KEY INSIGHTS:

1. The pandemic has split startups into three categories

• Directly impacted by COVID-19 (travel, hospitality, food companies).
• Indirectly impacted by COVID-19, with modest slowdown (SaaS startups).
• Positively impacted by COVID-19, with drastic revenue growth (health tech, eCommerce, online education).

• The 1^st category founders should acknowledge the challenging situation to control their narrative and articulate how they are going to pivot by changing, for example, their business model or adjusting to new market demand.
• The 2^nd category founders should demonstrate some discipline and present their plan for the next 24 months instead of the usual 18-month period.
• The 3^rd bucket founders should convince VCs that their business dynamic is sustainable or explain how they are planning to use the momentum to achieve other goals.

• The startup teams that would like to pivot should balance between offense and defense not to miss great business opportunities that usually come up during any crisis. But at the same time, they need to avoid unnecessary risks to save capital.

• The pandemic has made investors risk-averse, so they are looking for startups with high-quality teams and top-notch ideas.
• It’s clear now that a traditional venture capital investment calendar doesn’t work this year. Although the business is reviving gradually, it’s still unclear what to expect in January.