Startups Surviving Covid-19 #1: Tom Previte of Launch22
Launch22 is a charity incubator and coworking space aimed at helping entrepreneurs off the ground. Bringing people from different backgrounds and genuinely building a culture where people are helpful to each other is really not very easy to do. However, they accomplished that, and we always admire the community there.
As we all know, Covid-19 affected London’s startups in direct and indirect ways, and it has permanently changed the landscape for London’s technology businesses like the rest of the world. We are interviewing key people of the startup ecosystem to ask them about their challenges and survival strategies in this hard time. We hope that this interview series will be helpful and insightful for other startups in London out there. Because we believe that the most important thing is to learn from each other and be helpful to others, within this direction, you are welcomed to the first episode of our “How to Survive Covid-19 as a Startup?” interview series. Let’s begin, fellas!
Watch the interview:
Work from home situation
As we know, startups are at high risk but at the same time, high-reward type of game compared to working in a very large organization. So they are much more vulnerable in times of crisis like this, but at the same time, they are more agile, and they can change direction overnight.
Tom Previte is an influential figure, and he is running Launch22. So we interviewed him and asked him questions. First of all, we ask him about his observations about how startups are handling work from home situations.
He says that: “There are many companies that will, unfortunately, fail such as bricks and mortar business, but it’s also possible to adapt and change. As we know that being startups are adaptable, and you’ll see lots of businesses changing, adapting, and creating very innovative ways to survive and actually to thrive.”
About the remote working culture
About the remote working culture and its effects on productivity, he says that this all stems from leadership. If the leaders in the organization take on the responsibility of galvanizing the team, this is an opportunity to bring teams to close together in times of hardship. There’s a common enemy, the coronavirus, and if you can use that to galvanize the team to work towards and beat that, it can make your culture stronger.
In Launch22 case, they also work remotely as a team at the moment. So, Tom just got off a call from his community managers, and in the last couple of days, they’ve had more productive and more interesting conversations. Moreover, this also happened the week before.
How Launch22 is handling the Covid-19 situation?
Launch22 have two London base locations with cool working style spaces in King’s Cross and Poplar. However, he reportedly said that their revenues had taken a big hit. They probably lost a lot in the last week and will potentially lose up to 50-60% of their revenue monthly when contracts expire.
As a nonprofit charity and a business that has overheads, they have physical spaces to manage and maintain their margins are very tight. He believes that they really have to think and are still thinking creatively as much as possible and how they can actually lower that risk. In terms of mitigating the impacts, what they’re doing is preserving their overheads. They are also thinking about how they can keep their members, keep them happy, and provide a service.
He is saying that: “One thing which we’re toying around with at the moment is that the idea about offering a more virtual membership. We have other assets like our mentors, and if they would be open about providing that mentorship virtually, that can be one of our new paths.
Additionally, we think about offering a more virtual option to the members, which are currently here. So, they can still access the mentors and access their virtual registered address without paying the full price. So, in that way, we’ll be able to keep members and our community.”
How others are handling the Covid-19 situation?
“This is not unprecedented in the business world. For us, the important thing is to say not how do we do what we’re doing but rather how we will do in a different world what we’re doing right now.
The opportunity is what will we be. It’s not how do we preserve what we had. That’s an infinite mindset.”
Tom gave us some good startup examples which transformed so fast and successfully got with the coronavirus times.
The first one is LEON. They have completely transformed the way that their business is operating at the moment. LEON transformed from a restaurant (where you go in, order a meal, sit in and eat) to a fast take-out. So, they’ve managed to keep their employees.
Another one is Mukesh, one of the Launch22 founders, will take advantage of the situation that the majority of people working from home and looking for more healthy food. He sees an increase in his smoothie subscription boxes. Now, he’s trying to capitalize on that kind of home living, healthy living set-up.
Another company we use as a third party booking platform for our space is called HireSpace. So, we’ve our venues on there, and they’ve actually created a list. They’ve collected over all of the venues they’ve got on their site. A list of all the spaces which are happy to volunteer their space up at this time for an emergency to hospitals or air centres or food points. So, they’re actually pivoting in a social way to capitalize on their asset, which is all the spaces around London that are booked on now and see if they can leverage those to support people in need at this time.
More survival strategies
Our founder Ozan Dağdeviren also adds some examples: “We have a video learning business that I’m a co-founder of which goes back to 3, 3.5 years now.
We’ve actually seen almost a 300% increase in the leads coming to that business over the last two weeks. Because people are at home and many of them cannot go outside. Our normal workshops are cancelled. So, large organizations are looking to substitute that with modern, high-quality video learning.
Another example is that a good friend of mine they’re working in intelligent home automation systems. They are essentially designing both the software and the hardware of those panels that go into these new homes and this new situation. So, for example, they’re working with the government now on a prototype of a ventilator which is very cheap and easily accessible.”
Ecosystems act and react differently than individual players like companies or people within them. So, our last question to Tom is about the London startup ecosystem in general.
What are your thoughts on the viability of building and becoming successful as a startup and/or as a founder in London in the coming year, for example?
There’ll be a lack of funding.
People will have more time on their hands.
As a result of more time, there will be more bootstrapped ideas.
These ideas will push things back up after 12 months or so.
I want to be optimistic and try to think positive. People will have a lot more free time. Everyone will have a long consolidation period. We will have more bootstrapped ideas because funding will be dried up for the LA over six to twelve months. Later, it will eventually come back, but I think at that time, people will be forced to think more creatively about how they prove the concepts of their business. This is what we’ve always promoted at Launch22.
A lot of people come to us who are trying to raise funding. We ask them first and foremost about what would be that money for. Have you proven a need and market for your product? What is your product? What are you selling?
Thanks for your insights Tom and thanks to you, our reader. Believe that everything is going to be okay soon. Stay safe, stay healthy!
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Each week, we will be visiting a new startup office to meet with their team & founders. Stay tuned!