It is well known that the corona pandemic has drastic consequences for many companies: Orders are collapsing, businesses have to be closed, staff redundancies are threatening and the available liquidity is being used up. In such a situation, every entrepreneur thinks about the following questions:
How does the crisis affect my company?
When we identified the first signs of negative economic effects in Europe, we proactively addressed our clients to get a feeling of how severe the difficulties are or could become for them. Fortunately, the tax consulting industry is currently quite stable, especially in the scale of our clients, and so far none of our active clients have stopped any projects or cancelled any contracts.
On the other hand, the corona pandemic has led to early sales opportunities in our business area being postponed to Q3 or Q4. Although this did not result in a short-term negative effect on the top line, it is to be expected that sales successes in the second half of the year will be much more difficult to achieve. In addition, a clear liquidity buffer, which we built up last year through a venture capital financing round and sales revenues that were well above plan, provide additional financial security.
In view of the massive threat of insolvencies in Germany and against the background of our relatively stable entrepreneurial position, we therefore decided in mid-March to help other entrepreneurs and companies to get through the corona crisis.
Within two days, we developed a first version of a corona help tool on the basis of our technology platform, with which we show companies free of charge the state aid measures relevant to them and provide them with digital support in filing their applications. Since then, we have been continuously developing this tool further in order to keep it constantly up-to-date. See the latest versions that we made for one of our business partners here.
Individual recommendations made by the Taxy.io Corona Help Tool, Source
Meanwhile, it comprises approx. 30 measures, e.g. in the areas of tax deferrals, loans from public banks and subsidies. During the world’s largest hackathon, the #WirVsVsVirus Hackathon of the Federal Government (under the patronage of the Federal Minister for Special Tasks and Head of the Federal Chancellery Prof. Dr. Helge Braun as well as Minister of State and Federal Government Commissioner for Digitisation Dorothee Bär), Taxy.io, as official sponsor, provided technical support to a team of 25 participants working on a similar corona help solution, so that further measures were included in the help tool and digital application processes were added. The joint initiative of Taxy.io and wir-bleiben-liqui.de was finally chosen by the German government as one of 20 winning teams (out of 1,500 participating teams), which resulted in further pro bono cooperations with leading law firms.
Our Corona Help solution has now (09/2020) been used almost 45.000 times and comes with a proven user satisfaction rate of over 98%. By helping other founders and entrepreneurs to “sail through the storm” during a period of economic depression, our 20-strong team has created a positive can-do atmosphere that has released sustainable energy and strengthened cohesion. As founder, I’m very proud of such understanding and mindset of our team members.
How do we get through the crisis?
After a few weeks of intensive voluntary work on the above mentioned Corona Help tool — parallel to the usual daily business — we have noticed that leading law firms and tax software companies are also interested in a whitelabeling solution (with their own logo and possibly their own content). Therefore, in a few days we sold branded versions of the Corona Help tool for law firms and software companies, including a maintaining and updating service. At the same time, we continue to operate the public Taxy.io version free of charge, which not only helps companies directly, but also provides smaller tax consultancies with an intelligent guide for their client advice.
In this way, the Corona help tool is not only our contribution to the fight against the effects of the virus, but also an effective tool for team motivation and a sustainable marketing instrument as well as a revenue generator, which means that we have never been as busy as we are now. As a result, we can once again exceed our financial targets in Q1 and Q2 and even expand our workforce.
Official Taxy.io mask
What happens next?
Just as the economic impact of the corona pandemic will be temporary (albeit for an incalculable period of time), so will the need for a corona aid tool be temporary. With this in mind, we are supporting other entrepreneurs as best we can in the current critical times with access to aid measures and are using this phase to advance our brand as a provider of automation solutions within the tax consulting industry.
The crisis has put issues such as digital jobs and processes, cost reductions and sales increases at the top of the decision makers’ agenda, and so we are now focusing our external communication on these topics. This is because Taxy.io solutions enable employees in tax consulting and tax departments to work from their home office, they will be able to research and analyze more quickly and, thanks to our AI technology, they will find further consulting opportunities for their clients. Thus we hope that the above measures will enable us to return to “daily business” after the crisis with increased demand and with a strengthened team.
Even though we have found a productive modus operandi after meanwhile 10 weeks of home office, we all miss the joint work on “our Taxy” with the whole team and can’t wait to come back on site to our offices in Aachen and Cologne.
Entrepreneurial crisis take aways
As this is my first real crisis as entrepreneur (and probably not the last) I’d like to document and share my takeaways.
Stay calm
When reading the news one could become easily depressed due to a global economic catastrophe with billions of public loans injected into the economy, millions of laid off workers, crashing stock markets etc. While staying alert, we were trying not to freak out like a frightened chicken but calm down and think.
Analyze
What are the exact effects on our company?
Are we in survival mode or can we benefit from the current developments?
How do we decide to react?
Where can we cut costs without loosing speed?
How does our team feel about all that stuff that is happening?
Observe
How do other companies in a similar position or similar market behave?
What kind of signals do we get from our investors regarding their portfolio?
Where can we get help or to whom can we offer our help?
I want to underline that the solidarity among the startup community was exceptionally during the corona period, incl. a German Startup Association highly engaged in saving plenty of innovative young companies!
Carry on
After stopping, thinking, observing and planning the next steps, we carried on. The decisions we made and actions we took were outlined in this article above (rapid developing and marketing of a new product in addition to daily business, hiring additional talents, etc.).
Although tough times aren’t over yet (esp. with a potential second wave) I see that the ice is melting and hence, look confident to the future — with a strengthened “Team Taxy” I know I can count on.