How do you handle a crisis?

The Startup Help Desk

In this episode we answer questions about how to handle a crisis! There have been no shortage of crises recently, including the COVID pandemic and the recent banking crisis. We are here to help and in this episode we answer questions including:

• What, if anything, can I do to prepare for a crisis?
• How do we handle crises that are bigger than we are, like the recent banking crises?
• What do I tell my team if they are panicking during a crisis?

All of these questions were submitted by listeners just like you. You can submit questions for us to answer on our website https://www.thestartuphelpdesk.com/ or on Twitter @thestartuphd - we'd love to hear from you!
Episode Notes
Reminder: this is not legal advice or investment advice.
Q1: What, if anything, can I do to prepare for a crisis?
It is extremely difficult to predict when the next crisis will strike. The good news is that you can take action today to prepare. The best preparation is to build a healthy business (revenue coming from various sources and/or well managed runway) with:
- Clear ownership across the team for key responsibilities.
- A legal team already established and familiar with the needs of your business and industry.
- A regular cadence of communication with all team and direct reports.
Additionally, it can be hugely helpful to have your go-to advisors or other founders who have been in the trenches. When crisis strikes, you don't time to establish new relationships and friendships to learn how others are navigating a crisis. Instead, build your network of trusted advisors and fellow founders so that you can consistently learn from them and - in the moments of crisis - learn how they are addressing the crisis, too.
Q2: How do we handle crises that are bigger than we are, like the recent banking crises?
Make sure you survive. Assess what you control and what you don’t, and focus on on what you control.
In the midst of a crisis, you need to act and make decisions quickly. To do so:
- Sync with co-founders immediately.
- Seek guidance from advisors to learn what steps they are taking for their businesses.
- Proactively reach out to employees and customers.
- Get legal’s endorsement for the plan.
By communicating early and often, focusing on what you can control, and clearly defining your goal as "survival", you can get your startup to smoother tides.
Q3: What do I tell my team if they are panicking during a crisis?
They will panic; it would be strange if they didn’t!
1: Acknowledge the crisis and their concern.
2: Give them a plan to work towards. If you don’t have a plan, give them a plan to make a plan.
3: Be honest and transparent while staying calm and consistent. You are the anchor.
4: Give them a forum 1:1 to express concerns and listen.
Common pitfalls to avoid include:
- Yelling and screaming to create urgency. Instead, communicate urgency and set ambitious, shared goals.
- "Anyone not onboard with the plan needs to leave now." Instead, over-communicate the plan to help everyone understand the company's focus and how to get there.