This year has been challenging. Things are not happening at the pace we had hoped. Progress is slow. There is no COVID-19 bump, and stress levels are high. Recently, Alli Reed, the resilient founder of Stratia, was my guest on a TIG Talk episode. She offered an eloquent analogy for the current state. She said, “It’s as if we have just emerged from a tornado shelter after a long storm, and we are expected to resume life as normal. Yet there is devastation all around us, the landscape looks completely different, and we are still processing all the trauma.”
I’ve had many tough conversations with founders over the past few weeks and felt compelled to share my thoughts. There has been a lot of rejection to deal with this year from both buyers and investors. Things are moving very slowly, and I think it will remain slow for the balance of the year. There is a lot to sort out. For many, this may not be a huge growth year. 2021 is a year that favors the Tardigrade. So, let’s review the top Tardigrade traits:
Tardigrades relentlessly pursue capital efficiency. They are laser-focused on unit and channel economics. They spend only on things that drive revenue or improve contribution margin. Every dollar deployed works hard.
2. Growth hypothesis
Tardigrades have a compelling growth hypothesis that is both testable and measurable. It outlines the arch of growth, the resources that are needed and the corresponding cash implications.
3. Growth hack
Tardigrade entrepreneurs and their teams adopt a growth hack mindset. They are constantly finding ways to challenge their assumptions. They build small controlled experiments isolating critical variables to prove or disprove essential elements of their growth hypothesis.
4. Investment ready
Tardigrades are investable and scalable. They have a clear capital strategy and a strong investor narrative. They have done the work of ensuring they can absorb growth and win investment. They have a defined order to cash process, strong supply chain, good financial reporting and all the needed regulatory, compliance and legal documentation.
5. Shopper continuum
Tardigrades recognize that shoppers don’t shop in channels. Instead, they shop along a continuum. On one end there is discovery and the other replenishment. Innovatively and effectively, Tardigrades intersect this continuum in both the digital and physical plane.
Tardigrades know their no’s. They take a metered and disciplined approach to retail, not falling prey to the allure of distribution. They don’t confuse activity with results and can discern the important from the interesting.
Tardigrades have small agile teams. They carry minimal fixed costs and adjust and adapt as the market offers its feedback. As a result, they move faster than most and embrace imperfect action.
Tardigrades have accountability and rigor infused throughout the business. They are committed to financial and performance reviews. All key stakeholders are held responsible. They have clear objectives measured by well-defined key results. They plan, they forecast, they execute.
Tardigrades build three types of community: shoppers, collaborators and champions. While most brands focus only on shoppers, Tardigrades spend similar effort building collaborative relationships and finding true advocates. The combination of evangelical shoppers, collaborative peers and champions who open doors and knock down walls serves as a force multiplier.
Like their namesake, Tardigrade brands can withstand harsh conditions. When they don’t have access to food or water, they can slow down their metabolic rate. As a result, they reduce spending, inventory and receivables. They see the benefit of slowing the pace of growth and its associated cost. Tardigrade entrepreneurs also prioritize self-care, recognizing that founder well-being fosters resilience.
I know this industry loves to celebrate the unicorn. But Tardigrades are in the best position to withstand the forces that exist in today’s marketplace. So, become one, it will serve you well.
Elliot Begoun is the Principal of The Intertwine Group, a practice focused on helping emerging food and beverage brands grow.
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