Coronavirus
Impact of COVID-19 on startups
COVID-19 has had an immediate impact on travels, the hospitality industry, sporting events, movies, restaurants and schools.
COVID-19 has had an immediate impact on industries that cluster people: all types of travel, the hospitality industry, sporting events, movies, restaurants and schools. Large companies are telling employees to work from home, and large retail chains are shutting down their stores.
The ripple and feedback of all of these closures will have a major impact on our economy, so if you are leading any startup or small business, you have to be asking yourself, “What is Plan B? And what is in my lifeboat?” Here are a few thoughts about operating in uncertainty.
Survive
This is pretty obvious. If you do not survive, there is no upside. So all of the strategies below are about survival. It is time to put aside the wonderful plans to become a huge company with world-beating products. None of these matters if you don’t survive.
Cash is king
Startups don’t generally die for a lack of ideas. They die because they run out of cash. Put in place a plan to conserve cash. Early action will be much more impactful than later action. Have at least 12 months of cash on hand, because that is likely what you will need. Even if the COVID-19 crisis resolves itself much sooner than that, the turmoil left in its wake will persist, particularly for startups.
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Revenue is likely to be curtailed
Unless you are supplying a product or service that is considered absolutely mission-critical, you should expect that revenue will be deferred for at least three months, probably longer. If your existing contracts have cancellation clauses, expect that some will be exercised.
Impact
It’s no longer business as usual for the rest of the economy. Millions of jobs may be lost in the next few months, as entire industries are devastated. The questions every startup or small business CEO needs to ask now are:
- What’s my burn rate and runway?
- What does my new business model look like?
- Is this a three-month, one-year, or three-year problem?
- What will my investors do?
Burn rate and runway
To answer the first question, take stock of your current gross burn rate: How much cash are you spending each month? How much of that goes towards fixed expenses (those you can’t change, such as rent)? And how much goes toward variable expenses (salaries, consultants, commission, travel, supplies, etc.)?
Now take a look at your bank account. See how many months your company can survive burning that amount of cash each month. This is your runway – the amount of time your company has before it runs out of money. This math works in a normal market. Unfortunately, it’s no longer a normal market. All your assumptions about customers, sales cycle and most importantly, revenue, burn rate, and runway are no longer true. If you’re a startup, you’ve likely calculated your runway to last until you raise your next round of funding. Assuming there was going to be a next round. That may no longer be true.
Your new business model
It’s the nature of startup CEOs to be optimistic, however, you need to quickly test your assumptions about customers and revenue. Next, you need to take a deep breath and try to gauge how long this problem will last. Is the shutdown of businesses going to be a temporary blip in the economy, or will it drive Nigeria into a long recession? If it’s just three months, then an immediate freeze on variable spending (hires, marketing, travel, etc.) is in order.
But if the effects are going to reverberate in the economy longer, you need to start reconfiguring your business. You need a lifeboat strategy. If you were selling online versus in-person, you may have an advantage (assuming your customers are still there). Or you could change sales strategy. Do you need to alter the product? Revise your sales revenue goals and product timelines, create a new business model and operating plan, and communicate them clearly to your investors, and then to your employees.
Remember, no winter lasts forever, and in it, smart founders and VCs will be planting the seeds for the next generation of startups.
Coronavirus
COVID-19 Update in Nigeria
On the 2nd of March 2021, 479 new confirmed cases and 8 deaths were recorded in Nigeria
The spread of novel Corona Virus Disease (COVID-19) in Nigeria continues to record significant increases as the latest statistics provided by the Nigeria Centre for Disease Control reveal Nigeria now has 156,496 confirmed cases.
On the 2nd of March 2021, 479 new confirmed cases and 8 deaths were recorded in Nigeria.
To date, 156,496 cases have been confirmed, 134,551 cases have been discharged and 1,923 deaths have been recorded in 36 states and the Federal Capital Territory.
A total of 1.54 million tests have been carried out as of March 2nd, 2021 compared to 1.49 million tests a day earlier.
COVID-19 Case Updates- 2nd March 2021,
- Total Number of Cases – 156,496
- Total Number Discharged – 135,136
- Total Deaths – 1,923
- Total Tests Carried out – 1,544,008
According to the NCDC, the 479 new cases are reported from 22 states- Lagos (153), Enugu (75), Rivers (50), FCT (40), Kaduna (18), Ebonyi (17), Plateau (17), Edo (17), Borno (16), Oyo (12) Kano (11), Abia (10), Cross River (10), Taraba (9), Nasarawa (7), Bauchi (4), Bayelsa (3), Delta (3), Ekiti (2), Niger (2), Ogun (2) and Akwa Ibom (1).
Meanwhile, the latest numbers bring Lagos state total confirmed cases to 56,001, followed by Abuja (19,274), Plateau (8,911), Kaduna (8,531), Oyo (6,746), Rivers (6,544), Edo (4,607), Ogun (4,398), Kano (3,764), Ondo (2,983), Kwara (2,931), Delta (2,576), Osun (2,433), Nasarawa (2,234), Enugu (2,078), Gombe (2,051), Katsina (2,030), Ebonyi (1,881), Anambra (1,726), and Abia (1,530).
Akwa Ibom has recorded 1,519 cases, Imo (1,497), Borno (1,292), Bauchi (1,232), Benue (1,188), Niger (917), Taraba (813), Ekiti (804), Bayelsa (772), Sokoto (769), Adamawa (762), Jigawa (496), Kebbi (377), Cross River (334), Yobe (268), Zamfara (219), while Kogi state has recorded 5 cases only.
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Lock Down and Curfew
In a move to combat the spread of the pandemic disease, President Muhammadu Buhari directed the cessation of all movements in Lagos and the FCT for an initial period of 14 days, which took effect from 11 pm on Monday, 30th March 2020.
The movement restriction, which was extended by another two weeks period, has been partially put on hold with some businesses commencing operations from May 4. On April 27th, 2020, Nigeria’s President, Muhammadu Buhari declared an overnight curfew from 8 pm to 6 am across the country, as part of new measures to contain the spread of the COVID-19. This comes along with the phased and gradual easing of lockdown measures in FCT, Lagos, and Ogun States, which took effect from Saturday, 2nd May 2020, at 9 am.
On Monday, 29th June 2020 the federal government extended the second phase of the eased lockdown by 4 weeks and approved interstate movement outside curfew hours with effect from July 1, 2020. Also, on Monday 27th July 2020, the federal government extended the second phase of eased lockdown by an additional one week.
On Thursday, 6th August 2020 the federal government through the secretary to the Government of the Federation (SGF) and Chairman of the Presidential Task Force (PTF) on COVID-19 announced the extension of the second phase of eased lockdown by another four (4) weeks.
Governor Babajide Sanwo-Olu of Lagos State announced the closed down of the Eti-Osa Isolation Centre, with effect from Friday, 31st July 2020. He also mentioned that the Agidingbi Isolation Centre would also be closed and the patients relocated to a large capacity centre.
Due to the increased number of covid-19 cases in Nigeria, the Nigerian government ordered the reopening of Isolation and treatment centres in the country on Thursday, 10th December 2020.
On 26th January 2021, the Federal Government announced the extension of the guidelines of phase 3 of the eased lockdown by one month following the rising cases of the coronavirus disease in the country and the expiration of phase 3 of the eased lockdown.
On 28th February 2021, the federal government confirmed that the first tranche of Covid-19 vaccines will arrive in Nigeria on Tuesday, March 2nd, 2021.
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Coronavirus
Peter Obi urges FG to beg manufacturers, rich nations for COVID-19 vaccines
Obi urged the FG to consider appealing to rich nations, drug manufacturers for vaccines instead of spending billions of nairas to procure them.
