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The hot takes have cooled down

Four years last week since our businesses got shut down for pretty much two years. That was a time.

By spooky coincidence, I was listening to music on Spotify last week in the car, and it randomly served up one of my old podcasts from that period. Tips on how to keep your business alive as all collapses around you with no clear path out. Pre-Jobkeeper subsidies.

Hearing it back, I’m surprised how chilled I sounded.

I did write a bit at the time about the demoralising gap between the COVID haves and have-nots. People I knew with IT companies asking me how I was going, listening for five seconds, then saying “Well my business has NEVER BEEN BUSIER!”.

Back then there was a lot of predicting what it all meant long-term. These things can take a while to shake out.

Four years seems enough to let the hot takes cool down. So I thought I’d do an update on how it’s all played out since our business near-death experience.

“People will remember what you did this month for the next decade.”

We kept almost all the staff we went into COVID with, we made that commitment before JobKeeper was announced.

Others in our field didn’t, throwing their staff overboard in that grim March. Before inviting them back when the subsidies started. We saw what you did there.

I wrote at the time: “people will remember what you did this month for the next decade.” And so far, 40% into that prediction, most have.

Four years on, despite the hair-greying stress, COVID has been an overall plus for our business. Both in what the business does, and how it performs.

We were purely an events and presentations business going into COVID. We set up virtual studios in our warehouses, like almost everyone in our field. The idea was to add some studio gloss to the important announcements, rather than just a CEO in front of another damn bookshelf.

Our staff go to Lockdown University

It became clear about a week into it that the visuals and pacing of business presentations were terrible on the small screen.

So slow and amateurish. Watching on a laptop is a big stretch of attention spans, and the standard PowerPoint shuffle put the folks at home into a coma after fifteen minutes.

So we hired freelance TV professionals to come in and direct. Speed it up and choreograph the moves. Over the course of the lockdowns, the shows got so much better. Three-hour presentations got compressed into 45 minutes and everyone was the better for it.

We made no money at all from this pivot. Remember that, the word of 2020? But it allowed us to stay alive. Just as importantly, it acted like a kind of TV university for our crew.

They picked up a whole range of skills they wouldn’t have learned otherwise. It moved us into another level of work, projects we wouldn’t have got near if not for the COVID lessons. And we bought a lot of new tech to support their urge to push fancier buttons.

We emerged two years on, thinking the future of events would be a hybrid of live and virtual events. We did a big marketing campaign to highlight that we had an intact, experienced team ready to roll again. Under the theme “Match fit for the hybrid era”.

It’s always interesting to see what clients say they want, versus what they actually do when they vote with their money.

Did clients really want virtual events?

No.

The people want drinks and treats

Most people wanted to be back in the room. With drinks and fancy food, bantering about their specialty subject with others who felt the same. After two years locked up with their loved ones who really didn’t care much for their supply chain or cloud solutions chat.

That was good for us. Live events are much more profitable for us than virtual. Ominous for those who had bet big on virtual platforms being the new normal.

The year out of COVID — financial year 22/23 — was insane. We had the staff. Many others didn’t. We ran flat out for a year, while getting lots of calls from other clients a week out from their event.

“Hiiii! We’ve not worked together before, our regular supplier just told them they don’t have the people to do our event next Tuesday, any chance you can do it?”

It was like running an all-business class airline at capacity.

The main constraint was not working our staff to death. Our industry is known for its long and strange hours. We do our best to ease the pain with better planning, but it’s still the reality that we’re first to arrive and last to leave. Everyone had lost match-fitness from the Zoom couch years, and the return curve was a steep one.

We made a lot of money that year, and plowed most of it back into buying expensive tech for our staff to do bigger projects.

Things are perfectly good

There’s not room for it here, some time I’ll do a deeper story on how the asset-light model of Uber, AirBNB and others is now assumed to be the only enlightened path for the modern company.

In some sectors, it just isn’t.

Our industry is literally the same as the Monopoly board game. You reinvest each time you go round the board. Do that for ten to fifteen years, and it’s a formidable moat.

You just have more pieces on the board to deploy, and you get money from both regular clients and “asset-light” competitors. You have better quality control because you own all the stuff, and clients find that reassuring.

High scaling costs are obviously old school and get no love from media or the rocket emoji crowd. But they have their advantages. I sleep peacefully at night knowing it’s near impossible for anyone to come in and take us down, no matter how deep their pockets. They could buy the working assets, but they can’t get enough people to make them work.

We were expecting a decent revenue drop this year given the champagne-pop vibe of that first escape-from-COVID year, and downbeat consumer sentiment. It hasn’t happened yet. The mad edge has come off demand, but things are still perfectly good.

We’re now nearly twice the size we were when we went into COVID. We’re doing projects that make us proud.

Our whole industry has bounced back, which is nice given how much punishment we all took.

So what have we learned?

1. Don’t bet against human nature

It’s a brave bet that your new tech will cause people to abandon millennia of human behaviour.

Smart true tech believers put hundreds of millions into online event platforms, equity priced on a brief window of 2020 growth curve. Their thinking was: “why would anyone bother going to a live event ever again? So inefficient. This will be the new normal.”

It all distils down to the oldest business mistake in the book: thinking that customers are all like you.

Virtual events are a thing, but a small fragment of what those investors imagined. Regular non-tech humans like to go out and catch up. Rivers of cash flowed into the sea, never to be seen again.

2. Check Your Balance Sheet

I’ve written before how most people get distracted by the monthly adrenalin rush of the P&L, the most gamified of the financial statements. While frumpy old Balance Sheet barely gets a look.

Until things start going wrong and there’s Balance Sheet saying, “I had the whole story all along but did I get so much as a glance? No.”

We went into COVID with a strong balance sheet and it saved our arses. It also allowed us to come out of the shutdowns on the front foot, rather than on a saline drip. Keep an eye on that thing.

3. Full-time staff are good for your business

Increased casualisation of jobs that should be permanent is a current plague on society. Casual work suits some staff at some stages of their lives, and if they want it, great.

If they don’t, and you force it on them, you are scum and it will make your business worse long-term.

People having a career path and being with others they like working with is a massive element of delivering the service that causes word-of-mouth growth.

A few big names in our industry had full-time well-paid management teams, but the people who actually executed the work were all freelancers to keep fixed costs to a minimum.

Where’s your cultural advantage when people thjose work for all your competitors as well? Clients notice.

Then the skills shortage left those companies a sad shadow of their former selves. No sympathy from me.

4. The worst times are the opportunities

We started our business just before the global financial crisis, and that shakeup gave us a vital leg up.

COVID was horrible but complaining and freaking out wasn’t going to change anything. Bad times are when the opportunities happen.

In good times, most clients are quite placid and don’t change suppliers often. Growing your company to the next level is a long grind.

Every so often there’s an event like this that doesn’t just reshuffle the industry cards. It throws them in the bin and deals a whole new set. I know it’s hard to think about opportunities when you’re just trying to survive, but that’s when you can make the moves to set you up for decades.

5. The greatest cliché of all

I’m trying to find a way to write this without it being predictable or schmaltzy. Last time I went to an industry awards night, the next table was playing the drinking game where you drink each time a winner thanks their awesome team.

Their drink to award category ratio was very close to 1. Then they won their own award late in the evening, bringing the loosest and best acceptance speech I’ve ever seen.

The cliché is true. Assembling a team that is both skilled and likeable takes years. It’s the hardest thing.

Every so often, you must choose between them and your own self-interest. And take action that proves that choice.

And by action I mean things that will cost you money personally, not HR department platitudes.

None of us questioned for a moment that we had to spend whatever cash we had on March 13^th 2020 on keeping everyone on board until it ran out.

And it all worked in the end. Whew. Let’s have no more pandemics for a while, thanks nature.

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