Last week’s collapse of Silicon Valley Bank (SVB), the tech startup world’s biggest lender, left thousands of company owners and CEOs scrambling to figure out how to make this Friday’s payroll and ultimately stay in business. The federal government ultimately stepped in to help with the immediate need, but aftershocks of the SVB (and fellow financial institution Signature Bank) failures will likely continue for months.
In an already tough business climate, the bank failures underpin just how important it is for startups and large corporations alike to reduce burn rate and maintain a positive cash flow. It sounds easier said than done, but SureCo founder and CEO Matthew Kim says it’s 100% possible.
“Caring for my employees is my utmost priority,” he says, “and I know if my company were affected by a collapse like this, I’d be doing everything in my power to ensure they were paid on time and business was conducted as usual,” he says.
To that end, Kim offers 4 creative solutions leaders can implement now to extend their runway.
Switch from traditional group health insurance to an Individual Coverage Health Reimbursement Arrangement (ICHRA).
By leveraging the individual health insurance market, SureCo has been able to help mid-market and large employers save an average of 20% on their monthly premiums while giving employees the power to choose any plan that best fits their needs. Fill out our Savings Calculator to see how much you can save instantly.
Try “reciprocal marketing” in lieu of ad spend.
Turning off ad spend is one of the easiest levers you can pull to conserve cash now. But that doesn’t mean your marketing efforts need to come to a halt. With so many companies in the same need-cash-now boat, consider promoting non-competing companies’ products if they do the same in return. Our marketing team has had success doing this as a way to book demos.
Reconsider remote or hybrid work.
If you’ve recently brought employees back into the office, consider rolling back those changes. Even if you can’t get out of a lease, you’ll be able to save on electricity, office supplies, cleaning fees, and more by having fewer people in the office.
Examine your tech stack.
Similar to how individuals continue to pay for subscriptions they don’t need or don’t remember they have, businesses should look at every third-party vendor on their P&L lists and be sure to check employees’ corporate credit cards for reoccurring expenses you might not be aware exist. For the vendors you do need, ensure you’re not overpaying for additional seats or tiers of service you could live without.
Want to learn more about switching your company to an ICHRA? Download our ICHRA Guide now.