customers realise that once you get back on your feet, this would make sense to have in place because that would give you a fresh start.”
Another Founder Institute Oslo alumnus of June 2018, Generation Mobility, had a timeline to launch its well-being and counselling platform, SALUS, in the summer of this year. But because of Covid 19, Alicia Partee, CEO and Co-Founder, states that she anticipates ‘many people are going to experience some type of challenge with well-being, whether it’s emotional, psychological, etc.’ as a result of the Covid 19 situation.
Alicia’s Co-Founder Walaa Abuelmagd expounded, “Suddenly Covid 19 happens and there is a shift — there’s an extreme shift at a fast pace. So a lot of companies and people are trying to access services that will help them with regards to their well-being. So with our company, this is the right time, this is the right place to be.”
Three of alumni from the March 2019 cohort of Founder Institute Oslo also shared their stories about the impact of Covid 19.
When Covid 19 reached pandemic status, Founder, Ivana Milojevic, of GimmeFood, was about to launch her solution for Serbian restaurants to connect with customers who have dietary restrictions. The timing couldn’t have been worse. However, with farmers’ markets also closing down Ivana saw the opportunity to help farmers connect to their customers with the help of her solution.
Founder Miguel Silva, of Visualyst, helps video creators, regulators and distributors manage compliance checks faster, and says that there were two ways that Covid 19 impacted his startup. The first has to do with trade shows being cancelled because it was at trade shows that Visualyst planned to connect with new customers and to reach its goal of three beta customers by June 2020. When working from a home office, it becomes more difficult to reach this target. The second impact is about timing for a round of fundraising from September to December 2020. Capital markets for startups seems to be up in the air at this time.
As for Allva AS, founded by Heidi Myrmo, whose platform helps people plan events, Heidi shared, ‘It’s no surprise that the wedding and event industry has had an impact from Covid-19. Not only are there events with a lot of people, the season is short and just ahead of us. There is still uncertainty about having a wedding this season at all, and many have already postponed their wedding to next year. This affects us as one of our revenue streams comes from vendor’ (commissions). ‘And we have also noticed that advertising is not prioritised with the industry right now, so Covid has affected two of our three revenue streams.” The third source of revenue is from subscription fees.
How Startups Can Be Proactive
So with the harsh reality Covid 19 has on many startups, what have they done to be proactive?
Charlotte reflected, “When the crisis hit, we reached out to everybody that we saw having positive effects from the crisis’ such as ‘online grocery stores and others like catering companies and producers.’ TotalCtrl asked them whether they could do anything to reduce their stress, ‘Can we provide you with any information, any IT support?’ We reached out to a lot of different players within the entire value chain just to see where there was potential for us to help. Since we’re experts within technology, we know the industry so well, we are able to adapt our solution to fit their needs also.”
Alicia shared that Generation Mobility has been 'able to fast-track the development of’ the Salus platform, 'to get it done sooner, push through the testing, so we could be able to help people sooner than later.'
Miguel noted that Visualyst developed a contingency plan taking into account the cancelled trade shows and the timing of their next investment round. “We realised we will need to live longer with the capital we have already raised and cut costs accordingly. We are also looking for alternative financing, mostly grants and accelerator funds.”
Heidi expressed that for Allva, it is about “being there for our audience and our vendors. We offered free advertising for winter weddings, for our vendors. We have been very present in social media, in talking to, advising and listening to our customers. The two articles we have published about Covid-19 have led to several inquiries from journalists and a high Google ranking. We have also given away a couple of subscriptions, and offered personal counselling. As we have seen several of our competitors being quiet about the whole situation, I’m confident that our proactive approach has strengthened our brand further.”
Ivana mentioned that "Since Gimme Food is relating to the food industry we decided to increase our offer and include small food producers and farms (beside restaurants). This will give them a new sales channel and simultaneously make GimmeFood more attractive.”
Advice for Startups
When it comes to offering advice to other startups and how to adapt to Covid 19, Charlotte says that it’s not just about reducing costs, but about looking for potential in other areas. 'See where your existing solution could fit in. Look for customers that you know are also able to pay you. If you don’t have a product that fits them, make sure you ask them what they need and maybe you’re able to be more of a consultant to start with. Then in the long run you can introduce your product and you’ll get back to your core.’
If you don’t have a year and a half of cash, you’ll need to get some revenue in, so Charlotte suggests, ‘it won’t be the core of what you were thinking before the crisis hit. Adapt to the situation and reach out to customers that you can learn from that are within the same sector, technology or anything you could benefit from as well. Think about your customers’ needs and where you can get cash from. Be creative and use what you’ve already built…or be consultants to get money.’
Another Co-Founder from Generation Mobility, Kathra Saba, recommends that startups: 1) demonstrate adaptability and flexibility and 2) look to their partners to co-create new solutions to help others cope with the Covid 19 situation. 'We have been actively transparent when communicating the situation with our team, partners and investors and have worked collaboratively to make sure that we keep our focus on the core strategy and do necessary changes to make sure that we keep growing as a company. This situation has as well opened up opportunities for new solutions and products.'
Miguel advises that each startup is different and everyone’s need to adapt will vary. “Companies need to do scenario planning: how will things look like under the worse case scenario, likely case scenario and best case scenario. Follow up the figures month on month and implement the appropriate plan accordingly.”
Heidi’s advice to other startups is to “be honest, listen to what their customers actually need and want in this situation, and be flexible. This is not the time to be married to your one-and-only business model.”
Ivana suggests that startups “search for solutions that are compatible with the new reality.”
This post was written by Dimitris Polychronopoulo, Director of the Oslo Founder Institute and was originally published on LinkedIn.