This link has been bookmarked by 6 people . It was first bookmarked on 10 Oct 2008, by someone privately.
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13 Oct 08
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11 Oct 08
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10 Oct 08
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You may know that I am involved with Zillow. They did a survey of their users to
ask what they thought was the current impact on home prices across America. The
average answer was that homes in America were down 20‐30% in value. The
survey then asked what the user thought had happened to the value of their own
home. Miraculously they thought their own home had retained value against the
odds! Surprised? It is human nature. As most of you read thi s, you will be thinking
in the back of your mind why your company is different than the average company
like these homeowners) and why you are the exception that doesn’t need to take
(action right now. This could be a rationalization. -
1. You don’t realize how fast things spin out of control. There are self‐
reinforcing negative affects in a downturn.
2. Don’t spend money until you have to
a. Don’t move out of your office until you are sitting on top of one
another
b. Don’t hire any incremental employee until you just can’t stand it
c. Don’t get more capacity in your data center until your site is going down
3. Better to be “late to the party” than to be early and run out of money
4. Line item review of the budget every month (legal, accounting, everything)
5. Not just a CEO mindset, but a company mindset
a. Everyone must buy into the process
b. But in a calm way - not run for the hills
6. Create 2 or 3 different burn scenarios - know at any point in time how many months of cash is left.
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