Guest Column: Ten Tips for Startups to Ride Out the Slowdown

The US Silicon Valley’s venture capital industry, the primary source for venture capital in India, is in crisis with exits via initial public offerings down to a trickle — only six worth $470.2 million in the first nine months of 2008 (Source: NVCA). Trouble with exits implies that investments in new companies also slow down. Indian startups will find it tough to raise fresh funds and the environment will get tougher as growth slows down in the Indian economy. What can startups do to ride out these difficult times. Suvir Sujan, co-founder and CEO of Nexus India Capital, a Mumbai-based venture capital firm that manages $320 million in funds, shares some tips. Sujan has been an entrepreneur who lived through and survived the difficult dotcom crash era (he co-founded and led online marketplace Baazee, now known as eBay India).

By Suvir Sujan

Ten Tips for startups to ride out the economic slowdown:

Don’t panic! Economic cycles are a part of life.  The best companies are built in the worst of times. If you panic, your employees will panic.
Conserve cash. Delay spending on non-critical things that do not result in revenue generation. Renegotiate vendor contracts, rental contracts, etc.
Improve productivity. Get more out of your team.

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