Startups conserve cash to stay afloat

The startup ecosystem have been hit hard by the outbreak of the pandemic and are facing economic cut offs and downsizing. Business are taking hard look at high operational cost and dipping demand in an uncertain environment.

Startups are focusing on conserving cash and business runaway, so that the current income and cash remain constant.

So many companies such as Bounce, Drivezy, B2B unicorns and others have laid off its employees to conserve capital.

The stock markets of India have already been affected in the last few weeks, and now the private markets are facing the same fate.

Startups are facing disruption in their businesses with funding rounds getting delayed and consumption dipping. Many startups that received good funding in the last few months are focusing on lower cash burn instead of hyper-growth.

Many companies have also stopped hiring new employees for the time being. For most of the companies there will be a delay and it may require internal rounds, cutting burn to extend the runaway before the market normalizes.

The Founder of a top unicorn said that what India is witnessing today, China has been through over the last two months. Overall demand has been down by at least 30% in China, so it’s time for companies in India to act fast, revisit their priorities and tighten costs.

According to the analyst many countries that are already facing slow economic growth such as The United States, India, Europe, China will remain at least for two quarters.