The Impact of Lockdown on Start-Ups, with Anthony Rose, CEO of SeedLegals
In this article, qLegal students Sally, Sara and Zoë explore how recent financial challenges have impacted start-ups in the UK. To gain an inside perspective, they met with Anthony Rose, the CEO and co-founder of SeedLegals.
The ongoing Covid-19 pandemic has had a devastating impact on the lives of many. Almost a year on from the initial outbreak in Wuhan, China, more than 1.5 million lives have been lost. A few weeks ago, members of the qLegal team sat down (albeit virtually) with Anthony Rose, the CEO and co-founder of SeedLegals. SeedLegals is a digital platform based in London that allows founders and investors to use automated legal services for their start-ups, reducing the cost and time associated with funding rounds. We met up with Anthony to find out how the virus has impacted his business and, more broadly, how the virus has impacted start-ups in the UK.
The past year has been financially challenging across the globe and in all sectors. Interestingly, SeedLegals has gone from strength to strength, growing the team by 60% and more than doubling annual gross profit. Anthony explained that “it’s all about the company rapidly taking advantage of things”, advising founders of start-ups who are struggling through the pandemic to “redefine your business based on whatever the situation is”. For example, after the government’s Furlough Scheme was rolled out, SeedLegals recognised that people would be looking online for more information and quickly met this demand by publishing articles and creating a free set of furlough documents. As a result, the platform saw a 400% increase in web traffic. With such growth, Anthony’s main concern about his business is that the team will no longer be able to fit in the office, but perhaps working from home will continue into the future.
“Redefine your business based on whatever the situation is” — Anthony Rose
SeedLegals was initially worried about investors getting cold feet at the start of the pandemic, but the drop in funding rounds only lasted around a month or so and then picked up. With this current financial crisis hitting the global market, companies and enterprises have been downsizing as investments have been lost, however the crisis has in some ways positively impacted start-ups. As Anthony explained, “start-ups are renowned for having to be entrepreneurial, having to pivot, having to take advantage of situations” and SeedLegals has noticed a trend in companies reducing their marketing costs and spending on “core user experience, tech development and product people” instead.
This links back to what Anthony told us about founders redefining their businesses during these times and rapidly responding to change. He gave an example of a company that is using SeedLegals for a funding round. This company publishes travel guides and, in a time when nobody is travelling, they have cut costs. As Anthony described, “It’s not like we will never travel ever again, it’s the question of how many months. So if they can reduce their costs, focus on product development, rather than marketing in this period, then when people are travelling they’ll be in a strong position with a better product.
Anthony stressed the importance of a start-up having business fundamentals, concepts and models in place, rather than just raising money. This way, when times are bad, the company is more likely to survive. The second point he stressed was that “procrastination is death.” Just as SeedLegals was quick to act on the growing demand for furlough documents, start-ups must take action if they are to withstand difficulties.
“Procrastination is death.” — Anthony Rose
By the same reasoning, Anthony finds no reason to delay your own start-up because of the pandemic. He believes in being proactive and likes “to be somewhat counter-cyclical.” For example, Anthony explains that “it’s counter-cyclically easier to hire people when people are being let go”, which perhaps is the reason why SeedLegals has made so many hires in the last nine months.
As long as starting your own business would not risk you going bankrupt, the only factor he considers important in deciding whether or not to start-up is if you are ready to be a founder. Perhaps you need more experience or “maybe you just haven’t had the dream idea”. Even if you try and fail, yes you could have spent that time in another job or working on something else, but this is hardly a downside since “you get to spend some months of your life working on something that’s your passion”.
This article was written by Sara Akbari, Zoë Galasso and Sally MacDonald who are participating in qLegal as part of their Law Masters studies at Queen Mary, University of London. qLegal provides pro bono legal advice to start-ups and entrepreneurs on intellectual property, data protection, employment, corporate and commercial law. See the qLegal website for more details and to book your appointment now. Follow us on Twitter and LinkedIn for regular updates on issues relevant to your business.