Stephen Allott is a venture partner at Seedcamp, a fund that has around 300 active portfolio companies.
As an engaged investment partner, when Covid first hit the UK, Seedcamp doubled down on assisting their companies with navigating the unprecedented uncertainty they faced. What they, and Stephen in particular, are particularly good at is scenario planning which – when done well – is about planning for uncertainty.
The silver lining for us is that in the talk, Stephen is sharing a new tool that you can use for planning out your response to unexpected scenarios.
The full talk and links to the original slide deck and transcript are below.
The purpose of scenario planning isnât prediction
It’s easy to think of “planning for the future” as an exercise in predicting what’s going to happen. But in practice it turns out that we’re generally pretty bad at forecasting what is exactly going to happen.
Scenario planning therefore focuses more on preparedness for different circumstances:
Scenario planning was invented by Shell, in the 50s, or the 60s and one of the things they started thinking through was the changes in oil price.
What they learned from scenario planning wasnât so much about getting the future accurately right.
But by thinking through the scenarios, and therefore being ready when the future happened to you, you were in a better position to react to it. The purpose of scenario planning isnât necessarily to make a prediction, itâs just to think through the options.
So, in the (likely) event that none of your identified circumstances come to pass, you will still be far better off for having gone through the process because many parts of your recovery plans can be easily adapted to whatever you’re actually going through. More importantly, you won’t be in a state of panic.
Access the Google Sheet used in this session.
More on this talk and Stephen
- Slides from Stephen’s talk
- Transcript below
- More from Stephen
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Transcript
Stephen Allott 00:16
So at Seedcamp weâve now got over 300 companies in the portfolio, and have you funded, probably something like 350 in total, but 300 still live. In the last week since the world change, weâve been calling around portfolio to see what we can do for them. I felt to work out what we could do for them, we need to know what their needs are. And for them to work out what their needs are, theyâve got to go through some kind of processes that deciding what it is that theyâre going to do now that the world has changed kind of thing. So thatâs how we ended up coming up with this scenario planning process. Now, I guess what weâll do is Iâll run through it and then we can throw it out into questions and people can use it as a guinea pig.
Mark Littlewood 04:10
And Iâd say itâs worth saying that seed camp by definition, most of the companies in the seedcamp portfolio have some sort of external investment, either from seedcamp itself or quite often from other investors who have either invested in seed camp to access some of those companies, or through those companies directly as a lot of them have come out and being viewed as being high growth, high potential companies. So some of the scenarios weâre going to look at here. I think today weâll be thinking about funded companies, but weâre also going to be thinking about companies that are self funded. And I think youâre gonna work through our magic spreadsheet. Our magic spreadsheet? I think your magic spreadsheets Stephen.
Stephen Allott 04:59
Something like that, so. So let me do a Yeah. So weâve, in the portfolio, weâve got everything from completely first startups, which have just had their money for the last month or two to large label corporations, and the most famous of which is UiPath, which has got 1000s of employees now. And massive unicorn market cap. So let me, let me tell you to the share my screen and take you to the take you to the questions weâre going to go through, decide what we do next using strategic scenario planning. So Mark, can you see that okay,
Mark Littlewood 05:42
I can see that, and I can see that everybody else can see that. And if youâre watching, feel free to type in the comments, channel, but you can see it too. You should see a spreadsheet that says introduction, what is happening?
Stephen Allott 05:59
And so youâll be asking yourself, what the hell is happening in the world? What are our options? So what exactly should we do with our discretionary spending in marketing or travel? Or headcount? We stop hiring or let a few people go leave it as it is, should we keep our office space? Working Capital, our payables? Should we delay paying our suppliers when receivables? Can we expecting our customers to pay their invoices? Do we have enough liquidity? And for many people, thatâs really the acid test? Can we get any more debt made any more equity? Whatâs gonna happen to our customers theyâre gonna carry on buying? Are they going to stop? Or are we going to find new ones? So overall, what do we do with our prospects, sales prospects, thatâs what that means. Are we trying to convert them into new sales.
Stephen Allott 06:53
So those are the questions on your mind. And scenario planning was invented by Shell, in the 50s, or the 60s. And they one of the things they started thinking through was the changes in oil price. What they learned from scenario planning isnât wasnât wasnât so much about getting the future accurately thinking through the scenarios, and therefore being ready when the future happened to you rolled along, you were in a better position to react to it. The purpose of scenario planning isnât necessarily to make a prediction, itâs just to think through the options.
So switching over to the sort of key assumptions. So thereâs a small number of very important variables in this crisis, the most important one from my conversations, has been the duration of the crisis, you can see that in the first row, there duration. Iâve got three columns, see in yellow, worse mid and best case against this variable of duration.
Letâs, letâs talk about that for good. So I think a week, even a week ago, people were saying it could be V shaped, we could be in and out in three months, thereâs a bit of bad stuff, and then they get back to normal business doesnât really change, you can see that thatâs pretty different from thinking, maybe 24 months, is really going to stop and itâs going to be completely different, or very different when we emerge from the whole crisis. On the other side, as soon as you ask yourself that question, what would we do in each of these three scenarios, youâre in a completely different ballgame.
Six months probably is not that different from three months. But you may have some more significant liquidity problems. 24 months, itâs really radically different the world, if capitalism is shut down for 24 months, in whole or in part, then the worldâs gonna be really different in your businesses as well. So just starting to have that conversation. opens your mind now. Last week, Iâve been putting out with great interest and anything and everything published on this question and devotion. And Iâll put a link in here. highlighted in blue, you can see the length of disruption is linked to the virus propagation rate. And then if many of you have read the report of Dominic Cummings,
Mark Littlewood 09:13
Steven,can I just button here? Because people canât click on that link as youâre sharing the screen. But I I think itâs the same spreadsheet that youâve shared with me. So am I Are you okay with me sharing those links in slack?
Stephen Allott 09:34
So what is the story on the on this duration? And the best view now is in this great medium article thatâs been published literally over the last couple of days, which explains that the Chinese have got it right. Theyâve actually worked out how to stop this thing in its tracks by unbelievably severe and precise sterilisation measures, they can go out, everyone gets sprayed and carefully disinfected. And that seems to work.
And then I found out this morning that the president of China, Xi Jinping, actually telephone president Macron last month to tell them how to solve the crisis. The French listened and have pretty much done it. The British as yet hasnât really done it. And this idea of herd immunity in that everyone get it and then weâre out of the out of the woods, I think that originated in a meeting, as reported in the Sunday Times yesterday. In Downing Street, you know that that idea has been junked. And one of the latest bits of work is from Imperial College, theyâve done some modelling, which is referred to in the medium article, which seems to think that will be locked down for a while. And then weâll know itâs blinking into the world and hope ti doesnât restart.
The assumption is that it will, it will restart. Thereâll be pulses of activity for up to the next two years.
Stephen Allott 11:09
Now I know what proportion the audience weâre already thinking in terms of a two year interruption in capitalism. But you can see that we were in a radically different place. Depending on which one we are. Working on the basis of planning for the worst and hoping for the best. making plans based on anything, our worst case scenario could get unhooked pretty quick. Now if you do have enough information changes in the next month or two. You can either start planning now and wait and see how it pans out for a month or two and then act or if you need to take prepared protective measures straightaway, you can.
Stephen Allott 11:54
But I think watching for information on the length of the duration is probably one of those crucial things for all businesses as we move forward into the crisis. Another thing thatâs become apparent from looking at the Chinese experience is the sheer infectiousness of this virus is nothing but really, really careful barrier protection that will protect us. I think you can think of it like an aerosol, itâs in the air outside, just by wandering around near anyone else you can breathe it in and get infected. Thatâs the duration assumption.
Stephen Allott 12:30
The next level down is customer demand. Firstly, bad debts. Are you going to be able to collect the money that the customer owes you or not? So companies in the travel industry, for example, selling to travel operators, airlines, hotels, and other businesses, they find that their customers just canât pay them.
So the worst case is 100% of your debts go bad. During an industry, which is to continue to trade, then you might be in the middle of best case and you can collect some of them. So done these days sales outstanding. Itâs an American term. I mean, how many months does it take your customers to pay you. So if youâre if youâre normally collecting on 30 days, people will systematically pay you later that may stretch out and 60 or 90, and in the worst case isnât going bad, you never collect it at all. What happens to demand?
So you could be like, as I say, in an industry like travel that just evaporates. demand goes to zero, we could see a significant reduction. Best case not much of an effect at all. Now this does vary radically by industry. Thereâs again, thereâs another link here where I can share to some material on what the prospects are for various industries.
Stephen Allott 14:03
Yeah, weâll go through the promising ones in a minute. In the first case study. 21 of the ones on top of the list is the governmentâs pharmaceuticals, healthcare, and anything to do with online technology, networking, all seems to be benefiting. So thatâs on the demand side, then on the supply disruption side, whatâs happening to your supply chain, and which includes your people. The best case people have already noticed that efficiency of people working from home is improving software development velocity, itâs actually better for people working from home. Iâve seen several data points on that. So there is some upside.
But if youâre getting parts and factories in northern Italy or in from China, your supply chain may cease completely become inefficient. So youâve got to consider your impacts of disruption in your supply chain. And thatâs capital markets. For anyone thatâs is a VC funded business has been expected to raise funds. The question is whether the capital markets will close to you or just become very hard, will they stay normal? thatâs going to affect when you want to start discussions with investors.
Thereâs also a proliferating range of government help government loan schemes, government schemes to support employees unless theyâre changing on the day. So thatâs all part of the capital structure. And all that scenarios, then play into whether you make any layoffs, which industries you go into, which industries you exit, you try and get started, except paycuts, compensation says a changing picture.
Mark Littlewood 16:05
What peopleâs thoughts are on what it would be ?
Stephen Allott 16:08
Discuss duration â Because thatâs the biggest variable?
Mark Littlewood 16:12
I not sure this is the Iâm not sure that anyone has a reasonable view; I think the real value here is to I think the plan for the worst and hope for the best is that it is a good approach. We could probably spend an hour talking about the different scenarios and looking at different different timings. But I think three, six, and 24 is a good, a good proxy for different different scenarios, donât you?
Stephen Allott 16:44
Yeah, no, it captures the range basically. Okay, well, well, letâs get letâs go into detail now. And see how youâve worked through this. So on imagine this is a small SAS software vendor. Itâs got 12 people. So how would they think about how they think about impacting these scenarios. The first thing you do is discuss them and decide which ones youâre going to make a plan based on. Basically, the the idea that so the next day is the green box to explore potential upsides. So I have other use cases with your tool, you still have money, vertical industries to win money, government, pharmaceuticals, ecommerce, telecoms. And there are actually plenty of opportunities out there.
Just an example government is really, really getting involved now in solving healthcare crisis and supplies, ventilators, the Request for Proposal going around ventilators. I got a email from a fellow colleague, I got an email from a manufacturer sent to the college asking for people to help them to design ventilators. Another creative idea I picked up is you can start to use a freemium model with your customers to build pipeline for when the industry returns when educational seminars to to build market awareness before business comes back.
And also sockets start to look for top talent and they become free onto the labour market as a result of this. So systematically, programmes to run need to get back to your customer base and be qualified that theyâre still going to be active. Using your tool getting value from it, you may have to read and prioritise some of your product features to fit into the new world. compared to the old.
It certainly needs to be qualify your sales pipeline, see if theyâre still going to be in a position to do business with you. Iâve been doing companies last week and getting quite a varied picture. Somebodyâs got complete spend freezes. Some itâs still indecision mode, and some definitely decided theyâre still in business because their demand is strong. But if you decide to extricate yourself from some commitments, so youâve booked conference space in the hotel in America or something, you may have to get yourself out of the contract somehow.
Mark Littlewood 19:23
Leave me out of it. Leave me out of it, you.
Stephen Allott 19:28
The so thatâs called resolving legacy issues.
Whatever you do you got to love your staff in the new world and the days been spent on that. You may find some potential upside or not. So how does that actually come into action? The starting point is liquidity. Cash youâve got in the bank today dates, January 2021. So two months time, fairly straightforward. And if theyâre going to go back to the market for funding, six months ahead of that is July 2020. Thatâs when they go today now. How does this what happens in the worst case, we still start with the same million in the bank, weâre going to cover plan, because weâve tried it heads and leaving for letâs move our cash out date to September 22, so we have to fundraise in March 22.
So thatâs the worst case theyâve got a survival plan, but itâs really involved then go a title, maybe funding from the government. In the best case, the burn rate goes down a lot, because we keep is only 17. Because it holds up. When weâve got 80% of our customers still doing business with us. Weâve kept 10 heads. In this scenario, weâre good to go till March 2025. So thatâs, that gives you a sense of how you can directly link trading conditions in headcount to your other cash.
Why donât we come down to this section here now? What should we do? In the worst case scenario with me, all our customers disappear for now. So engaging in programmes to protect current revenue, going to cooling them probably isnât worth it worth it. To me, no, no new revenue sources, weâve got a heads to lay off. Iâm going to close the office cuts, staff pay, money, public loans, and public assistance to be identified. If on the best case, though, weâre trying to protect our customer revenue.
Weâve identified some new revenue sources, so weâre only going to lay off two know stuff pay cuts, keep in the office, weâre not making any other customer introductions. Weâre still looking for garbage bags. Letâs work example for how a small chocolate stopper company in this fair amount of cash and a pretty solid business can work their way through.
Stephen Allott 22:26
Okay, so hereâs another completely different example, this is a 1000 person, enterprise software company. Theyâve got 100 million in the bank. But theyâre still not profitable, because theyâre going to be out of cash in March 2021.
Stephen Allott 23:14
So in the worst case, to get their cash out date to 2022 theyâre gonna have to layoff 600 people. Because the session, so essentially, theyâre bringing in no new money. This, this case here would be big enterprise software companies, a huge one, think of someone like Oracle and PeopleSoft, for the amount of new business theyâll be bringing in, pretty much stopped dead, theyâve got all their customer base, still alive, but big enterprise software purchases, capital spending are going to get put on hold by all their customers for at least some time, while they consume what theyâre gonna do.
Stephen Allott 24:00
In the best case, keep most of their revenue, theyâre not the burn is only net minus 1500. And thatâs taking them out to 2025. And theyâre only losing 100 of their 1000 employees. So you can see weâre linking this demand assumption up here was cut to 40% of what it was or 80% of what it was and that drives to cash.
Stephen Allott 24:35
The third example this is 100 person, comfortable software company. Now, the assumption here, the best case, they keep all their business, in case they lose a bit and then a disaster case they lose it all. And in the worst case, no business coming in monthly plans now 500k change, the 10 million bank account had let 40 heads ago, that only keeps them alive till 2021. Whereas in the best case, theyâre sitting pretty for quite some time. Now, thatâs, thatâs the basic principles.
Mark Littlewood 25:39
So thank you. I mean, I think no question that some of this is pretty sobering, sobering stuff. And I think we have a range of companies, some are profitable, are profitable enough to be able to kind of see through this, I think, again, this is something about looking at different, different scenarios and really kind of thinking, thinking them through.
So I know thereâs a few people have got some kind of questions around this. But I think this gives you a sense of some of the implications that businesses need to, to think not all of this is not all of this is kind of doom and gloom, I think that looking at your business, from this perspective, from this sort of perspective, is incredibly important. Because as we say, weâre looking at worst case scenario and hoping for, for better things, you and I work through what this means for our organisation as a worked example, last week, and if we carry on doing what weâre doing, itâs terrible news.
Actually thinking about what weâre doing and thinking about how we can kind of change and look at that early on. Itâs actually a different a different sort of position. And I think, you know, just being very open, very open about our business, a lot of it is very reliant on face to face interaction at conferences, one of the things that weâve been thinking a lot about over the years and never really done very much of his things like this things, things that are online, and I think there are lots of opportunities for us to actually kind of look at those parts of the market and really think about how we can, how we can deal with that.
Itâs a very, very different business and a very different business model. And having worked this through for you, I think, you know, I was very kind of cheered actually, that with, with the kind of resources that weâve got refocused in, in a slightly different way we, we could end up with something that is transformative for the business and potentially transformative for the community that weâre serving and that we work with. So yeah, my first my first kind of look at this was sh*t!
Stephen Allott 28:22
Lets just recall, the journey went through, because the first thing was, for three to six months, itâll just be a one off, itâs human back to normal. But if itâs 24 months, and possibly forever, and youâre thinking this is going to be a digital business, youâre gonna decommit from the physical commitments you had to make and start planning how you grow digital business. A week later, how far down that journey, are you?
Mark Littlewood 28:49
Well, we got something live. I donât know if itâs any good or not. Weâll find that at the end of these two days. Running it fully remotely. So yeah.
Stephen Allott 29:00
What kind of scenario Have you a week ago? Were you were you thinking it was a one off or permanent? Now? What are you thinking?
Mark Littlewood 29:10
So my expectation. I mean, very honestly, for the world is that we shouldnât expect. And I suppose going into this, I kind of have this thing in my mind. Weâre different; not a big conference; weâre not South by Southwest; not bringing 90,000 people into one town and taking it over for a week, what 234 â 100 people albeit from different parts of the world, itâs a different sort of scale of scale of things clearly in the short term. I think a lot of those things are changing and weâve been very, very open, you know, with with the people that weâre working with, that have we Iâve looked at a number of times conferences that have said, oh, weâre not running in April, weâre doing it in June, or weâre not doing it in June. Weâre doing it in September.
I think those are very, very dangerous commitments to make or ways to think about things. My working assumption here is that itâs certainly going to be a year before we do any kind of physical events on any sort of meaningful, full scale, we really donât know how things are planning, planning out, the good thing is we really know how to do the physical best of an event, where learning how to do the online piece, the virtual piece, the economics of those two things are very different. I think the people that weâve got, have shown that they can turn their hands to turn to both. And so that makes it No, it sort of puts us in a, in a in a good position. So if we focus on that, and we work on that for three months, and then things change.
Well, fantastic. Thatâs, thatâs, thatâs great news, I think weâve got a stronger, more successful business that that comes out of that. If it doesnât, it means that weâve started to plan early enough. But I think that itâs itâs not, itâs not all about me. I think everybody in the world, you know, you canât help seeing the world through your own your own particular lens. And I think weâve got a few, a few few kind of questions that are coming in, if anyoneâs got questions, either by putting their names to things, or, you know, anonymously, very happy to pick them up.
So weâve got one here:
As a business to business, whatâs the most effective way to build net new relationships with target end users and sponsors without the risk of being left only cold calling them in current scenarios?
So usually, we build new relationships through presentations and reference-able introductions at conferences, Iâm sorry people, weâll be there online for you, at least!
Stephen Allott 32:20
the question is how to do lead gen in a non physical world. So the basics are starting, but when youâre going to be marketing, lead or sales lead, as the first choice for lead gen, it has to cover the basics. Marketing lead means you taking advice on TV or in public stuff, when people contact you. Sales lead means you, you identify people who could be prospective buyers, you contact them.
And thereâs a thereâs a handy framework that Iâve set out in one of my blogs, which helps you choose between one and the other. The basic type, itâs if itâs an airlift to people, and itâs youâve got to explain to them what your thing does. And, and you can actually get hold of their contact details and sales lead is probably a good way to go. If youâre just telling them your stuff, you canât reach them very easily. Theyâre like software developers or something, maybe marketing will be a better way to go. So the first thing you do is decide your marketing mix. Everyone knows how to do digital digital marketing really well. So Iâm not going to cover that. But the thing thatâs less well known is how to do what I call rifle shot sales. Sometimes itâs called targeted outreach.
The basic concept if you are selling to the top 20 law firms in London, you can easily get a list of them. Then you can go on LinkedIn and find the names of the IIT buyers or wherever the job title you want to talk to is. You can go the list of the people you want to speak to. And then you contact them with a personalised communication, not cut and paste. Find out some personal detail about the individual fee. Weâre trying to reach Mark Littlewood. You talk about Littlewoods law and his history of being descended from great mathematicians or something like that. You put in some personal detail youâve discovered your LinkedIn message or email or something to try and get them to respond. And then what you do is you donât sell to them.
Thatâs a great trick, called the call to action is not sales, education, youâre going to teach them something or help them learn something new. In the physical world, this used to be a business breakfast, some kind of roundtable with weâre going to customer case study preference we used to do in the virtual world, weâre gonna have to do an online sem rush or short sale to educate people is a great way of building your pipeline. A slight variant of it is personalised advertising, which people call account based marketing. So you can buy ads on Facebook for example, just to appear in front of Mark Littlewood by name You can reinforce your email campaign with me make ads pop up in front of them at the right time of day,
Mark Littlewood 35:06
you could buy them but youâd say be wasting your money because I donât use Facebook or when I go on Facebook, on the odd occasion, I have an ad blocker in as well. So yeah, no, definitely donât do that if you think thatâs the way to, but at no point take it.
Stephen Allott 35:24
Thatâs thatâs the kind of rudimentary sales lead lead gen. In the non physical world now, I think for many people, whether youâre Atlassian software, red gate software, thatâs been your thatâs the first 10 years of your life with like that. Whether itâs marketing lead, or sales lead, you didnât do in person stuff. It was just so good. They sold themselves. So getting used to the new digital world, itâs really great thing, whether the welcome back or not learning how to do digital legions really, really valuable?
Mark Littlewood 36:01
So this is another interesting question. And maybe, can I share one of the things that youâve shared, which Iâve shared in Yeah, or I think Iâll just take over Oh, yeah, please stop sharing. So question is, what are the what sectors do you see as the big opportunities during this time and this is a sheet which is looking at the impact impact of COVID on European tech and split things out or different? Or looks at a number of kind of changes that are going on and different impacts on on tech companies? So have you got any sort of comments on
Stephen Allott 36:56
Yeah, so high level we already talked about in that scenario planning things that are hot are hoping that doesnât digital meetings. Weâve invested in this company called hoppin takes a little guidance online.
Government is really hard. Itâs spending to keep the economy afloat theyâre spending to rebuild the country theyâre basically taking over running the worldâs economy the government is red hot pharmaceuticals in certain spots, healthcare, technology and telecoms. Digital well some of the obvious hot sectors and then in this in this chart These are some of the red itâs an opportunity in so many bad and green is an opportunity if your hotel stays hotels are in trouble offices Iâm not sure whatâs going to happen to office space actually in the property market will decide that working from home and the way weâre gonna go whoâs gonna weâre gonna go back in the office anymore cars actually the car production in your closed down now I read Volkswagen flawed, I know this and Iâm assuming the US car manufacturing stopped.
Stephen Allott 38:21
So regarding travel, if you slide down a bit more so hospitality is third biggest economy industry in the UK employs over 3 million people
Stephen Allott 38:39
are going to be going out and going to be cooking at home. So often things to do with stay at home and buying better food or to think grocery stuff like that.
Stephen Allott 38:58
The slide down some more health care people get sick and die. So this sheet is very much about being more in the sort of individual behaviour rather than bigger macro changes. I can I can both see though, people beginning to get worried about more green things like destruction of natural habitat so that one of the theories why the Coronavirus actually is nice is itâs about virus from China. Because weâve been storing the natural habitat itâs sort of the house preventing destruction the natural habitat of wild animals could be one of the causes of this kind of endemic danger.
Mark Littlewood 39:54
Okay, so weâve got some some other questions just as a note, if you can put questions into the q&a box, which is at the bottom of the screen, rather than in the comments is easier to track. But Iâm going to take this from Andy an audience, for online lead lead for online lead generation
how do you deal with the sensitivities these days, even with case studies, people see through it and say, Now is not the time for this.
So, I mean, maybe there are two things here, I think these days â unless anybody thinks very differently, I feel very badly of companies that are sending me all sorts of outreach, outbound email, dressing themselves up as the solution to all sorts of problems that theyâre imagining that I have, quite often when those companies actually donât have a solution to offer.
I mean, clearly, as an event organisation, Iâm being bombarded by essentially very, very basic event, ticketing companies spamming me with offers of their virtual event solution, which is a lot less thought through than just having a Zoom Room, for example. So I think there are there is that sort of thing about, you know, being very careful in that in the short term, and I donât know if you or anyone whoâs whoâs whoâs listening in has got any thoughts on on that. And clearly, companies are under pressure to deliver and to perform. So you donât really want to stop your business development activities. But youâve got to be kind of super sensitive. And then what happens is, as we work through this,
Stephen Allott 41:50
Just a couple of comments. I totally understand that being spammed to death by people trying to drive business, that sad. And the government just 11 oâclock this morning published a notice saying theyâre having an innovation competition for people to solve and COVID process. So theyâre actually inviting you to get involved and see what you can do.
And then a friend of mines company, and a few weeks ago, we organised a breakfast seminar on how to do particular thing that they do. And the 32 people we invited 31 showed up, because they wanted to learn how some of the leaders in the industry were using the tool. So this is effective demand. And I spent the last three years in AI, organising seminars on latest trends in AI, and weâve had hundreds of people turn up because they want to be educated. I think, key thing is education, education, education, what the marketplace wants something new.
Mark Littlewood 42:48
Yeah. With a caveat that that is genuine education and I think people really need to have to be very, very brutal and very, very frank with themselves about whether what theyâre putting in someoneâs inbox is of genuine value, or whether itâs some bullshit white paper spun to sell some solution that they, they just want to want to sell. I think, you know, itâs remarkable how some companies can do the education piece incredibly effectively. Others are just really, really bad at it. And you just say spamming you because spamming you. So really thinking through, youâre gonna find out pretty quick. Yeah,
Stephen Allott 43:42
youâll find out very quickly, maybe within 30 minutes when they donât join now, selling within 24 hours and whether itâs working so natural selection will take care of the ones that donât ask. I saw a question question got from Gareth Marlowe. GDPR effect, targeted outreach. And I spent a long time looking at the GDPR recently. So I donât think it does really at all. Thereâs many, many sources of public information, but not least of which LinkedIn about people. So you can get the information and use that to contact them. If thereâs something I missed about GDPR on that, let me know. But the I donât think GDPR per se is a particular problem on that.
Mark Littlewood 44:29
I think I think, buying lists and using them as mailing lists, and thereâs a whole bunch of things that are obviously obviously, not within the within the letter or the spirit of something like GDPR and I think you know, becomes sort of increasingly obvious when companies do now. Can you talk about some of the companies in I mean, youâve got almost 300 companies in the C camp portfolio without necessarily naming names, although itâs always more interesting if you can make names. Can you tell us some of the some of the types of things that some of those companies are doing to change the way that they they think about strategy
Stephen Allott 45:17
in this and then imagine the crisis. So the first one I want to tell you about is Tuttleâs. What theyâre doing is very public. Every business that collects and sells information about where to find public tenders, itâs in a category called sales enablement; getting information about business the government wants to stuff the government wants to buy. So theyâve set up a web page for notices about procurement about COVID. So across the whole of the European Union, if you want to if youâve got something you think a government could buy, that could help sell because the prices prices, you can go to their page someday who daily and theyâre collecting together all the stuff including this billion pounds, it contractor organised food delivery, that the Cabinet Office and published last week.
Mark Littlewood 46:13
So thatâs a billion pounds for food delivery
Stephen Allott 46:16
for the IT system to organise food delivery.
Mark Littlewood 46:22
Interesting,
Stephen Allott 46:23
startles governments is a massively important market now for us authority. They could buy them, ventilators or cures the vaccine, or whatever. And any companies is wondering, can we Is this something weâre selling to our existing industries? Can we sell the government now? Where do we find out about what government businesses available? Stuff a great place to go. So thatâs a pretty massive adjustment without making
Mark Littlewood 46:58
any others.
Stephen Allott 47:01
So as I mentioned earlier, weâve got this investment in accounting and hoping that those digital meetings which is turned into the biggest rocket ship, you can possibly imagine track to the frenzy of interest in other investments, so theyâre already in the right place.
Mark Littlewood 47:23
Okay, and any, in any in some of the more the more at risk sectors, what whatâs the sort of what are the what are the moves? What are the what are the areas, some of these repositioning are some of them? I mean, how do you how do you reposition?
Stephen Allott 47:45
So Iâm talking about a couple of sectors, legal tech is one in tech is another. Theyâre both big sectors in the London market. So both of them are quite big legal texts, probably the easiest one to explain. So if youâre a lawyer, legal, legal firm customer base, in Texas that benefit at this stage of the cycle of an insolvency, litigation, insurance, maybe people related issues that are okay.
But if theyâre if theyâre doing m&a, equity, capital markets, big deals property, although sectors have fairly bombed out and just a property as an example, thatâs a huge driver of legal business. So property has its own property cycle, which I think lasts about 20 years, normally, this crisis is going to kind of precipitate a new property recession or not. So you can look at your customer base and, and see work out if theyâre at risk from understanding some of the underlying drivers of demand.
FinTech is, is very nuanced. And I think itâs going to be very hard to tell which bits and FinTech are going to do well on which bit are not independent, because because when you decompose it in different financial institutions in FinTech, when the clearing banks, investment banks, also market intermediaries, theyâre going to keep going on, theyâre gonna put a big pause on how I can imagine the big clearing banks could be pretty slow to react. Some of them will medium size institutions will put a spin freeze on pricing, some of this smaller, more general purpose banks.
And then thereâs new payment methods monzo, revolut, transferwise, all these sorts of things. One of the big questions is whatâs the future of open banking; is innovation in open banking going to carry on was going to be put on hold or be pulled by the current crisis? That is not visible to me at the moment, and I think people will be working out right now. Theyâre going through their sales pipelines.
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