Need for a relook at the coveted status of "Unicorn":

It is so disturbing to know about some tech companies, including those which have achieved the coveted status of "Unicorn", laying off their staff in hundreds and even thousands.

Such staff might have dreamt that their companies would be achieving a status akin to Facebook or Amazon etc, and that they would be becoming millionaires, but now would have seen such dreams turning into their worst nightmares.

According to a news report, "After reaching sky-high valuations, tech companies the world over have seen the worst year of their lives amid surging inflation and interest rate hikes. Many are cutting jobs, and shutting parts of their operations to shore up balance sheers ahead of a potential recession".

So, was this status of "Unicorn" really worth it, except for the purpose of raising funds at astronomical valuations?

Some thoughts:

1. It's now time to relook at entire strategy adopted by some of such start-ups. From "fastest growth any cost", the paradigm shift should be - achieving "USPs" or "Unfair advantages" at "slow and steady pace", akin to the fable of hare and tortoise,

2. The headcount strategy should be based on "1-2-3" principle. That is, hire one, pay him or her the market level compensation of two, and assign responsibilities of three. That such a strategy would lead to better development of human resources, better motivational levels and lesser turnover, thereby positively benefitting the organizations as a whole in many way, is anyone's guess. Of course, this strategy needs to be supplemented with due care of the possible "burn-out" issues and need to rejuvenate the energy levels of their headcounts, and

3. The VCs etc who decide to finance such start-ups need to adopt a "three-legged race" mindset vis-a-vis their investee companies. They need to extend all possible support, besides being glued to their operational matters without any undue interference, so that they can offer constructive suggestions based upon their vast experience. That such a mindset would ultimately enable them (VCs etc), to realize superlative returns from their investee start-ups, is anyone's guess.

Strategic alliance between airlines, leading hotel chains, and multiplexes:

Two news items caught my attention.

 

1. Indian carriers, both low-cost and full-service, are revising their in-flight menus to offer passengers a differentiated fare, as competition is heating up amid the boom in air travel with the waning of Covid 19. The need has been felt by such carriers, to differentiate in services like meals, enhance ancillary revenue, and create a distinct space in flyer’s minds, and

 

2. Theatre chains typically get 50-60% of their revenue from ticket sales, and the rest from F&B and advertising. There may be months when no film works. Globally then, F&B and advertising helps de-risk the business. With this in mind, most of the biggies in cinema exhibition business have been investing in food variety long before the pandemic. Further, the need for premium experience for the movie goers at Multiplexes has also created a need for an upward push on F&B spends, which have shown a rise of 20 to 50% across the business. For almost three years now, the 702 screen Inox has had a tie-up with ITC’s ready-to-eat, gourmet brand, “Kitchens of India”. Since the pandemic began, PVR and Inox among others have been retailing their food on Swiggy and Zomato. And over the last eight months Inox has been doing a lot of culinary sessions with expert chefs in their properties. The idea is to convince people that multiplexes can do gourmet food. This in turn has helped F&B revenues.

 

Clearly, these two news items indicate the possibility of a promising strategic alliance between airlines, leading hotel chains which boast of distinct F&B offerings, and multiplexes, with each alliance partner leveraging its respective core competencies, to provide a combined value proposition to their respective target audiences.

 

Besides, exploiting the tremendous opportunities for cross-selling, such alliance partners can also leverage their respective analytics capabilities, and share with each other the insights gained on the perceptions and expectations of their respective target audiences. The attendant benefits would be obvious.