What can the 2000 dot-com crash teach us about the 2022 tech downturn?

Welcome to TechCrunch+ Tuesday

During a recent Twitter Space, M13 Partner Anna Barber and I looked back at the dot-com crash in search of lessons operators can use to avoid missteps founders have made in past downturns.

In our chat, Barber spoke about how founders can better align with investors and employees while managing uncertainty, the dangers of growing too quickly, and the economic, social and emotional impacts created when so many companies close their doors at once.

Many entrepreneurs have been encouraged to believe that smooth storytelling and good social skills are enough to convince investors that things are moving according to plan. They are mistaken.

Instead of instinctively going into survival mode, she said founders should ask themselves existential questions like, “Why did you start this business? What are the fundamentals? Who are your customers? What problem are you solving?”

“At a time like this, trust is more important than ever,” said Barber, adding that she tells entrepreneurs to stay in close touch, “particularly around bad news.”

Before problems arise and between regularly scheduled meetings, entrepreneurs should get comfortable with asking for help and advice. Reaching out to share an update or ask questions sends a strong signal that you’re not waiting for someone to give you direction.

“Tell them what you need. This is what we’re here for: to roll up our sleeves and help problem-solve with you. Nobody expects any of this to be smooth sailing,” said Barber.

Thanks very much for reading TC+. Have a great week!

Walter Thompson
Editorial Manager, TechCrunch+
@yourprotagonist

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