We are approaching two years of living with COVID-19. People are fed up with lockdowns. They are fed up with travel restrictions. They are fed up with the ever-evolving virus that causes COVID-19. This exhaustion leads to a lot of talk about a “return to normal”. Yet no one seems more excited about a return to normal than the legacy companies that had to adapt quickly to the watershed event that was the pandemic. These monoliths were forced out of their comfort zones and to think flexibly. Their inability to adapt to speed was revealed. At the same time, I’ve seen more small businesses and startups step into their element than ever – challenging the status quo and ready for new challenges.
I experienced this dichotomy firsthand last year, during the recent Bloomberg New Economy Forum in Singapore. (I am a member of the inaugural class of Bloomberg New Economy Catalysts). The first, and perhaps most apt example, was the visible squirming of legacy financial brands looking for ways to downplay the success of blockchain and cryptocurrencies during a workshop. If the technology “really worked”, someone thought, then MasterCard
This was summarily dismissed by other participants as incredibly myopic, especially between me and my fellow Bloomberg Catalysts. It’s this kind of thinking that leaves legacy companies struggling to change course, when truly market-disrupting startups are forging new paths to success.
My own entrepreneurial journey was once guided by the rules created by big business. You had to do business from one of the major world capitals, not somewhere like Lagos, Nigeria. You had no choice but to have face-to-face meetings with financial institutions or traditional investors if you wanted to be taken seriously. You wouldn’t dream of trying to raise capital with a presentation given on a Zoom call. You were only considered legitimate if you could get on a plane and speak at major global conferences that were the domain of corporate celebrities.
It wasn’t until the global shutdown, caused by a deadly virus, that the rules changed to everyone. The playing field has shifted from global analog arenas to technological sandlots. This is where entrepreneurs know how to thrive. I couldn’t have been more impressed with the list of catalysts and their work disrupting industries and markets around the world. It has always been their domain, but the situation of the past two years has only made them more determined.
Yet one question remains: in the new economy, is there a standard size, agility, or even style for a successful business? AT AZA Finances, we have 150 employees located in Lagos, Nairobi, London and Madrid. We’ve built technology platforms from the ground up that manage over $2.5 billion in global transactions. Yet when I said we have $25 million in annual revenue, sometimes the answer was “Hey.” Keep in mind: these were more “legacy” companies, not the Catalyst community.
So, isn’t it successful enough? It smacks of “old economy” thinking. We need to take a serious look at the market cycle we find ourselves in and the companies that are forming or consolidating. We know that people no longer just want to work in big companies. New graduates want to work in small companies. This is because small businesses are more agile. This is important for a rapidly changing planet with ecological challenges, health issues and challenges of working from home. Adaptability and agility are crucial but difficult for those who succeeded in the old economy.
One of the attendees was from DeepMind Technologies, Alphabet’s artificial intelligence subsidiary. He explained how they used data to change the way vaccines and health breakthroughs were developed. With the data, they can model biology and science without the need for traditional wet labs. It’s a radically different way of doing research. If you’re a company that’s invested billions in a model-based research structure that requires wet labs, it’s hard to unravel a change of this magnitude.
The Forum drove this home. We are already in a new economy. In this world, you can fundraise from anywhere. Businesses may look different and they will act differently. They will take radically different approaches and it will be extremely difficult for traditional businesses to adapt. These “new economy” companies will be, just as we the Catalysts were in Singapore, the people brave enough to push the bear and challenge the status quo.