What should early-stage startups with limited resources prioritize during the recession?

Even though it hasn't been officially declared, this tech recession is real. And it's not going away in the first two quarters of 2023.

According to layoff.fyi, 1,040 tech companies laid off 159,684 employees in 2022.

In 2023 so far, 75,912 employees were laid off.

That's more than 235,000 people.

Some analysts say the storm will end in the second half of 2023.

We have a few more months to go before we see the light at the end of the tunnel. And this leaves early-stage startups with one choice: you have to adapt and find new ways to keep your head above water.

One thing every early-stage startup has in common is limited resources.

And, according to a survey done by January Ventures, 80% of early-stage startups have fewer than 12 months of runway.

That's why, during a recession, your main goal should be to find scrappy ways to increase revenue and lengthen your runway. And this task can only be done by a collective effort of all departments, not just sales.

Below you'll find 16 recession-focused ideas that could be used by your sales, customer success, marketing, and product teams.

It's time to adapt or get left behind.

What should sales and customer success teams do in 2023?

• Focus on expansions and upsells with current customers. Acquiring new customers is costly because of two reasons: (1) paid channels are more expensive than ever due to recent privacy regulations and increased competition, and (2) buying cycles are longer than usual due to market uncertainties. Instead of spending your time, money, and effort on chasing new deals that might not be won in the next couple of quarters, focus most of your energy on upselling or offering expansions to existing happy customers.
• If you still need new customers, identify your most satisfied industries and preferred use cases and double down on them. If your business is not suitable for expansions or upsells, you don't have any choice but to find new customers. Focus your efforts on finding success patterns. Which customers have more active and happy end users? Which industries bring more revenue? Which use cases result in shorter deal cycles? You have all the data to help you work on your roadmap.
• Do huge "first year" discounts to acquire new customers. Once the storm is over, you'll have the chance to keep them as customers. Two conditions: (1) make sure you're making discounts for your ICPs (ideal customer personas) with a proven product-market fit to keep churn rates low and (2) stay away from high-maintenance customers and industries.
• Proactively arrange 1:1 calls with your customers to see if they have any requests, issues or concerns. Times are uncertain and you never know what may come up in those calls. You have to show how proactive you are as a service provider. This also helps you with updating your sales narratives, marketing campaigns, and product planning.

What should marketing teams do in 2023?

• No more BS campaigns focusing on vanity metrics such as views, impressions, or reach. Marketing campaigns should focus on revenue and revenue only while aligning with the sales narrative. Whether it's a new downloadable asset or a webinar series, your focus should be finding qualified leads and nurturing them into sales.
• Update your messaging with a sense of urgency. Remind your visitors, leads, and prospects what they would lose if they didn't start using your product. Create FOMO but don't frighten them. Fear-based marketing is a dangerous path. Customers should be able to make decisions based on the value of your product, not the fear you instill. We use FOMO to attract attention, not to prove our point.
• Redefine your ICPs. A recession comes with new challenges, pain-points, and motivations for your target customers. You cannot reach out to them with your old messaging and expect the same results. They have different priorities and you have to adjust to them.
• Conduct competitive research to see how others are adapting. You're not alone in this. Every other direct or indirect competitor is experiencing something similar. What have your competitors announced lately? Any new features or products? Have they changed any of their messaging on their website, social channels, email or paid campaigns? Don't copy but use them for inspiration.
• Find more use case and industry-specific proof points to convince buyers. Build a landing page with an ROI calculator to show your product's value. Add success numbers from different industries or use cases so each buyer can see if there's already a happy customer similar to them. Ask your happy customers to record quick video testimonials or send short customer quotes to use on that page. Strengthen the page with some G2 comments and badges if you have any. Nowadays your prospects need more proof-points than ever.
• It's a great time to invest in your owned channels, starting with your blog. It takes at least 3-4 months to start reaping the benefits of investing in content marketing and SEO. That means you can see your website rankings get higher in relevant search terms in the second half of the year if you start investing today. Most analysts say that the recession will be over by the second half of the year so you'll be ready to see the compounding affect of content marketing ROI by that time. Find some affordable freelancers to help you create top of funnel content to drive organic search traffic that you can convert into leads and prospects.

Related: How I Built a Marketing Plan and Increased Search Traffic by 26x While Doubling the Inbound Leads

• Find internal and external sources to create bottom of funnel content. Finding freelance writers for technical topics can be very pricey. Depending on your product and how technical it is, you can create content with your peers from the sales or product teams who know the product more than a freelance writer. You can also interview industry leaders or even your customers to create technical content. Ask them some technical questions and you'll receive answers that no other freelancer can write for you.
• Repurpose and redistribute existing content. Whether you have a content marketing budget or not, you should prioritize repurposing your existing content into different formats and redistributing them in new channels. Turn your webinars and podcasts into ebooks, LinkedIn posts or Twitter threads. Create an email course out of your most popular blog posts. Reformat your case studies into short videos. Find which formats and channels are working for your audience and double down on them.
• Collaborate with your sales team and start recording demo videos for different industries and use cases. Unless it's an enterprise buyer with complex needs, most buyers just need to see if your product solves their specific problem. Also, today's buyers have more access to information than their counterparts from the last decade. They just want to see the product without the sales fluff. So, pick a couple of industries and use cases as an experiment for your pre-recorded demos. Emphasize the benefits of your product and most used features for that industry or use case in the talk track of the demo. Ask your sales team what types of objections they hear during their calls and answer them during the recording. Keep the demo videos short and tell the prospects they can still have a more detailed call if required. This will help you filter out the prospects that don't fit your product and save a lot of time for your sales team so they can focus more on closing deals.
• Find other startups that are complimentary to yours and start a partnership program. You're not alone in this. There are many similar startups out there that have similar goals and struggles. Find the ones that are open to partnering. Bundle your products to share your audiences and customers. Increase your reach and validate your value by leveraging your partners' brand recognition.

What should product teams do in 2023?

• Find out the high-demand product, feature or integration requests from your customers and prioritize them. This is something every product and developer team should avoid in normal conditions, but the reality is customers don't really care how efficient the scrum methodology is. The question is what product developments will make your customers keep using your product? Which integration is requested more than others? Which feature or UX change can increase product adoption and active users? Short-term, tactical and agile thinking became as important as long-term planning and product roadmaps this year.
• Focus on increasing product retention. Keeping current customers (and users) active on your product is much more crucial than finding new ones. How can you increase end users' product usage by email or in-app notifications? Would bi-weekly/monthly customer support calls or creating a community space increase retention for your product? How can you include some personalization elements in the user experience to increase loyalty? What are the stickiest features that active users adopt most and how can you replicate this success with other users?

What other ideas do you have for early-stage startups? What can other departments do to bring in more revenue while making the best use of their limited resources? Add yours to the comments section.

This will be a difficult year, but we'll get through it.

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Cheers!