The new coronavirus has become not just a large-scale problem, but a messenger of the long-term global crisis. For this, it only took a few weeks. We can face fundamental changes in people's behavior patterns — economic, social, and political. Now it is essential for all of us not only to understand that the world will no longer be the same but to be able to adapt to the new reality as quickly as possible. This can be done, among other things, by accelerated integration of modern technologies and business models.
Experts agree that coronavirus will be the most expensive epidemic of the 21st century. Bloomberg warns that if the situation develops according to an adverse scenario, global growth following the results of 2020 will be equal to zero. In monetary terms, the damage to the world economy will amount to $2.7 trillion. According to the report of McKinsey, if the seasonality of the virus is not confirmed, the global economic growth in 2020 will drop to the range of 0.5–1.5%.
However, it is important to assess not the economic consequences of the epidemic but to realize that the “black swans” like coronavirus can appear more often. The damage from uncontrolled natural and climatic emergencies will only grow. And who will give us guarantees that having coped with the consequences of COVID-19, very shortly we will not face a new, even larger-scale epidemic or catastrophe? Therefore, the most vulnerable areas of our business require innovation and investment instead.
However, any crisis is always a new chance. Atypical pneumonia has spurred the Chinese Internet boom. During the epidemic, the streets of China were empty; people tried to minimize any contacts. The Alibaba team saw the potential in this unfavorable situation and used it correctly. The idea turned into Taobao which today serves over 330 million online shoppers.
During the crash of dotcoms, Google was a young Internet company that offered the market a radically new product — a search engine with friendly interface and unique algorithm for displaying search results. This attracted customers and investors to the company even during the crisis. Amazon could survive the spring of 2000 and even had grown thanks to an atypical business model: the company invested all the profits in its development. Despite the collapse of stocks, Amazon had an airbag that allowed it to spend money on mergers and acquisitions.
In the context of the emergence of new opportunities, the 2020 crisis is similar to the previous ones. Seriously disrupting our offline communications, it will accelerate the digital transformation. Today, the focus is on everything that simplifies remote interaction and helps to cope with an emergency. Learning goes online everywhere. Although resourceful Chinese schoolchildren, massively underestimating the ratings of online applications, are trying to sabotage this process. Medical chatbots help to diagnose symptoms of the virus. A patient in the USA receives help and medical control through a special robot; food and medicines can be delivered to quarantine zones by drones. These projects are in demand now.
Artificial intelligence technologies will provide serious support in a situation of constant changes in external parameters and factors affecting the supply chain. For example, data analysis using AI enables the supplier of disposable masks not only to satisfy uneven demand in conditions when the consumer sweeps them off the shelves in all stores but also to ensure the availability of goods in hospitals where it is crucial.
Shortly, we can expect the growth of start-ups to solve the problem of transferring all the aspects of non-productive work processes online. In Los Angeles, a project that provides and organizes remote jobs is gaining momentum. According to its founder, everyone understood that “over the next 5–10 years, the idea of how to conduct office work will change.” But no one imagined that the situation would change so quickly. In conditions of forced isolation, the demand for products that will allow people to maintain the quality of life will increase. For example, should be expected new solutions in the field of home entertainment. An additional incentive will be given to the development of technologies for ensuring data exchange and storage security. In the new world of teleconferencing and telecommuting, such services are becoming the most demanded.
Do not think that the strongest will best overcome the crisis. It's good to be keen to deal with the problem, but it's pointless in the fight against the new reality. Therefore, the well-known American Sequoia Capital venture fund has now reminded investors of the ever-relevant thesis of Charles Darwin:
By: Mikhail Fedotov, venture investment expert.