When the COVID-19 pandemic arrived in early 2020, I wrote a piece on this site offering reassurance that the world had been through difficult periods before and would be through this one too. The piece was sincere and appropriate to the moment, in which the disorientation was real and a stable voice was useful. Looking at it now, six years later, the more useful piece would have been about what specifically founders should do during macro shocks to position their ventures for the period after the shock has passed. Reassurance is a posture for the first week of a crisis. Strategy is the posture for the months that follow.
I want to write that piece now, drawing on what I learned through the pandemic, through the currency crises Zimbabwe has continued to produce since, through the political shocks of various election cycles, and through the cumulative experience of operating ventures across multiple African jurisdictions during the period in which “macro shock” has been the operating environment rather than the exception. The framework I have come to use is not psychological. The discipline of staying calm matters, but it is not what separates the ventures that emerge stronger from the ones that do not. The separation is structural, and it is built into specific operational moves that founders make during the shock period.
The four moves that distinguish ventures that emerge stronger
The first move is to preserve cash aggressively early, even when the shock seems short-lived. The instinct in the first weeks of a macro shock is to assume the shock will resolve quickly and to maintain operations as if normal conditions will return. The instinct is wrong more often than it is right. African macro shocks tend to last longer than founders initially estimate, and the cash a venture conserves in week three of a shock is the cash that lets the venture make strategic moves in month nine. The discipline is to assume the shock will last twice as long as the optimistic forecast and to act accordingly. Cut discretionary spending immediately. Defer non-essential hires. Renegotiate fixed costs where renegotiation is possible. Build cash position rather than maintain it. The ventures that emerge with healthy balance sheets are usually the ventures that began the cash preservation early, before the situation forced it.
The second move is to identify which of your customers are most exposed and which are least exposed, and rebalance. Macro shocks affect different customer segments differently. A pandemic affected hospitality and travel disproportionately while leaving certain technology categories largely untouched. A currency crisis affects import-dependent businesses sharply while leaving export-oriented ones in a stronger position. The founder’s job during a shock is to read which of their customer segments are exposed, which are insulated, and which may even benefit, and to adjust the venture’s commercial focus toward the segments that can sustain purchasing through the period. This is not opportunistic; it is responsible. A venture that loses thirty percent of its revenue when the exposed segment of its customer base contracts has not adapted; a venture that has rebalanced toward less-exposed segments and held revenue steady has done the work the shock required.
The third move is to invest deliberately in capacity that will be valuable on the other side. Macro shocks produce opportunities that are visible only to founders who are looking. Talented operators become available because their previous employers downsized. Real estate becomes affordable because incumbents are exiting. Customer segments that are temporarily distracted from category alternatives become available for the first time. The ventures that emerge stronger are usually the ventures that hired, leased, expanded, or otherwise invested counter-cyclically during the shock period, because the conditions for these investments are unusually favourable when most competitors are retrenching. This requires having the cash position the first move preserved, and having the strategic clarity to deploy it during a period when most founders are paralysed.
The fourth move is to maintain and even intensify communication with the capital network during the shock. The founder’s instinct during a shock is often to go quiet, on the assumption that nobody wants to hear about a venture that is struggling. This is structurally wrong. Investors, partners, and senior operators are all watching how founders respond to shocks; the response is more diagnostic of the founder than years of normal operations are. A founder who communicates clearly, transparently, and frequently during a shock builds capital-network credibility that pays dividends for the rest of the venture’s life. A founder who goes silent during the shock signals that they cannot be relied on to communicate when conditions are difficult, which is precisely when the capital network most needs to hear from them. The discipline is to send the update, take the call, attend the conversation, even when the news is unfavourable, because the consistency of communication is itself the asset.
The macroeconomic posture, not the macroeconomic prediction
I want to distinguish the discipline I am describing from a different and more common move, which is to attempt to predict the duration and depth of the macro shock.
Founders who attempt prediction usually fail, because African macro shocks are produced by combinations of factors that even sophisticated economists cannot reliably model. The shock that was supposed to last six weeks lasted eighteen months. The currency crisis that was supposed to be one-off recurred quarterly. The political event that was supposed to be transitory became structural. Predicting the macro is the wrong discipline; it produces decisions that are calibrated to a forecast that does not arrive.
The right discipline is posture rather than prediction. The four moves I have described are the right moves regardless of how long the shock lasts or how deep it gets. They are robust to forecast error. A founder who runs them assuming the shock will last six weeks will do the right things if it lasts six months, because the moves are designed for the structural condition rather than for any specific duration.
This is also why the moves are structural rather than psychological. They do not require the founder to feel calm or hopeful or confident. They require the founder to execute specific operational decisions on a defined cadence, regardless of how the founder feels. The execution is what produces the venture that emerges stronger; the feelings of the founder during the shock are largely irrelevant to the outcome.
The Cafe Oldrock pandemic example, briefly
I have written elsewhere about how Cafe Oldrock navigated the COVID-19 lockdown, and the pattern I described is roughly the pattern this piece names. The cash position was preserved aggressively in the first weeks. The customer base was rebalanced from sit-down to takeaway and delivery, with the menu adjusted accordingly. Capacity decisions during the shock were calibrated to what the venture would need on the other side rather than to what it needed in the moment. Communication with suppliers, landlords, staff, and the small set of strategic relationships was maintained transparently throughout.
The result was a venture that emerged from the lockdown weaker than before in revenue terms but structurally stronger in other ways. The customer relationships that had been deepened through the shock period became disproportionately loyal afterward. The operational adjustments that had been forced by the lockdown produced a leaner operation than the pre-lockdown one. The financial discipline that had been instituted during the shock continued after, producing margin improvements that were larger than the lockdown’s revenue impact.
I do not claim this was clever. Most of what worked was the application of disciplines I had learned from earlier shocks rather than discoveries during this one. The lesson I want to draw is that the framework, applied consistently across multiple shock cycles, produces ventures that compound through the shocks rather than being eroded by them. The compounding requires that the discipline be in place before the shock arrives, because building it during the shock is too late.
The structural condition of African operating
There is a final observation worth naming. African founders do not need a special framework for shocks because shocks are exceptional in their operating environment. Shocks are common. The framework I am describing is, in the African context, the basic operating framework rather than the crisis framework. The ventures that operate this way during normal times are the ventures that are already prepared when the shock arrives. The ventures that revert to a different operating posture during normal times, and try to switch to crisis posture only when the crisis is visible, find the switch produces too much disruption to be effective.
This means the discipline I am describing is not really about shocks. It is about the operating posture appropriate to African markets generally, in which the macro environment is volatile enough that posture-of-readiness is the rational default. Founders who maintain the readiness posture continuously are not over-prepared during stable periods; they are appropriately prepared for the shocks that are statistically certain to come at unpredictable intervals.
The discipline is structural, the moves are specific, and the application is continuous. That is the framework. The piece I wrote in 2020 was about courage, and courage matters. The piece I want to write now is about what specifically courage should be doing during the period when courage alone is insufficient. The moves are what convert courage into ventures that emerge stronger, and the moves can be learned, practised, and institutionalised regardless of how the founder feels in the moment.
For the cornerstone on raising in African capital markets, see Raising Your First Round in Africa. For the structural conditions of resilience that make this posture possible, see What Resilient Ventures Actually Do. For the operational discipline of pivoting when conditions shift, see Mastering the Pivot in Unstable Economies.
