Keep Calm & Communicate Well

After the recent SVB rollercoaster and witnessing many founders excel at crisis communication (you know who you are), I reflected on the key components of what makes"crisis" communication great.

To me, the three most important pillars throughout challenging times are proactivity, transparency and clarity.

Here’s why:

Proactivity:

Proactive communication amid significant uncertainty is a make or break as it allows you to:

• Control the message and shape the narrative before others have a chance
• Address concerns early to prevent unnecessary escalation
• Minimize panic
• Build trust and confidence with stakeholders

On the flip side, letting a crisis linger, whether large or small, can lead to it spiraling out of control. Delaying communication with stakeholders erodes trust and confidence, even if you have matters under control. Silence is always received as a negative and concerning signal.

Quickly sending a simple message puts minds at ease and buys time to figure out a game plan as you seem in control (even if you’re not).

And remember, proactive communication also includes providing regular updates and responding swiftly to stakeholder questions / comments.

Transparency:

When communicating, provide the transparency needed to put people’s minds at ease:

• Give them all known facts upfront - complete information from the get go lands much better vs “drip feeding” bad news over time / multiple updates
• Recognize and acknowledge gaps in information; otherwise, stakeholders may wonder why they were omitted
• Avoid sugarcoating, it’ll come out

A good initial message in the case of the SVB meltdown could have been:

The facts: Our exposure to SVB is $ X, our cash balance elsewhere is $ Y and our monthly burn is $ Z.

What we’re doing about it: We initiated a wire at xx.xx h today but haven’t received confirmation it went through yet. We’ll continue trying and are working on a Plan B in case the wire doesn’t clear.

We are all hands on deck and will keep you posted as we learn more. If you have comments / questions, text / call me any time at xxx-xxx-xxxx.

As a crisis persists, stakeholders will expect more commentary and transparency regarding next steps.

Clarity:

Last but not least - your communication has to be clear and concise:

• Avoid jargon or technical language; it doesn't make you seem more knowledgeable or in control
• Refrain from speculating on potential outcomes; focus on known information and a Plan B (if available)
• Keep messages short and simple to prevent key messages from being lost in too much detail

The most effective updates use plain language and provide context to help stakeholders better understand the situation in the simplest way possible.

To sum it up:

Many books / articles have been written about crisis communication as there are many nuances to it. However, when 💩 hits the fan, you’re unlikely to have time to revisit it all. Focusing on the three pillars discussed should put you in a good place.

Lastly, I wanted to touch upon that you go through smaller and larger crisis almost daily in startup land. While it's essential to communicate effectively, not every (perceived) crisis warrants stakeholder communication to avoid overwhelming them.

I can’t tell you what meets the threshold of an event worthy of stakeholder crisis communication. But whenever you do decide an event is above the threshold, remember:

Proactivity, transparency and clarity.

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