Rainbows As A Service

5 Steps To Identify Opportunity Amid Severe Uncertainty

During our recent webinar, Founders Leading Through COVID19, David Burt and I talked about finding the rainbow in the storm clouds.

The rainbow reference refers to opportunity. It makes sense to look for rainbows if you can spare the mindshare to look for them. But many can’t.

Entrepreneurs, especially at seed and Series A stage, who are preoccupied with making sense of future scenarios, are being advised to put their companies into survival mode. This is primarily due to shrinking capital markets. Investors are keeping their powder dry, being more selective about the companies they back or redirecting capital to support the survival of their existing portfolio companies.

Meanwhile, the fight or flight response, which was already overactive in entrepreneurs as we fought to grow in pre-COVID-19 conditions, is being dialled up to new highs.

While this built-in survival response is essential, it comes with one significant drawback. It narrows one’s aperture to consider opportunities. In other words, the focus on staying alive is traded off against an opportunity that may be hiding in plain sight.

This blog post is not about how founders and business owners should work harder to identify opportunities.

My message is to get help to identify the rainbows while you keep focused on your companies survival.

What I’m about to describe is a battle-tested process that I’ve been using for years. The schism that the world is embroiled in will result in businesses thriving, pivoting or closing. My motive is to alleviate stress, reacquaint you with a growth mindset and help you avoid the latter.

5 Steps To Identify Rainbows

These five steps are simple to read and implement, but there’s a reasonable chance that the second step will be the sticking point.

1. Seeking perspective as quickly as possible

And you don’t need to look far for a good dose of it. The future is uncertain, cabin fever might be setting in, and all that you’ve worked for could be on the line.

I could throw you any number of examples about why life isn’t as bad as you think, but I’ll leave you with this; you’re not Rose Schindler aged 14 about to enter a World War II concentration camp in Auschwitz, Poland.

After much deliberation, I decided to use this example after listening to Rose’s story on 5 March. It is a painfully sad story but one that provides the clear reminder that thankfully, nothing like what Rose experienced is facing us. Today or tomorrow.

2. Suspend pride and ego in favour of listening

Pride and ego are double-edged swords. They are required in high volumes to start something new, to screen out the critics and naysayers and to persevere when showing up and hustling is 95% of the game.

But today’s game is different.

Entrepreneurs and business owners are known to be highly adaptive, at least up to a point. That point is where the fundamentals of their business model, or their ‘why’, gets challenged. It’s also at that point where pride and ego fall in value and become agility killers, mainly on account of reducing the ability to listen and learn.

Today, preserving and showing up will take you 50% of the way. Permitting yourself to say ‘I don’t have the answers’ and then listening to what comes next is where the game will be won or lost.

3. Recruit seasoned entrepreneurs

These are not business coaches, accountants or lawyers. They are people who have started, sold or failed and started companies again. You might know them or not. They might be from your industry or not.

The point is that we have an ‘earned empathy’ for daily uncertainty. We get it, and there’s a double force multiplier in this experience.

First, because we’ve seen more of it, we’re not only quick to identify rainbows and weak assumptions, tips on how to implement the rainbows come as part of the advice.

Second, most serial entrepreneurs possess an inherent ‘pay it forward’ mindset which predisposes them to help. It also grants them a short reprieve from leading their business (and a change is as good as a holiday).

Bring two or three serial entrepreneurs together on a Zoom call to talk through options. I’m not saying that every entrepreneur you’d like to talk to will say yes, but if you don’t ask…

And if you don’t have a direct line to the entrepreneurs you want on that call, turn to LinkedIn and Twitter.

4. Pitch your company and pivots already under consideration

As entrepreneurs, we know our business proposition inside out. Or at least we think we do. This step is about providing a 10–15 minute explanation about the business during a 60-minute Zoom call with the entrepreneurs you have recruited.

As part of your pitch, it is critical to include:

• Today’s customer experience (to help newcomers internalise the value proposition and business model)
• Pivots already under consideration
• Cash in the bank (this will help inform the ideas that the entrepreneurs present to you)
• Measures being taken to survive and the runway that these measures will buy the company

The mutually agreed rules of engagement for this call should include the Chatham House rule. By the way, it’s highly unlikely that people will sign a non-disclosure agreement to help you, so don’t ask. Instead, refer to but don’t share confidential information.

I also suggest asking permission to record but not share the Zoom call. This will help you be present on the call instead of trying to think, respond and take notes simultaneously.

5. Listen

Much like step two, this step can be difficult because business owners are used to doing the talking.

When I’m listening in this kind of forum, I pay particular attention to the questions that challenge my assumptions. The intent behind these questions is often to help me see the weakness in those assumptions.

Pro Tip: When asked a question, respond authentically. Avoid falling into sales mode and returning with a quick comment as if to overcome an objection.

Just listen, knowing these people are there to help.

Teaming on Rainbows

While the buck stops with the CEO, it’s not on you as an entrepreneur or business owner to single-handedly conceive and deliver on each potential opportunity.

Whether you bring your team into the tent on rainbow identification (which I strongly encourage) or present them with ideas using the model above, ask them to comment on the pros and cons of each opportunity. This adds another valuable dimension to the pivot surface area and helps the team to internalise and own the path forward.

One last thing…

I’ve brought seasoned business-builders together to help me think about my business and for companies where I am a shareholder. I encourage you to do the same for your business or for business owners you know.

Startup hubs, universities and accelerators can also offer this short-form collaboration as a service. It might lack a long-term financial model, but value is often created in new ways during a crisis.

Originally published at https://philhsc.com on April 12, 2020.