The COVID-19 pandemic has hit the startup ecosystem like never before. The aviation and hospitality sectors are facing a mammoth crisis, and even the future looks bleak with no idea on when to expect a revival. After all, it’s not a demand-supply mismatch, but a public health emergency where human lives are at stake and mostly nobody is ready to take a chance.
International borders have been sealed with strict restrictions on non-essential travel. Economies have been entirely shut down to curb the spread of the pandemic. Businesses operating with thin margins and negligible cash in hand have either closed down or are at the brink of closure. Millions of jobs have already been lost, and the world is staring at an uncertain future.
Amidst all this, there is hope that we will emerge out stronger and be much better prepared for such situations in the future. Governments and industries around the world were not at all prepared for this situation, and it is high time that everyone has contingency plans. It is not the first time that something of this sort has happened, and neither this will be the last time.
AsiaTechDaily recently interviewed Vikram Bharati, Founder, Draper Startup House especially focussed on the impact of COVID-19.
Vikram Bharati is the founder of Draper Startup House (International). Draper Startup House is a global chain of hostels targeted for young startups and entrepreneurs. They aim to provide affordable yet soulful hostel accommodation in the heart of every major city in the world. It is a space to explore and engage with likeminded people who are on the same entrepreneurial journey. Their mission is to enable ONE MILLION entrepreneurs worldwide by 2030.
What are your views on the impact of the coronavirus pandemic on the industry you operate in?
Vikram Bharati: In the short term, this COVID-19 pandemic is clearly having devastating consequences for most businesses in the world, including the hospitality and travel industry. But in the long term, this pandemic is going to be seen as a blessing in disguise.
This was a wake-up call for the whole world. Why were we not prepared for such an event? Maybe we all became too complacent because we had a long streak where things were going so well. We should have been prepared for this. I guess it’s easy to point fingers and blame everyone else. But the truth is that we are all individually responsible for our own businesses and we should have been prepared for such an event. It’s easy to say that this was a “black swan” event and nobody saw it coming. The truth is that this was not a “black swan” event. This was a “white swan” event. Scientists have been warning us about events like this for a long time. We just decided not to take them seriously because it was not convenient to do so. We became complacent, fat and lazy because things were going so well for such a long time.
It was shocking to find out that large corporations didn’t have enough capital allocated on their balance sheets to operate for more than a few months in such an event! I can understand why small, mom and pop companies wouldn’t have enough capital cushion for an event like this. But large, publicly traded companies? They should have been prepared for this.
This pandemic is going to make every industry more prudent. So in the long term, this pandemic will make our industry better off. Hopefully, we will be prepared for these types of events because they are going to happen again.
How has the COVID-19 situation impacted your business in particular?
Vikram Bharati: It has been devastating for our business in the short term. We had to shut down all of our physical spaces around the world. But it has been a tremendous blessing for us in the long term. We were not prepared for such an event. That is our fault. This event has made us look carefully under the hood of our business and evaluate our business model. It is clear that we were too reliant on too few streams of revenue, which made our business model fragile. So we are adjusting our business model so that we can be prepared when the next such event happens.
What are your short term and long term goals to mitigate this disruption to your business?
Vikram Bharati: We’ve pivoted quickly to include more digital products and services. Because we are a mission-driven, community-focused, hospitality business, it is critical for us to engage with our community before they arrive at our physical locations and long after they’ve left our physical spaces. So we’ve launched the Draper Entrepreneur Network or DEN, which will be our online community that will continue to drive our mission digitally. We’ve also launched Draper Startup House Ventures, which will continue to help our members raise capital digitally. Additionally, we’ve launched the Draper Startup House Academy, which will continue to provide education to our community digitally.
What are the operational adjustments you have enforced to ensure business functioning amidst this crisis?
Vikram Bharati: We’ve been forced to become more innovative. We asked ourselves, “how can we still get travelers to fly to different countries and immerse themselves in the business culture of these countries digitally?” So we launched the Global Venture Exchange Program, where we flew 300 travelers to 12 countries in the span of 3 days with 0 jet lag. This was a digital program where the 300 travelers landed in 3-4 countries every day and met with business founders and did live sessions with them.
We’ve taken everything we do physically on a day to day basis completely online. Our New Normal program is conducting daily virtual co-working, virtual masterminds, virtual happy hours, virtual yoga and meditation, virtual coffee talks, virtual speed networking, and virtual entrepreneur in residence programs. As you can see, our operations are thriving. We’re just doing it all digitally.
When do you think is the end of the tunnel? Do you anticipate solid revival and growth for your business/industry when all this ends?
Vikram Bharati: We think the world will start to return to somewhat of a pre-pandemic normal in the next 6-12 months. We are very bullish and positive about the future of the world and of humanity. We believe that travel, hospitality, and physical human connections are innate genetic dispositions of the human race built over millions of years. It is our natural state. And we will quickly find a way to get to our natural state as we have always done.
Do you think that the situation in the country/countries you operate in could have been managed better?
Vikram Bharati: Every government in the world should have been more prepared for this event. As I said earlier, this was not a “black swan” event. It was a “white swan” event. Hopefully, this is a wake-up call for us all. Every citizen in the world should push their governments to invest in being more prepared for future biological events. Because they are destined to happen again and again.
For exclusive stories on the COVID-19 pandemic by AsiaTechDaily, click here.