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Recession - new businesses should see it as an opportunity
"Faster, focused, realists running new businesses will have the edge in this downturn" - Charles Cohen, entrepreneur
At a packed Mashup* networking event held at BT Centre, serial entrepreneur Charles Cohen told senior figures from the digital technology industry not to fear recession but to put in place a robust strategy that should not only get them through the next few months but bring them out the other side ahead of the competition.
Charles told the meeting that he found a recent statement by Facebook founder Mark Zuckerberg "bordering on the insane"... "Zuckerberg suggests that scale is more important than revenue. Well I've been through the mill on this one and I can tell him that making money is pretty well everything."
In the same Daily Telegraph article, Tony Fish, Mashup* Event partner, was also quoted on the prospects of a recession saying "hundreds of companies with unrealistic business plans and no ideas for revenue stream will be weeded out."
Charles Cohen is now Chief Executive Officer and Co-Founder of the successful Probability plc., but it wasn't always so. Founder of the iconic Beenz in the heady days of the dotcom boom, Charles has seen the good times come and go, and then come back again. He now follows the philosophy that success is making money, not in building dreamscapes.
His advice to the gathered entrepreneurs and investors at the event came in three parts:
1. Get the suffering in early - don't dodge the issues. If it looks like you might well have to make cuts, do it now. Don't wait for the early signs of a death rattle. By making cuts faster, you extend the life of the company during which time a number of positive things may happen, including an upturn in the economy.
2. Follow the money - if out of product lines A, B, C and D everyone is buying B, scrap the rest and concentrate on product B. The market is always right.
3. In times of difficulty, maintain your marketing - cut back on corporate costs and expenses but preserve your marketing budget. Large companies invariably make cuts in marketing which allows the smaller players to have a greater voice and strengthen their market position.
*Mashup is a membership based organisation of executives, entrepreneurs and investors affected by and working within the commercial application of digital technology, products and services. It enables its members to discuss, debate, demo and share ideas and opinion on the latest relevant innovations and the commercial opportunities available.
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