COVID-19 Webinar Part 3: what is being done to help support businesses outside of accessing capital and how are founders being supported?

Paul Tselentis, Matthew Jones and Chris Trotter

In our recent COVID-19 webinar, panellists Paul Tselentis from 24Haymarket, Matthew Jones from Anthemis and Chris Trotter from Clarendon opened up about the impact the pandemic has had on their portfolio businesses and how they are managing that to help them survive.

In the third part of our COVID-19 webinar series, the panellists turn their attention to the measures they are putting in place, outside of accessing capital, to support their portfolio businesses at this difficult time.

While capital may be the primary concern for a lot of businesses right now, 24Haymarket has been putting an emphasis on making their portfolio businesses better businesses without being beholden to outside capital providers. Paul shares:

“We’ve spent a lot of time the last three weeks with the leaders of the respective businesses, be that chairmen or CEOs, going through leadership and crisis training, really working on how they communicate with their staff and how they communicate with their customers. The nature of how we are communicating is changing very quickly and the environment is a lot more volatile than it was two or three months ago.”

They are also adapting to business moving online, offering support as they get to grips with this new way of working, and encouraging their portfolio to take a step back and really think about their product roadmap and technology strategy.

“What we’re seeing now is that for typical enterprise facing companies to be successful in this environment, you’ve got to be able to engage with your clients on a virtual basis. That’s a very different toolkit than your typical enterprise sales guys are currently used to; visiting and doing in-person demos. It’s a great time for the product and technology teams to step back and think about their product roadmap and their technology strategy.”

At Anthemis, they’ve found that their portfolio requires much more coaching and an outlet to air their concerns and ideas. Explaining how they’re helping Matthew says:

“What we’re seeing now is that for typical enterprise facing companies to be successful in this environment, you’ve got to be able to engage with your clients on a virtual basis.”

“A lot of the companies that we’ve invested in, the founders just want someone to talk to. They want a sounding board around the plans that they’ve got, what they’re thinking of, how they’re approaching it and they want someone to ask them difficult questions about what they’re planning. That’s one thing that we’ve tried to contribute, whether it’s at nine o’clock at night or over the weekend. There’s certainly an increased level of dialogue about what’s happening.”

They’ve also set up weekly Zoom calls to share lessons learned, address immediate questions and chat through the issues the portfolio is facing.

Further emphasising the increased importance of communication during this time, Clarendon’s Chris Trotter explains:

“The communication aspect is so key right now. We overestimate sometimes just how much the management teams in our portfolio companies know about what’s going on. I think we probably underestimate the size of our own networks. In our portfolio we’ve got over 60 companies. We went through the triage process with all of them. We know what the risks are, we know where they can access funding, what the government schemes are, who’s been successful and who hasn’t. We’ve really just been trying to condense all that knowledge down to help the companies through this to understand what’s the best possible chance of succeeding with some of these government schemes. Sometimes our companies come up with quite innovative ways of securing additional capital. We’re just trying to share best practice across the portfolio.”

Switching their focus onto founders, the panel have been supporting their founders and preparing them for returning to normality, whenever that may happen. Talking about 24Haymarket’s approach Paul comments:

“The interesting thing that we’re playing around with in our mind is what does the restart look like? In some sense there’s actually an execution risk around the restart and what it means for different companies is going to be a lot more challenging than the lockdown. In a couple of months’ time you might find there are some sectors that are running on full steam. Some companies may go back to work and just find their customers aren’t there, their suppliers aren’t there and they waste a lot of capital. The restart is going to be more challenging from an operational execution point of view than the lockdown.”

Anthemis are being asked by their founders for information about when the lockdown will end and when they’ll be able to get back to business. It’s a question that doesn’t have an answer right now as Matthew explains:

“There’s no precedent for this kind of event. You end up in this scenario planning situation where you’re playing out different scenarios and what might happen, and attaching probabilities to them. There’s only so far that an academic exercise like that can really get you.”

Taking a different approach, Clarendon believe there may be opportunities for some founders during this time. Chris says that survival will be the key concern for founders who are struggling but if they’re in a strong financial position, he thinks that coming out of lockdown could be advantageous for them.

“There could be a lot of opportunities coming out of lockdown where they can get their hands on some really strong talents that worked for companies that haven’t been able to make it through. There could be some really good acquisition opportunities actually among smaller companies that have struggled through as well and just camped it out. We’re urging the companies that are well-capitalized to keep their eyes on good opportunities so that they can come out of the lockdown in a strong position.”

The series continues tomorrow with the final part where the panellists answer questions from webinar attendees and share their expertise and insight. Read part 1 and part 2 of our UKBAA Blog series.


By UKBAA27 Apr 2020