Jeremy Au was recently featured on e27 (Optimatic) for his take on how Southeast Asia companies can survive and thrive in a high-interest-rate environment. Here's what he shared:
"The topline-growth-at-all-costs approach is now recognised to be over. Founders generally already understand the suddenly-popular advice to focus on contribution margins, prioritise lean operations and stay within the vision of a break-even contingency plan if future fundraising falls through." - Jeremy Au
Many founders are rightfully concerned about how long these tight funding conditions will continue. US interest rates are forecast to stop increasing but remain high for the next year. Observers believe that funding will thus be conservative for at least another year, maybe two.
I recommend that founders recognise this capital environment as the new base scenario and act accordingly to raise bridge capital proactively, cut costs and stack-rank high-ROI sales & product improvements.
By reorganizing for fiscal resilience, brave founders can thus preserve the breathing room to run time-bound experiments on efficient growth and profitability levers. The team culture will also organically evolve towards maximising learnings (and returns) for every dollar spent.
In time to come, the market will adjust to the new normal and eventually reward the startup teams that have continued to grow, upgraded their economic engines and outlasted their competitors.
"All that is gold does not glitter,
Not all those who wander are lost;
The old that is strong does not wither
Deep roots are not reached by the frost" - J.R.R. Tolkien.
Read the full article on e27: https://e27.co/how-sea-companies-can-survive-and-thrive-in-a-high-interest-rate-environment-20230522/