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Crisis Survival Kit: 5 Ways To Focus On Business Fundamentals

Even in the best of times, the deck is stacked against small and midsize businesses -- fewer resources, less access to capital, and little or no brand awareness. That's why strong fundamentals are so essential to business owners in smaller organizations.
Even in the best of times, the deck is stacked against small and midsize businesses -- fewer resources, less access to capital, and little or no brand awareness. That's why strong fundamentals are so essential to business owners in smaller organizations.Sequoia Capital's now infamous "RIP" PowerPoint deck focused specifically on the tough sledding that lies ahead for venture capitalists and the start-ups and entrepreneurs that depend on VC money. In a recent post on GigaOM (that was also picked up by the New York Times), Bryan Roberts, the managing general partner of Venrock, takes the Sequoia RIP deck as a jumping off point to lay out five things that he believes every entrepreneur -- and by inference -- business owners should be doing right now (and keep doing in good times):

  1. Reaffirm the value-creating milestones for your business.
  2. Focus your capital on hitting them in the most efficient way possible.
  3. Ensure that your current cash is safe. Is it invested in stable corporate bonds (like GE)? Or is it sitting in financial institutions, even the finance arms of manufacturing companies (like GMAC)? Are your lenders likely to deliver money they have agreed to lend? Do your investors have reserves for future rounds?
  4. Look at your burn rate to make sure current expense rates still make sense. This has more urgency for later-stage companies that are selling a product, but those in R&D mode should always be thrifty.
  5. Lead. Reaffirm the viability and vision of your company to the troops. This will counterbalance people's tendencies to worry about their jobs and dreams, even decrease the time spent watching stock tickers.

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