Business continuity during the time of COVID-19

The world is shaken by the virus. Economy and finance are taken by storm. Travellers all around the world are cancelling their flights. What is best to do for businesses in case of such an emergency? Previously known as coronavirus, the World Health Organization (WHO) has renamed it COVID-19 and declared the outbreak as a global public health emergency. It originated in China and followed by Japan, Singapore, South Korea, Thailand and now it has moved to the USA, Europe and Middle East. Very recently Saudi Arabia has announced that all the pilgrims to Mecca and Medina will be restricted access to the holy sites. A safe measure for one of the most visited sites in the world.

In Oman, the wise guidance of the leaders have presented a cautious scenario where risking the minimum is the keyword. The relatively small population of the sultanate, the large distance between conglomerates and perhaps even the healthy habits of the people of Oman are acting as a solid antibody for self defence. It is too early to consider it over, but certainly Oman is moving in the right direction.

In my country of birth, Italy, the emergency has been managed poorly from communication perspective and paranoia has emerged in the masses, showing first am atrocious wave of racism, followed by raids to the supermarkets.

Besides affecting daily life, this outbreak has also affected many businesses. A large number of both long and short-term effects have been anticipated and have begun materialising. Companies are forced to embrace Business Continuity Plans by splitting teams in different locations to avoid total paralysis in case of in-house spread. Many events have been postponed or cancelled. I was supposed to speak at 2 conferences this month, in Hong Kong and Macau. Both have been rescheduled in September. I am also supposed to speak in Dubai at the end of March, and for now everything is still confirmed.

On a larger scale, Telsa, the electric vehicle manufacturer founded by Even Elon Musk had its stock crashed by 19 per cent after the news of delay in deliveries in China of the Model 3.

The impact of the outbreak is more significant for technology companies and start-ups with a strong offline element in their business. For example People Matters, one of the largest HR events organisers, had to postpone its People Matters TechHR Singapore event. The CEO Ester Martinez explained that the company has been carefully monitoring the issue and had to make the difficult decision.

On the opposite side of the spectrum CoderSchool, a Vietnam-based coding school who had recently launched online-only programmes. The launch was perfectly timed (maybe by sheer luck) for the coronavirus outbreak and the enrolment was beyond expectations.

Depending on how many cases have been confirmed, each country has taken a different approach with the emergency and the day-to-day life. In Indonesia for instance, a country in excess of 260 million people, so far the number of confirmed cases is in single digit. There, business owners and start-ups are not as affected as in other countries with a larger number of confirmed cases of COVID-19. Caution is anyway advocated. The Indonesian version of Uber, GoJek, is encouraging all drivers to monitor body temperature and disinfect their vehicles regularly, while other companies such as DailySocial are not doing beyond what is commonly implemented.

Over the past week I have received invitations to attend a number of webinars to share and explain what to do in order to guarantee business continuity during the emergency. It turns out that all courses are heavily priced. Probably just another way to make money in a moment of crisis.

On the investment side, the case of SOSV is particularly significant. SOSV is a multi-stage venture capital group that conducts several world-class accelerator programs and provides seed, venture and growth stage follow-on funding into superstar companies.

According to Crunchbase, SOSV is the world’s second most active seed investor and third most active early-stage investor. Just a few weeks ago they closed an oversubscribed $277 million fund, the 4th one. SOSV has funded over 900 start-ups and currently funds over 150 start-ups per year mostly in Asia.

Investment reached a standstill as the Chinese government fought to contain the outbreak occurring in the winter season, the most quiet part of the year when it comes to venture capital investment. Back in 2003 SARS did not cause much damage to the Chinese economy, mostly because it was largely oriented on manufacturing. It was relatively easy to avoid losses by working harder. Now the main industries to feel the impact are trade, services and retail.