The startup industry saw enormous growth in the past year. While some grew their scale of operation, some garnered investments from across the world and some went the IPO route. All in all, 2021 was a boon for many startups. A recent report from Grant Thornton Bharat corroborated that, a total of $39 billion was raised by the Indian startup ecosystem in 2021 alone – a 255% growth from 2020.
Things however took a bit of a different turn in 2022. From funding winter to investor exits, several key issues held up growth for startups in 2022. As per reports in India Today, about 5,800 startups have dissolved since the start of 2022. But what are some of the reasons for this downfall:
1. Online-only models saw a decline as offline gained preference. As schools, offices, and malls opened and people started venturing out, the dependency on the online-only model was reduced. For example, many ed-tech startups with only an online presence had to close down their business in early 2022. Similarly, online-only delivery services too saw a decline in their services as local vendors and retailers started delivering their products for free.
2. Ineffective utilization of funds and resources. Sudden growth spurts resulted in manystartups incurring expenditures that they assumed would help them as their progress on their growth journey. This means hiring talent in anticipation, increasing market spending to remain relevant in the eyes of their stakeholders, etc.
3. Financial losses. As the trends and consumption habits of the consumer changed, many startups struggled to keep up with their projected revenue and ultimately suffered losses making it difficult for them to stay afloat.
While business acumen and a well-thought-out plan won the game for those startups who are still fighting the race to grow and expand, another important aspect came to the forefront—a well-thought-out communication strategy to stay relevant despite the changing landscape.
Over the years, communications strategy has expanded its ambit to include various aspects of the business. From traditional, digital, creative content, public affairs to crisis communication, businesses can take advantage of a bouquet of differentiated services, that touch multiple stakeholders and delivered as an integrated communication programme. It has become clear that big numbers and evaluations are not what sustainable growth is about. For that, one needs to align all stakeholders—investors, employees, customers, and partners—towards one’s vision.
As opposed to some 10-15 years ago, when our audience only consumed or got influenced by traditional newspaper articles, today’s audience has multiple consumption touchpoints, and therefore it’s prudent to ensure all our bases are covered.
In these turbulent times, a clear understanding and interpretation of the changing audience preference will hold a key towards who wins or who loses this startup race. An effective, focused and integrated communication strategy will help them address this aspect with ease. It will then help startups communicate with their audience in the way they prefer, on the platforms they prefer, with the message that would most impact them. A consistent effort covering all platforms with help them keep their audience engaged, understand and interpret their behaviours and preferences in time to be able to course correct in times of need.