Risk in my Life

Risk in my life #1

An interview series by IRM India Affiliate that aims to assess the impact of a Black Swan event on different individuals and businesses. Answers as shared by the interviewees with IRM India Affiliate.

Armand Poonawala is the founder and CEO of @, a start-up he founded directly after graduating from NYU that aims to create a seamless way for businesses to meet their creative & marketing needs with quality assurance and affordability.

Q: As a firm which provides creative and marketing services with clients in the USA and across India, what kind of challenges have organisations in your sector faced?

A: It’s been a mixed response from the market for internet services which definitely leans to a slowdown overall. I think the worst is yet to come for the industry as a whole as cases rise in India. It first hit us that COVID was more serious than we thought when a long time customer from New York which had been with us for almost 2 years actually shut down permanently as they couldn’t bear losses associated with even a couple of months of a lockdown. Since we work largely on a monthly subscription model, customers that are bars or restaurants who have paused their services to their customer in turn have the ability to pause our service and restart when they’re operational again. Some of these customers have been subscribing to our service since 2017 and have paused for the first time and will resume once things clear up.  With internet consumption increasing in this phase however, there are many businesses that are looking to capitalize on this. We’re seeing many customers, some new and many old actually benefit from greater visibility now that people are stuck at home. For example, we had a customer that ended up selling 5-10 times normal amounts through our social media efforts as their customers were looking to stock up their product.

Overall though, less cash that businesses have, the tighter their budget is for marketing and creative services. So the industry has taken and will take a huge hit.

Q: Have you activated Plan B for your business and what are some of the steps you’re taking to minimise the impact of this disastrous crisis?

A: Actually, somehow we’re still on Plan A for our business. The reduction in marketing budgets is fully in sync with the fact that we’re about to launch our platform within the next couple of months that should disrupt the market as we know it for creative and marketing services. We’re about to be at least 3X more affordable with at least 3X better quality (for the price) than existing services out there, even for the Indian market. Basically, what UrbanClap did for households, we’re looking to do for businesses and starting with the creative and marketing space as we expand outside social media.

The key is to curate the best talent & quality control the process of delivery, doing all of this at scale through the help of data and software and then pass on the cost-savings to generate value for the customer. 

Since our platform is going to undercut the market as we know it and businesses have much smaller budgets, the disruption should in fact be quite positive for the company in the long run. Of course, there’s a short term hit which we’re embracing.

 

Q: What’s your advise and suggestion to peers in your sector?

A: I’d suggest that no one panics, embraces all outcomes and prepares for the worst. As start ups and fairly young companies, this is just another problem to solve among many others. We’ve got to just solve this one too to the best of our abilities and move on. How does one solve this?

  1. By taking bold action needed immediately, just as fast as Covid is hitting us
  2. Getting team members on the same page as to why cuts might have to be made as opposed to alienating them.
  3. Financially replanning for the worst case.
  4. Not getting too phased by this and just taking it in our stride.

The Institute of Risk Management is the world’s leading professional body for enterprise risk qualifications driving excellence since 30+ years across 143 countries.

Submitted By: Hersh Shah, SIRM

CEO at IRM [UK] – India Affiliate & India Chairman – IRM Regional Group

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