Entrepreneurs can learn from the global view of Europe: They should stay lean, modernize their products, and adapt constantly.
Recently, I attended a speech given by Ignazio Cassis, the Swiss Minister of Foreign Affairs. This article is not about his speech, but about one statement that stood out:
“Everywhere I go, this is how people see Europe: Aging, indebted, not ready for the future. This is a clear sign that the good times are over, and we should prepare for the worst case.”
I am glad that I am not alone in my view that the good times are gone.
What does this mean for entrepreneurs?
1. Fight the Aging: Refactor Your Product
Age brings about the privilege of experience, but it also brings about fragility. What is true for people is also true for software products.
At Yonder, we started developing our current product 6 years ago. Some two years ago, we started refactoring and therefore rejuvenating our product.
Replacing the legacy iOS app with a brand-new native app.
Putting in a cluster database.
Migrating our infrastructure to a Kubernetes-based setup.
Introducing new microservices to get away from the original monolithic application.
During our recent ISO 27001 recertification audit, I used the term “legacy” quite often when we discussed software architecture. The auditor raised his eyebrows and asked if there really is “legacy” in an application just 6 years old.
Yes, sir. There is legacy. But constant refactoring of our product keeps us ready for the future — both in terms of technology and scaling.
2. Fight the Debt: Be A Lightly-Capitalized Business
Your grandma was right. You can’t spend more than you earn over longer periods.
Although everyone knows that, the low-interest era of the last few years has lured investors and private households into abandoning common sense.
Now the party is over. Interest rates are rising, startup valuations are folding. Just like private households, all those ventures with high debt and huge valuations still burning money will face tough times.
Thankfully, we never rode the unicorn train and raised ever-larger rounds. We have always been very capital-efficient, and this has helped us stay a lightly-capitalized business. Although this path was and sometimes still is painful, it’s a lot less painful than increasing debt and investor dependence.
3. Ready for The Future? Ready for The Future!
Nobody knows what the future will hold. However, I am convinced that a SaaS business with a modern product and a light balance sheet is much better prepared for whatever might come than if you have to fight tech debt and bad financing terms.
Being ready for the future is an attitude. We will never have the perfect product, and we will always have room to become more capital-efficient, but that doesn’t mean we stop improving.
Just as Kennedy said: Don’t ask what the company can do for you, ask what you can do for the company.
This will keep you ready for whatever the future might bring.
