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5 Ways to Prepare for Disaster in a Startup Disaster seems to lurk around every corner, and no matter how hard you try to prepare yourself, there's seemingly always something waiting to take your company out.

Edited by Dan Bova


Startups are volatile. Prone to unexpected fluctuations in consumer interest, undocumented workflows, rising competitors and a myriad of financial complications, it's no wonder why the majority of startups end up failing, even though so many start out with such promising ideas.

Disaster seems to lurk around every corner, and no matter how hard you try to prepare yourself, there's seemingly always something waiting to take your company out.

Some people see entrepreneurs as visionaries, as directors or as charismatic leaders. While they certainly can be all those things, I tend to see them more as disaster preparedness experts. Entrepreneurs who prepare better and respond better to disasters have the greatest track record of nurturing their businesses to success -- regardless of those other roles.

Related: 4 Tips for Mentally Preparing for Overwhelming Challenges

If you want to protect your business as much as possible, use these five preparation strategies:

1. Read the news.

Reading the news can help you prepare for any number of potential disasters. You might learn that an economic downturn is forcing medium-sized business owners to curtail their marketing spending, allowing you to adjust your strategy accordingly. You might learn that a new competitor is emerging, giving you the chance to respond with a new approach. You might even learn of a new technology that could disrupt your current operations, giving you the chance to prepare for the shift.

Depending on your preferences, you can set up a blog reader that aggregates all your industry and news sources into one location, or use social media lists to organize yourself. Either way, make sure you dedicate a little time each day to catch up on the latest current events.

2. Create a plan B for everything.

When a plan fails, you'll want a plan B to back it up. Get stuck without one, and there's a major opportunity for disaster to strike.

No matter how big or how small your aspirations are, create a companion plan B to everything you create or direct. For example, in your business plan you can outline a contingency plan if your initial launch doesn't meet your expected sales figures. In your marketing campaign, you can list a handful of alternative channels to try should your primary target prove ineffective.

Drill this mentality into your team members and employees as well. Force them to get into the habit of developing plan B's for everything they conceptualize.

3. Estimate everything conservatively.

As a general rule of thumb, your estimates should not be what you expect to see. They should be a watered-down version of what you expect to see.

Related: Are You Prepared for That Cliff That Could Be Further Down the Road?

If you genuinely expect to see $400,000 in sales your first year of operations, write it down as $350,000. If you expect to have your product ready to launch in 10 weeks, prepare your investors for a launch date in 12 weeks. If you think it will take an hour to do something, schedule an hour and a half.

This conservative approach to estimating will save you a lot of time and headaches.

4. Establish redundancy in your processes.

One of the most painful processes for startups is formally documenting all policies and procedures, but it's important if you want your operations to run smoothly no matter what.

For example, you probably only have one person working in each "department" of your small operation. What happens if one gets sick for a week, or decides to quit unexpectedly? Who takes the reins and how do they do it? What's your plan if one of your most important pieces of equipment goes down due to technical issues?

You need to have clear, redundant contingencies outlined in all your formal processes.

5. Realize that you will be blindsided.

One of the best strategies in disaster preparedness has nothing to do with creating something and everything to do with thinking a certain way. Prepare yourself for the fact that one day, and perhaps many days, you will be blindsided by a disaster that you didn't see coming.

Somehow, your insights, estimations, contingencies and redundancies will all fall through and you'll be hit by something terrible that compromises your business. It is an inevitability. Accepting that this is an inevitability, and that it can be worked through, will help you address the problem calmly, confidently and sensibly.

With these strategies in place, you should be able to prevent or mitigate the majority of disasters that can (and will) strike your business. This is no guarantee that your business will survive, but it will increase your chances, especially compared to someone without a preparation or recovery plan. Get your team involved, and make it clear that your business will not succumb to disaster -- at least not without a fight.

Related: 5 Common Entrepreneurial Mistakes There Is No Excuse for Repeating

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