Can PR push a ‘restart’ button for cash poor startups?
It has been well over a year since the outbreak of Covid-19 and the resultant nationwide lockdown. Gradually, we are getting habituated to the new normal, i.e. living with the pandemic.
Battle of funds for the startup industry
Except for the Healthcare and Edtech industry, the pandemic impacted every business sector and the startup industry was one of the worst affected sectors. When the outbreak of the virus was at its peak, around 70% of the overall startups faced low cash reserves and many, even shut down their operations permanently.
Although the current scenario is better now, as compared to last year, however, the major problem that almost every startup is dealing with is the scarcity of funds, especially in the early stages of its business cycle. The reliance of the startup industry on government has increased and what it badly needs are grants, loans at low-interest rates and tax reliefs to avoid future lay-offs and halting of operations.
Recently, the government through its Commerce Ministry, has announced Rs. 945 crore seed fund scheme for startups to help them out with early-stage funding with some terms and conditions. The government has also said that it will help the startups with raising debt capital by providing guarantees.
But the question arises, is that really a sigh of relief for the startup ecosystem? Not really because the number of active startups in India to date is around 39,000 and Rs. 945 crore is quite insufficient for such a large number of startups, especially at the time of zero growth in the economy. Investors are more cautious about investing in and betting safe. Given the scenario, even the startups that might be deserving are unable to attract the attention towards their idea.
Public Relations: An efficient technique for the revival of the startup Industry
As pressure grows for funds, startups need assertive PR techniques too for the revival and overall growth of their businesses. Efficient PR techniques do not just work towards reputation management, it might also work wonders for entrepreneurs when it is about sharing the sustainability of the model and attracting the right audiences. In such a critical time when startups are facing a shortage of funds, investing in PR might just be the better choice over advertising.
It is more about faith than sale
To attract an investor’s attention an entrepreneur would want to highlight points like- reliability, sustainability, balance, monetization model, scope and market for the startup etc. It is much more than a promotion or milestone. To create a word around the startup and storytelling has become the need of the hour for a lot of entrepreneurs. And this is exactly what a good PR strategy can enable for the aspirants.
It is always hard for startups, especially at the time of the dwindling economy, to survive. And it becomes more difficult when the startup is still at an early -stage. Over the period PR has been adopted as an additional service for the startups. However, in the covid era it might get a front seat with the increasing relevance.
Shivani Swaroop, co-founder, iHorizon Communications Pvt. Ltd.