In a LinkedIn post in September 2022, I identified a series of reasons why the end of the year would turn out to be much less bad than expected, and why, potentially at least, the global economy could even begin to slow down its deterioration, or even rebound – without going through a recession. This prediction turned out to be correct, and stands confirmed today (except for the UK, which is now officially in recession).
In our digital sector, effects vary depending on the dangerous proximity of companies to the retail sector and household consumption. As early as last June, we pointed out the risks in e-commerce and in the payment sector. For reasons of rising rates, we also indicated risks in crypto, which have been amplified by the endless scams that tirelessly continue to plague this sector (and which unfortunately are not over).
The Made.com gold nugget: all the harshness of the market.
Even we were struck by the demise of Made.com, a company we loved and worked with for almost nine years, to the point where it had achieved hundreds of millions of pounds sterling in revenue.
Let it be said here: the Made.com adventure was one of the most beautiful journeys in European e-commerce. This team did not deserve what happened. But the perfect storm of Brexit / Pandemic / Shortages / Inflation was too much for this growth company to take.
Other customers in payment SaaS, FinTech, retail, and crypto have also suffered, all while keeping us informed of their business contractions.
But the blackest signals are moving away, and you have to speed up the luck machine!
The word “talks” has finally appeared not just in Moscow’s vocabulary – but even Kyiv’s. The front has stabilized and Russia is stalled. The nuclear option has not been mentioned for several months. Shortages are receding. Russia wants to sell gas to Europe again. Energy blackouts have been avoided, at least until July, when they will disappear from the list of concerns. Inflation is marking time everywhere… and the global economy, though down around +1.7%, is holding up.
So while rates remain high, if you want to be efficient – bet on productivity. Further, have you noticed that in spite of rising interest rates… investment remains high? We have temporarily returned to the economy of the before-time: an economy of positive rates. It’s harder for investment funds… but easier for banks. It’s harder for startups, but a little easier for companies. The wheel turns – that’s all. But you have to know how to roll with it to embrace new opportunities!
Action, education – and boldness!
In the first place, we have to know how to talk to the companies that are suffering more than others. So we need to adapt not only our offerings (price-product mix) but also the wording of our offerings – and very quickly, without asking questions for months.
So, this involves pedagogy! Yes, the recovery will be digital – as it was for the pandemic. There is no better go-to-market than digital – there is no better product than digital – there is no better service than digital.
And you know what ? Over Q2, companies will realize that the horizon really is clearing up. Gartner is talking about catching up from 2022. The crises we have known for three years were short and harsh. They redealt the cards to the most daring (if you are interested in the numbers, the box below summarizes the positive consequences of our choices in 2022).
For all these reasons – and because I believe in it – I’m sending my wishes for a wonderful 2023 to all bold managers and entrepreneurs! Run the luck machine at full speed, and it will serve you!