At VentureBeat’s Downturn Roundtable event this morning, Kleiner Perkins’ John Doerr just gave a rundown of the top 10 things startups should be doing right now to keep their companies afloat in hard times.
- Act now. Act with speed to get your business in order.
- Protect the vital core of the business. Use a scalpel instead of an axe, when cutting positions.
- Get 18 months (or more) of cash. Defer any expansions of facilities, and be frugal with expenditures. For example use Google Docs (online free software) instead of buying something like Microsoft Office for your entire workforce.
- Re-prioritize and rerationalize all your research and development. Only focus on the key hurdles for your business.
- Negotiate. You can always get better payment terms, and better contracts.
- Everyone in your organization should be selling the product. Everyone from your secretaries to your executives.
- For bonuses, offer equity instead of cash. You can also ask for a voluntary salary reduction program among employees.
- Pay attention to where your cash is. Put it in something secure — move it into treasuries or some other grounded investment.
- For the revenues you plan on getting, look for leading indicators. You may need to readjust. Basically, don’t take any revenue streams for granted.
- Over-communicate. With employees, investors, and key customers. Don’t sugar coat anything.
Angel investor Ron Conway added a key eleventh point: Be open-minded to mergers and acquisitions. Always a good tip.