Best Practices for Crisis Management in Startups

I've been managing PR for the fastest-growing startups for over 12 years. 8 of the most valuable hacks we use for our clients (that you can use today): 𝗣𝗿𝗲𝗲𝗺𝗽𝘁𝗶𝘃𝗲 𝗖𝗿𝗶𝘀𝗶𝘀 𝗠𝗮𝗽𝗽𝗶𝗻𝗴 • Regularly brainstorm potential brand vulnerabilities • Develop responsive strategies Mapping these out lets you act fast when challenges arise. Anticipation is your first line of defense. With it, you're not reactive. You're two steps ahead. 𝗣𝘂𝗹𝘀𝗲 𝗼𝗻 𝗣𝘂𝗯𝗹𝗶𝗰 𝗦𝗲𝗻𝘁𝗶𝗺𝗲𝗻𝘁 In today's digital world, perception shifts rapidly. Harness sentiment analysis tools to constantly monitor your brand's digital perception. The earlier you spot a shift, the quicker you can intervene. Real-time insights can save reputations. 𝗥𝗲𝗶𝗻𝗳𝗼𝗿𝗰𝗲𝗱 𝗦𝗽𝗼𝗸𝗲𝘀𝗽𝗲𝗿𝘀𝗼𝗻 𝗧𝗿𝗮𝗶𝗻𝗶𝗻𝗴 A brand's voice can be its downfall or saving grace during crises. Train your founders, train your key staff. Implement media training focused on crisis communication. Prepared spokespeople control narratives — even in chaos. 𝗖𝗮𝗻𝗰𝗲𝗹 𝗖𝘂𝗹𝘁𝘂𝗿𝗲 𝗦𝗵𝗶𝗲𝗹𝗱𝗶𝗻𝗴 Society's sensitivities can change fast. Engage in social listening exercises to stay informed. • Understand the shifts • Identify potential pitfalls • Address areas of concern Don't fear cancel culture – move in harmony with societal changes. 𝗧𝗿𝗮𝗻𝘀𝗽𝗮𝗿𝗲𝗻𝘁 𝗖𝗼𝗺𝗺𝘂𝗻𝗶𝗰𝗮𝘁𝗶𝗼𝗻 Prioritize open, honest communication — especially during crises. • Admit errors and outline actionable steps • Release detailed, regular updates • Address rumors head-on Transparency fosters trust. It can mitigate potential backlash. 𝗖𝗿𝗶𝘀𝗶𝘀 𝗥𝗲𝘀𝗽𝗼𝗻𝘀𝗲 𝗧𝗼𝗼𝗹𝗸𝗶𝘁 A PR Swiss Army Knife — your key to survival during crises. Maintain an updated set of: • Contacts • Pre-approved messages • Action plans for various scenarios When pressure mounts, this toolkit is your lifeline for well-executed crisis management. 𝗣𝗿𝗼𝗮𝗰𝘁𝗶𝘃𝗲 𝗔𝗽𝗼𝗹𝗼𝗴𝘆 𝗣𝗿𝗼𝘁𝗼𝗰𝗼𝗹𝘀 Mistakes happen. Design a framework for public apologies, ensuring they're: • Timely • Genuine • Appropriate A heartfelt apology can go a long way in damage control and brand rehabilitation. It elevates brand stature in the public eye. 𝗖𝗼𝗻𝘁𝗶𝗻𝘂𝗼𝘂𝘀 𝗟𝗲𝗮𝗿𝗻𝗶𝗻𝗴 & 𝗔𝗱𝗮𝗽𝘁𝗮𝘁𝗶𝗼𝗻 After any PR challenge, conduct a thorough post-mortem analysis: • Understand the issue • Refine your strategies • Strengthen defenses Past challenges hold valuable lessons. Use them to navigate future threats. Don't drop the ball. Enjoyed this? You’ll love my newsletter where I talk about strategic communication, crisis management and public affairs: https://lnkd.in/g8MF5-6g

Crisis Mode. About to Miss Payroll. Leadership didn’t flinch. They knew what to do. Getting Clear on the Problem: A small SaaS bootstrapped startup suddenly couldn’t make payroll. After averting immediate catastrophe, they checked financials and found cash reserves had plummeted by 80% in one quarter. The CEO set a 90-day goal: restore cash levels to cover 3 months runway. The Right People: She gathered folks from finance, sales, accounts receivable, and product teams, all influencing cash flow. Their metrics expertise was critical to diagnose gaps. Connecting the Dots: Together, they mapped out key cash flow process stages: customer acquisition, billing, collection cycles, and reserve management. Sales and AR analyzed trends at each point. Zeroing In: The data exposed an obvious contender - DSO (Days Sales Outstanding) had doubled! Customers were taking 65 days on average to pay bills. The CEO reflected on recent client complaints about a buggy new feature. The 5 Whys: They wondered why DSO spiked. They found that the increase coincided with a major feature release. Why? A feature was released that finance expected to accelerate payments, but it had the opposite effect. Why? Customer research suggested that it had a confusing UI preventing invoice access instead. Why? The Root Cause: Product didn't vet the billing feature with customers to align UX. Dev prioritized speed over certainty. The result? Customers delayed payments due to inaccessible invoices stacking up. Testing and Validating: They ran a quick beta test fixing UI. Testers completed tasks 60% faster. Further, a staged roll-out validated feature stability with no complaints. Implementing the Solution: With clear data on feature usage and impact, they could release an improved version, solving customer needs. Cash flow was restored in under 90 days. Lessons Learned: Facing any business crisis, forcing clarity on specific goals and metrics provides focus. Assemble experts in relevant domains to dig into performance trends. Map out process touchpoints between teams to catch where assumptions caused the failure. Ask "why" - looking beyond symptoms to root causes. Ground solutions in customer experience. There is a method to solving any problem. Don’t panic, you got this.

Stress testing isn’t just for banks. Smart startups do it too. Here is HOW. In my 12+ years as a CEO and sitting in investor rooms, one thing is clear: Resilience beats optimism every time. Founders love to talk about upside. But investors want to know how you’ll survive the downside. ➟ What happens if your biggest customer churns tomorrow? ➟ Can your team handle a 3-month cash crunch? ➟ What’s your move if your supplier vanishes overnight? The best founders walk in with answers. They’ve already run the stress test. ➟ Financial runway under pressure ➟ Burn rate in a no-revenue month ➟ Key-person risk and team redundancy ➟ Backup suppliers and fulfillment plans It’s all about preparation. Here’s what real startup resilience looks like: • Real-world scenarios, not just theoretical slides • Emotional readiness at the leadership level • Systems that flex and adapt under pressure • Thought processes that anticipate investor concerns • Lean operations with liquidity buffers • Clear team alignment in a crisis • Defined emergency roles and decisions • No single points of failure • Plans built around contingencies • Confidence rooted in rehearsed execution 10 lessons I’ve learned from founders who plan for the worst (including me): 1. Plan a scenario before fundraising ↳ When the questions come, they already have answers 2. Know your downside, like your ARR ↳ Growth is sexy, but survival is strategic 3. Test team capacity under duress ↳ Crisis reveals real leadership structure 4. Build break-glass plans ↳ Not if, but when things go sideways 5. Stress-test supply chains ↳ Multiple vendors, local options, fast pivots 6. Normalize hard conversations early ↳ So when it’s tough, it’s not new 7. Train emotional endurance ↳ Calm heads beat spreadsheets every time 8. Keep cash sacred ↳ It’s not the runway. It’s resilience fuel 9. Rehearse investor crisis Q&A ↳ Confidence comes from preparation, not polish 10. Turn fear into foresight ↳ Uncertainty becomes a competitive edge The best decks prove durability. Don't have a Plan B? Comment or DM me. We'll figure it out together. ----------------------------------------- 💯 Want to qualify for VC funding? Take your free Fundraising Gap Analysis Scorecard. The link is on my profile page - Leon Eisen, PhD

In 2011, the Amazon Appstore failed on launch and Jeff Bezos was furious. It was my fault, and I handled one aspect of recovery so poorly that one of my engineers quit. I still regret it 14 years later. Please learn from my mistake. The main lesson is that when you are leading through a crisis, it can feel like it is all about you. It isn’t. It is about: 1) Solving the problem 2) Guiding your team through it The product issue was that there were some pretty simple bugs, and we solved those problem well enough that I was eventually promoted. Where I failed was in guiding my team through the crisis. My leadership miss was that I neglected to encourage and support the engineer who had written the bad code. He did a great job stepping up and supporting the effort to fix the problem, but shortly afterward, he resigned. During the crisis, I failed to make clear to him that we did not blame him for the launch failure despite the bugs. I imagine that left room for him to think we blamed him or that he didn’t belong. It is also possible that others did blame him directly and that I was too caught up in the crisis to realize it. Both instances were my responsibility as the leader of the team. His resignation taught me a valuable lesson about leading through a crisis: No matter how bad the situation is, your team must be your first priority. If you make them feel safe, they will move heaven and earth to fix the problem. If you don’t, they may still fix the problem, but the team itself will never be the same. As a leader, here is how you can give them what they need: 1) Take the blame and do not allow others to be blamed. In some bug cases after this we did not release the name of the engineer outside the team in order to protect them from judgment or blame. 2) Separate fixing the problem from figuring out why it happened. Once the problem is fixed, you can focus on root-causing. This lowers the risk of searching for answers getting confused with searching for someone to blame. 3) Realize that anyone involved in the problem already feels bad. High performers know when they have fallen short and let their team down. As a leader you have to show them the path to growth and success after the crisis. They do not need to be beaten up on- they have taken care of that themselves. 4) See crises and problems as growth opportunities, not personal flaws. Your team comes with you in a crisis whether you like it or not, so you might as well come out stronger on the other side. As a leader, the responsibility for a crisis is yours in two ways: The problem itself and the effect it has on the future of the team. Don’t get too caught up in the first to think about the second. Readers- Has your team survived a crisis? How did you handle it?

Most leaders waste their biggest growth opportunities. Here's what I learned after studying 200+ crisis responses across $50B+ in market cap... Everyone talks about "crisis management." But elite leaders? They focus on crisis EXTRACTION. The difference is everything. After tracking Fortune 500 CEOs, military commanders, and unicorn founders, here's the pattern: They treat every crisis like a million-dollar MBA program. 1️⃣ The Crisis Value Extraction Framework Within 72 Hours: → Structured debrief sessions (not blame meetings) → Data collection while memories are fresh → Cross-functional perspective gathering The 4-Layer Analysis: → What happened? (Facts without interpretation) → Why did it happen? (Root causes, not symptoms) → What worked? (Strengths to amplify) → What's the opportunity? (Strategic advantages gained) Most leaders skip layer 4. That's where the real value lives. 2️⃣ The Johnson & Johnson Playbook 1982 Tylenol crisis 7 deaths, brand nearly destroyed. CEO James Burke's response? Immediate debriefs across every level. Not to assign blame. To extract systematic improvements. Result: → Tamper-proof packaging industry standard → Crisis communication benchmark → Sales rebounded within 12 months → Trust metrics higher than pre-crisis The crisis became their competitive moat. 3️⃣ Why 90% of Crisis Debriefs Fail Fatal Error #1: Waiting too long Memory fades. Lessons evaporate. Fatal Error #2: Focusing on blame Elite teams ask: "What systems failed?" Fatal Error #3: Surface-level analysis Winners drill down: "Which communication channels failed under stress?" Fatal Error #4: No implementation tracking Insights without execution = expensive therapy sessions. 4️⃣ The $5 Billion Zoom Lesson COVID hits. Zoom usage explodes 30x overnight. Servers crash. Security issues emerge. CEO Eric Yuan's response? Daily crisis debriefs with every department. Not damage control meetings. EXTRACTION sessions. Questions they asked: → Which assumptions broke first? → What capabilities did we discover? → How did customer behavior shift? → What market gaps opened? Result: Zoom captured 70% market share and built the hybrid work infrastructure powering today's economy. The crisis became their category-defining moment. Because here's what most miss: Your competitors face the same crises. The question isn't whether you'll face disruption. It's whether you'll extract more value from it than they will. Elite leaders don't avoid crises. They architect systems to profit from them. In a world where change is the only constant... The fastest learners win. === 👉 What's the biggest crisis your organization faced recently - and what systematic advantage did you extract from it? ♻️ Kindly repost to share with your network 💌 Join our our newsletter for premium VIP insights. Link in the comments.