StarVest Portfolio Companies Reacting To COVID-19

Microsoft founder Bill Gates offers his outlook on COVID-19 pandemic and economic consequences.

Apple & Google Announce Joint Contact Tracing Initiative 

McKinsey’s The Restart: Eight actions CEOs can take to ensure a safe and successful relaunch of economic activity.

McKinsey & Company presentation featuring Deborah Farrington: Value Creation and Transformation in Advanced Industries.

Here is one of the best things we have seen on managing in the crisis: a McKinsey presentation via Zoom for Fortune 500 CEOs and board members earlier this week. It provides tools for  scenario planning (starting on pg 11 – showing scenarios for economic impact. It  also suggests having a “Plan Ahead” team – in addition to the “Crisis Management ” Team.

Key take-aways:

• Must think in both Crisis Mode and Plan Ahead Mode (to be ready for the upturn and provides hope)
• Need a laser focus on:  Employees/ Customers/Cash

• Employees (their health and continued support and employment)
• Customers (how can we help them be ready for the upturn and show support and understanding during this time). Idea: one SaaS company offered when requested a 90 days deferral, adding that pro rat to the remaining 9 months. Constant communication with customers so they know “we are here for you”
• Cash (cover expenses, especially staff and the maintenance of the year). Many companies have drawn on their lines, consider a “cash war room”.
• Leadership: Speed of action, Explicit sacrifice (CEO /others suspend own pay for 3-6 mos; makes HC cuts/other measures more understandable for employees), Frequent Communication, Scenario planning, Look ahead/near term forecast: next 7 days and next 30 days and next 3 months/ 6 months (one company has a 7 day and 30 day outlook that it publishes every day!).

What resonated most from the deck:

• Recovery scenarios starting on pg 11
• The 5 Rs on pg 17 – a good way to think of how the crisis will play out and how it can be utilized to effect change and better position companies for the future:
• Resolve
• Resilience
• Return
• Reimagination
• Reform

Former Google Chairman Eric Schmidt Offers Technological Outlook on Economic Club of New York Virtual Event.

Key takeaways:

•  We need money spent on this Pandemic science and data problem to figure-out the go-forward strategy.
• Governors have a difficult challenge needing data to assess tradeoffs especially when to re-open schools.  Would hire top 50 top scientists in each state to help tackle modeling on a local level.
• We are in the midst of a massive experiment in telemedicine (greatly aided by reimbursement changes esp including in mental health), remote education and shopping. Further clarifies the need for digital retraining and re-skilling.
• Need to invest in 5G to remain globally competitive. National emergency.
• Huge global humanitarian crisis in the works. US still has the opportunity to leverage our capabilities to lead developing nations in how to proceed out of this.
• Governors are going to have to start getting as much data as possible through modeling to make tough decisions on what to re-open first.
• Highly concerned about this moving into a solvency crisis.  Keeping closed down for 1-2 months is not a viable option.