By Lori Schafer, CEO PlumSlice
Business leaders often withhold the unvarnished truth for fear of market repercussions and for the appearance that they are in control when communicating to the outside world of stakeholders. In the turbulent time our world is in, I decided to take the risk of telling it like it is, from the perspective of a CEO of a high tech, young company. Why? In the hopes that it may help other business leaders with the choices they have to make. At this point in time, I can’t completely focus on selling and delivering software and services to all of our customers as many of them are furloughed or permanently laid off. What I can do is provide advice, and perhaps a confidential ear, to others fighting the same battles we are.
I became CEO of PlumSlice, a young and exciting technology company, in early January 2020. I left behind a long and fruitful career with a large corporation because I had a passion to go back to running a fast-paced, entrepreneurial company. Since then it’s been non-stop work on building the business and shaping the future of our solutions. Prior to the week of March 9th, 2020, our business was on a strong upward swing. Customers were happy. We were delivering on major projects and had built up a healthy pipeline. We had built a strong team and had a clear vision for our future.
Over the weekend, I’d just returned from visiting our India team/office and was ready to tackle the week ahead. There was a slight concern in world news about coronavirus, but nothing alarming. Flying home, I was disappointed reading that Shoptalk, an upcoming business conference in our industry, had postponed its late March event until September. I also found it a bit unnerving traveling back from India, via the Middle East, that practically everyone from other parts of the world were wearing surgical masks. However, landing in the U.S. felt perfectly normal. It still appeared to be life and business as usual.
It was Monday, March 9th. I had an upcoming board of directors’ meeting on Thursday and was putting the final touches on a detailed packet of information regarding growth of the business, strategy and all the financials and projections a board typically reviews. By Monday afternoon, the stock market seemed to be in a freefall over fears of what coronavirus could possibly do to the economy and by that evening, I was adding an addendum to my board packet stating that there was no longer clear line of site to our future as travel restrictions were being put down, major events and sales meetings were being cancelled.
By the end of that week, we were losing visibility to our sales pipeline as businesses began cutting back on all discretionary spending and one of our healthy prospects, who sold school supplies, suddenly had nowhere to ship orders as schools were closing nationwide. We had no idea what was about to hit, but as our customer base are primarily retailers and branded suppliers, I could see it was time for immediate cash scenario and contingency planning.
I remember telling our staff in India that we needed an immediate plan for them to work from home… just in case! India had not yet experienced any turbulence from the pandemic and is not a country with the infrastructure for employees to work from home. High speed internet connections and laptops are not the norm in Indian households and our large office was not designed to turn on a dime. My team’s first reaction was that my request wasn’t possible. They quickly figured it out though. Within the week, the Indian government put the entire nation on lockdown, literally one day after we got all of the procedures set up to have our team working from home. Had we not made the move when we did, we may have had a large part of our customer support and development teams unable to work.
Since that first week, there has been complete focus on the essentials of our company’s operation, little sleep and adjusting to living in world of constant “business triage”. Customers and employee needs are front and center, over communication has become our new normal and swift action on all fronts has become the daily routine. Each management team member was given three priorities, asked to focus only on those things and to do a similar real-life exercise with their own teams. In a world of uncertainty, cash is king, and it was also clear that little additional cash would be coming into our company in the near future. Extending our runway, as long as possible, became the immediate priority. And even in a crisis, innovation cannot be tossed to the side. We have a small group now dedicated to other solutions and go to market strategies outside of our ‘bread and butter’ business.
By the following week, our healthy sales pipeline had all but fallen off as all capital expenditures were put on hold and many of our customers pulled on-going and upcoming projects as they were planning layoffs and furloughs. I was suddenly making plenty of unpopular and unpleasant decisions to ensure that we would survive. As a follower of the philosophy of servant leadership, I believe in putting the team first and not laying off good people unless it’s the last possible resort. While we’ve managed not to lay anyone off, we all “took one for the team” in terms of significant salary reductions.
With the introduction of government SBA loans and the PPP (Payroll Protection Program) on the horizon, our CFO and I immediately shifted gears and began pouring through the ever-changing, complicated requirements and fine tuning our applications so that we were ready to apply the moment banks began accepting loan applications. On the Friday that all other banks started accepting applications, our bank, Wells Fargo, never even posted a link to apply and indicated it would not be ready until the following Monday. On Monday morning, it was apparent that Wells Fargo still had issues and we were at risk of being “shut out” of the entire process as millions of other business were getting their applications processed. We immediately began calling, and being rejected, by dozens of other banks until we found one that was willing to accept our application even though we weren’t already their customer. While the government and news media has made this program sound terrific from the top, the process has been several weeks of complete chaos and it required a number of advisors to help navigate a very complicated process. We are now waiting for the loan approval process to begin.
It’s April 9th, exactly one month since our little piece of the world stopped. I held a team meeting this morning and was fighting back tears because I’d just gotten word that a close family friend was put on a ventilator and three people from the family were hospitalized with serious complications from Covid-19, not being able to even see or speak to one another. But I regained composure after exposing my vulnerabilities for a few minutes. We talked through the state of our customers, our business and our team. Even across oceans and phone lines, we felt connected and ready to continue the fight. The majority of our customers have furloughed or laid off their staffs. Millions of retailers, as well as those serving other industries, are now unemployed and have it much worse than we do. (Note: the nation hit 10% unemployment today and it’s expected to climb to over 30% before this is all over.)
Sometimes. it is good to be lean and mean. We have an amazing team of which I am incredibly proud. Due to their swift actions, entrepreneurial team spirit, and relentless focus on our customers who are still moving forward, we are as well positioned as we possibly can be. I believe we will come out the other side of this shutdown as an even stronger and more resilient company. Will it be easy? No. Do we know what the future holds? No. Do we have any idea when we can begin to visit customers again and do our jobs away from our makeshift home offices? No. But we love our business, customers and employees, and we are an experienced and scrappy group of professionals who believe we have what it takes to weather even the most ominous storm. Will we survive and eventually thrive again as a business and as a cohesive team? Absolutely.
When many people are facing their own mortality, all of this talk about business seems rather trivial. I also realize that I am only one of thousands of CEOs working to save their companies. Every business leader is going through similar challenges. I am also far from an expert on navigating these unchartered waters, but I thought it may be helpful to be transparent and share our story. We are far from victory, but we are demonstrating how a team can pull together, support one another and pivot even in the most difficult times. Each day, I am hearing from customers and prospects who are now furloughed and in need of work. In the industries that we serve, we know a lot of people and we want to help. Whether a customer, prospect, partner, competitor or any other business, if there is some small way that we can assist others facing similar challenges, send me a confidential note. We would be humbled to do so. We are all in this together.