Oceania’s startup scene is growing fast, and the region is quickly becoming a hub for innovation. Australia’s startup funding has recently tripled to over $10 billion, according to Folklore Ventures. And according to Startup Genome’s 2021 Global Startup Ecosystem Report, Sydney and Melbourne rank among the world’s top startup ecosystems. New Zealand is also seeing increased access to startup funding and was recently ranked as the world’s easiest place to do business, according to the World Bank.
But in recent months, some Oceanian startups have seen new challenges. Investor concerns and fluctuations in global markets have led to layoffs in the sector. While tech companies globally have grown 2.3 times more than their non-tech counterparts since the pandemic, there has already been a pullback in 2022 from the inflated valuations seen in 2021.
However, Sequoia Capital earlier this year mentioned, “This is not a time to panic. It is a time to pause and reassess.” Market fluctuations are challenging for founders and investors, but they can also represent an opportunity.
Zachary Nelson, former CEO of NetSuite and a current member of Freshworks’ Board of Directors, shares his experience of living through the “original dark period of the dotcom bust” in the late 1990s: “In retrospect, it was the best time to start a company. Sure, there wasn’t as much capital, but if you had started before the crash, you already had momentum, a product, a go-to-market plan. So you were way ahead of the other startups that probably weren’t born because of the crash.”
Resilience, a clear business plan, and strong leadership will help nascent startups survive and thrive in the current environment. Here’s what startup founders should do differently to keep their footing in the market and maintain business growth:
Adaptability is crucial in the current environment. Just as startups who were able to pivot rapidly in 2020 were able to survive the pandemic, knowing when and how to pivot can help businesses survive future challenges. In their recent “Adapting to Endure” presentation, Sequoia Capital shares a quote from Charles Darwin: “It is not the strongest of the species that survive, nor the most intelligent, but the ones most responsive to change.”
By some estimates, about 50% of the S&P 500 will be replaced over the next 10 years (and the average tenure on the list has been shrinking for decades). Today’s companies must be ready to continuously reinvent themselves to stay relevant.
It’s crucial to have a strong business plan and keep growth goals in mind, even when responding to market fluctuations. Zachary Nelson shares a mistake made during a previous market downturn: “Not hiring engineers as part of our hiring freeze. We fell a year or two behind on our product cycles of where we could have been.”
He adds, “I think it’s been proven that growing faster is always the cure in the SaaS market. That said, the market has changed now, and you see more shareholders and constituents demanding a clear path to profitability. But you have to balance the two things — growth and profitability.”
To stay on track with growth goals without overspending, startups must ensure product-market fit and create a streamlined marketing strategy tailored to the right target audience. Stacey Epstein, Chief Marketing Officer at Freshworks, names three key components of an effective startup marketing strategy: efficiency, confidence, and patience.
“When you’re growing fast, you can afford to do things in an inefficient way because it’s ‘growth at all costs’, but at a time like this, we have to use our data and metrics to really understand what’s working and what’s not. Then, we need the confidence to continue those things and not suddenly cut the marketing budget in half. And then, really, it’s just a matter of having the patience to see your strategy through.”
To maximize efficiency and minimize mistakes due to information gaps, companies must develop a data-driven strategy for marketing and sales. This means gaining more insights into customer needs and goals, as well as ensuring that sales and marketing departments are fully aligned.
It’s easy to get caught up in multiple different marketing strategies, but when facing a tough business environment, it’s important to keep things lean and focused. As Stacey Epstein puts it, “As marketers, you want to do everything — events, webinars, spend money on search marketing. But one should really understand what is delivering ROI. So when things don’t look great, that can be your moat, your differentiator.”
With Freshsales Suite, you can build a more streamlined, data-driven growth strategy. Your sales, support, and marketing teams will have access to a 360° view of your customers, AI-powered insights, and automation solutions to help you shorten your sales cycle.
It takes a startup to understand a startup. We’re passionate about helping our customers grow and get the most from their business, which is why we’ve created our Freshworks for Startups program.
When you sign up for Freshworks for Startups program, you’ll get:
Along with Freshsales Suite mentioned above, Freshworks offers a range of solutions for each stage of the startup’s journey – be it customer acquisition, engagement, or support.
We’ve worked with Australia and New Zealand businesses like AWM Electrical, Motorama Group, Total Synergy, University of Sydney, and Suncare Community Services, helping them grow and succeed.
To learn more about the Freshworks for Startups program, check out our program description and sign up today.
Freshworks for Startups is a #payitforward initiative by Freshworks to help startups with access to products, VC and investor connects, mentorship, resources, co-marketing, and much more. We work with Accel, Sequoia, Techstars, 500 Startups, Platzi, Brex, and several others to enable their portfolio companies and customers. Get up to $10,000 in credits across products purpose-built for IT, customer support, sales and marketing teams.
