Post-COVID Survival in TMT Sectors

Disruptive thinking is required to make the hard decisions necessary to emerge agile, resilient and relevant in a post COVI-19 marketplace. While each TMT sub-sector has unique challenges, these approaches are built from innovative application of time-tested solutions.

Are you ready... to re-start your sales organization?

"Amazing quote goes here...." -Managing Director, Luca Ridolfi

Multiple characteristics are feeding disruptive thinking during COVID-19 for a $3B company with software, services, and marketplace revenue lines.

  • A substantial pause in client activity, led to a corresponding pause in sales rep activity
  • Existence of outliers in multi-year client gross margin and contribution margin by rep
  • A high-touch sales model, with handoffs across outside sales, inside sales and customer success/account management teams

Re-start: A phased approach to a disruptive-restart in the Sales organization

Phase 1: activate 50% of the original cost base to deliver 75% of original revenue

Phase 2: Activate 60-70% of original cost base to deliver 110% of original value

Are you ready... to operate with 50% fewer sellers in the field?

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Are you ready... to pivot to a 100% virtual customer engagement?

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profitability

Are you ready…to de-risk your balance sheet?

Know the risks inherent in your balance sheet

Disruption caused by COVID-19 for a $1B e-retail company with a tidal wave of cancelled transactions and significant marketplace counterparty risk

  • Immediate and significant revenue drop-off to near-zero leading to substantially negative operating margins due to fixed cost base
  • Heavy focus on driving growth and market share led to hidden balance sheet risks around working capital in the event of an exogenous shock
  • Severe liquidity crunch created by combination of steep revenue decline, sticky cost base, and working capital obligations

Know the risks inherent in your balance sheet

Disruption caused by COVID-19 for a $1B e-retail company with a tidal wave of cancelled transactions and significant marketplace counterparty risk

  • Immediate and significant revenue drop-off to near-zero leading to substantially negative operating margins due to fixed cost base
  • Heavy focus on driving growth and market share led to hidden balance sheet risks around working capital in the event of an exogenous shock
  • Severe liquidity crunch created by combination of steep revenue decline, sticky cost base, and working capital obligations

Solution:  Immediate shift in priorities from growth to cash management

Monthly opex burn reduced by ~70%

Negotiated delays in large cash payments from Q2 to Q3/Q4