It has not been a good year for the technology sector. At the time of writing, we’re experiencing what we call the tech winter.

Trillions of dollars of value have been erased from publicly listed tech giants such as Google, Meta and Amazon.

Globally, 1003 technology companies laid off over 152,000 employees this year, as per data from layoff.fyi, a platform collating data on firings by tech companies. This has surpassed the tech layoffs during the 2008-2009 recession.

I don’t think we are at the bottom of this yet. I do expect more startups to lay off and close down due to cash reserves running out. 

I have been following this closely since February. It matters to me as I am a tech worker who works in the SaaS sector. I also work with a lot of startups and venture capital firms in my day job. Tech winter impacts both myself and my customers.

In times of crisis, I always think about two things “How can I turn this into an opportunity?” and “How can I set myself up for long-term success?”

This is my game plan.

Have 12-18 months of emergency funds

Many startups have been advised to keep at least 24 months of runway to stay afloat during this period of time. The same applies to employees. We should be thinking about “If I lose my job tomorrow, how many months can I survive?”

During these times, it is important to have emergency funds. Here is how to calculate your emergency funds: Monthly expenses, including income tax, mortgage, insurance, etc. x 12 -18 months.

Emergency funds can be cash or short-term fixed deposits (six months), as long as the total sum adds up to 12-18 months within a year.

While some have chosen to only have a six-month buffer, I have personally chosen to keep a buffer of 12-18 months.

Firstly, we tend to underestimate how much we might spend. Unpredictable life situations could happen after we get laid off. We want to make sure we have ‘dry powder’ ready for circumstances like these.

Also, it is not wise to rush to get a new job. When you are desperately looking, you are in a worse position to negotiate and may even take a job that does not pay you as well. That may impact your future earnings.

Also Read: How to never waste a good a crisis and survive the recession

Having 12-18 months of emergency funds has given me a lot of psychological safety. If I were to be so unfortunate to be laid off, I know that I have a huge buffer to cushion the impact.

雪中送炭: Focus on impact

I am someone who pays attention to key trends, tries to anticipate them and constantly asks myself, “How can I 借东风? (Borrow the easterly winds)”.

This mindset is influenced by my Taoist beliefs 無為(wu wei). This means riding the wave of change, moving with it and not against it and making use of its tremendous power.

In February 2022, I chanced upon a deck by a growth stage founder. He shared that there has been >50 per cent compression in public SaaS multiples since Nov 2021. This will persist so long as inflation and interest rates remain high. He shared with his leadership team that it will be key to have a longer horizon for the use of funds.

I knew a storm was coming and gave a lot of thought about the implications on the industry and how I wanted to position myself.

There is this saying in mandarin 锦上添花易 , 雪中送炭难 which means it is easy to add flowers to a brocade but hard to deliver charcoal in the snow.

I wanted to not be a fair weathered friend who was only there during good times but rather to be the person who helps others in crisis. So, I started thinking about how I could adjust myself to add value and contribute to others during this period of time.

One of the key risks I took was to leave my previous company after only 10 months and join a new one which will empower me to bring more immediate value during the tech winter.

For the past few months, I’ve been able to deliver a huge impact to many of our customers via my job at Spot.io.

Many startups are doing great work by solving key problems in our society and improving the lives of their customers. If they fail during this winter, it will be a huge loss not only to the founders but also to everyone else.

By optimising and automating their cloud infrastructure, saving up to 60 per cent on compute costs, we’ve been able to help them free up budget and manpower, which they can dedicate to their strategic priorities.

Through this experience, I hope to add as much value as possible, save some peoples’ jobs, collect good karma and build lasting relationships.

If you are keen to reduce your SaaS spend and cloud infrastructure spending, please connect with me.

Deepen and build work relationships

Since February, I have been focused on building up existing industry relationships and building new ones. This was advice from one of my previous bosses and also a Bazi master, and it has worked out pretty well.

I started being super active in attending conferences, events and dinners. As I tend to do better in small groups, I have also been reaching out to interesting people on LinkedIn to ask them to meet and organise my own events.

I have also made it a point to talk to every recruiter who calls my mobile, even though I am not looking for a new job now. I would try to point them in the right direction by matching them with a friend who is looking. The idea is to build two relationships – with the recruiter and also with the person I am helping.

Meeting new people and building relationships in the industry is still quite an intimidating process for me. This is especially so in an industry that is so male-dominated.

I still face self-doubt, feel shy at times and wonder if people might sometimes take advantage of my generosity and trusting nature.

However, I gradually learned there is a lot I cannot control, so I can only focus on my attitude. These are the principles I will abide by:

• 诚信赢天下: There is no direct translation for 诚信, and the idea is to treat others with sincerity, honesty, gratitude and in good faith. A relationship has value only if it is genuine. I try to be vulnerable first, show up authentically, give first and open my heart. I hope that others can be real and sincere to me in return.
• Think win-win and long term: Try to add value to others also by sharing knowledge, budget, and making introductions and resources. Sometimes, people may not be kind to us or able to help us at all because of various factors such as level of maturity or that they are going through a bad time in their own lives. Have empathy, extend your hand to help first and think long-term.
• Increase your surface area of luck: Each new person you meet expands your luck surface area. Several new connections I made were made through cold emails, and taking the first step to connect at parties and conferences. Like attracts like. If you have similar values as others, they will connect you with other like-minded folks. That is how you build your tribe.

Upskill, upskill, upskill

I listened to a podcast during the COVID-19 period, and one of Zenyum’s Co-Founder shared a quote I still remember today: “When Fishermen cannot go out to sea, they repair their nets”.

Also Read: How NFTs are surviving and prospering in the bear market

The idea here is to double down and focus on your growth and learning.

Here is what I did in 2022:

• In my new role, I had to work with a lot of VCs and growth equity companies. I took a course on venture capital so I could learn how they think, how to speak their language and how to add value to the partners I work with.

• I also doubled down on my core skill set by learning from one of Salesforce’s top-performing individual contributors.

• To prepare for my next step, I also spoke with several SaaS leaders to learn about leadership principles, hiring, running a team, building a GTM strategy, etc.

• When I come across interesting books, concepts and ideas, I would share them on my Instagram, LinkedIn and newsletter.

I have yet to define a learning agenda for the first half of 2023. This will involve reflecting on my 2023 priorities and identifying potential gaps.

Invest consistently

Topics like fixed deposits and savings bonds are increasingly popular in personal finance. I see them covered extensively by many creators and publications.

However, if one neglects equities now, it could be a missed opportunity. After all, recessions do not last forever. I’ve been through a bear market in 2018, March 2020 and again in 2022.

Each time when I look back, I wish I had invested more. Thus, I know that the best time to invest is now.

I keep the advice from Warren Buffet and Charlies Munger close to my heart: “Be greedy when other people are fearful” and “The first rule of compounding: Never interrupt it unnecessarily”.

As tech stock values plunged throughout the year, private equity firms such as Thoma Bravo began hunting to acquire smaller ones. They saw companies with lots of upsides being vastly undervalued in the brutal market conditions of 2022.

During this period, I did not reduce my position and instead continued to invest consistently in companies in my portfolio, S&P 500, funds and unit trusts.

I also started learning more about alternative investments and private markets in late 2022. This is an area I wish to continue learning more about in 2023.

We cannot change a lot of things which happen. However, we can take steps to prepare ourselves for it. What I feel is important is not just taking steps to prepare ourselves for the crisis but also maintaining conviction in the path we’ve chosen for ourselves.

Despite the winter, I am still really bullish on the tech sector and Southeast Asia. I believe in the long-term growth of this industry and this market and will continue to build my career on it.

This is not the first bear market or tech winter that the industry can see. Neither will it be our last. There could be worse ones in the future to come even after we recover from this.

This is an opportunity to build resilience, adaptability and maximise what gains we can get from it.

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Image credit: Jeraldine Phneah

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