Grega Potokar, CEO of ABC Accelerator has seen it all when it comes to start-ups. But even for him, the situation with the coronavirus came as a surprise. Nevertheless, he says “Please, do not waste a good crisis.” He says that innovative and disruptive solutions are often born out of crisis and challenges, rather than prosperity. When there are major shifts of power happening, it is easier to find your own piece of the market, especially if you are a start-up and can react fast. It is important for startups to really focus on their product – market fit, now more than ever. In order to survive this challenge, it is crucial to “make two steps backwards”, and “return to the Business Model Canvas and closely monitor the messages coming from the market.” “A good startup is a reflection of the market”, he insists. If you do not listen to the market you will fail sooner rather than later. The situation with the COVID-19 will only speed it up, but not cause it.
Even in the industries most affected by the quarantine and other restrictions, adaptation is possible. He mentions Flexkeeping, a successful ABC alumnus, who was in the hotel industry before the crisis. Their major clients were hotel chains which were forced to shut down because of the quarantine and travel restrictions. Their revenue went almost to zero in a matter of days. However, they adapted fast and offered cleaning and disinfection services instead, which prevented them from bankrupt. When the touristic sector recovers, they will be able to pivot again, something they would not be able to do if the crisis destroyed them. Another example is Beeping, startup that offers home and office cleaning. They too responded to the new needs on the market and offered disinfection rather than regular cleaning services.
Perhaps this lesson in the form of coronavirus is a good thing as it points out to the mistakes that so many companies make at their beginning. Startups should always test their assumptions, not rely on them.
AB Accelerator also pivoted quite significantly during these times. “In a matter of days, we switched from personal meetings to webinars. We’ve made some mistakes along the way.” But as he stressed several times during the conversation, it is important to react to the changes and worry about the mistakes as you go. There is always time to learn from your mistakes, but if you wait too long, others will grab their share of the market and your chance will be lost. In other words, “survival rate of startups will be high among those who can adapt to changes in the market, whether this is caused by COVID-19 or something else.”