The pandemic has loomed over us for months now. As the world gets back to business, we thought who would be better than Southeast Asia’s leading entrepreneur-turned-VC, Peng T. Ong of Monk’s Hill Ventures, to shed light on how to prepare your startup for the “new normal”.

Key takeaways

The new normal is unlike anything we have seen before. Zoom is shooting through the roof while airlines are going bankrupt. There is not a lot of clarity on what the new normal is and how. We are in a very difficult environment due to a lack of predictability.
This is a long downturn, not a short one. In the short term, people try to optimise valuation but in the long run its more important to be alive and healthy.
Even what is doing well now, may slow down when the world goes back to being the way it was. So this is the time to make the most of acquiring consumers that you can work with later.
We don’t know what’s going to happen to the travel industry in the next few years, but at some point, there will be recovery and if you’re in the travel business focus on surviving the bend and you’ll be fine.
Any startup surviving this will end up being stronger. Like Google surviving dot com boom, FB surviving the great financial crisis (2008).
Pre-COVID-19 there was the idea that you can burn money and go higher (almost to the point of failure, sometimes). this trend was enabled by a few large funds who would try to take a startup public But now the investors are being more cautious.
Peng said he doesn’t see a big burgeoning of enterprise deals because the markets in SEA is very small for enterprises unless you also work globally or at least in China.
Singapore and Jakarta are the hotspots in SEA for startups to boom. Peng sees Jakarta slightly taking over Singapore. He added that Bangkok and Ho Chi Minh City look promising as well, since the economy in Vietnam is doing well even amidst COVID-19.
When it comes to e-commerce, the trend will look a bit like China. Economies of scale will make it hard for even governments to control monopolizing. But there will be a lot of specialised product sites with lesser market share.
Social e-commerce will be a saving grace for the SMEs selling online instead of selling via Amazon. Like Tokopedia in Indonesia is one of the big examples. The seller will become more like a micro brand with its own presence and identity.
There are two ways to fund your startup: investors or customers. If investor activity is low, you got to build real value and steer towards your customer.
This is a time when, if your business has no takers (e.g travel), it may be cheaper to hibernate and save runway then build up once the industry jumps back in.

Also Read: Be a rainmaker: The only advice Monk’s Hill Ventures’ managing partner wants to give us

Advice for founders

There is only one golden rule: Build a strong business!
Doing business is like fighting a war. If you are standing in the wrong place, you will be hit. There is such thing as the wrong place, the wrong time.
A pro forma statement will not be the same in 12 months in time. But as an investor, when I read it, I am trying to assess if the entrepreneur is logical in their projection.
A lot of founders fail to think about how and where the money/revenue comes from. They focus on how they will spend their investor money. So stray away from that.

Resources

You can catch the full video recording of the webinar here:

Food for thought

Will the carbon offsetting market an interesting sector now with health and environment taking center stage?

Plant-based and cultured meats are getting attention. Is there a greater future for this sector?

Coming up next

As pivot becomes the buzzword in a post-pandemic world, this webinar with PatSnap CEO and Founder, Jeffrey Tiong; decodes it for you and teaches you how pivoting your startup direction can help you hack growth. Register for our next webinar: How to pivot your growth strategy post COVID-19

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