Founders don’t get the luxury of calm waters.
The world throws storms, and our job is to sail through and still find new harbours.
The latest wave is particularly heavy. The U.S. has piled on steep tariffs for imports from multiple countries, slapped a $100,000 fee on each H-1B visa, and is even debating a 50% tax on offshored work. For Indian IT outsourcing, which built its scale on affordable cross-border talent, this is the toughest challenge since its birth. Added to these are sizable pressures from Generative AI automating coding, testing, and support.
And just when we need steady hands, Gen-Z managers, who have never seen a serious downturn, are stepping into middle management.
This is not only about Indian IT services.
The shock will ripple into allied industries, global startups, and every enterprise IT department that depends on talent from India. With fewer engineers available, projects to adopt AI or modernise technology will slow down. Innovation across industries will feel the pinch. Tariffs will also raise costs for hardware and software imports, hurting startups that depend on global supply chains to deliver to customers.
But history reminds us: Downturns create openings, and survival is only the first half of the game.
The second half is how you prepare your company to leap forward once the clouds clear.
Of course, these restructuring and growth plans may sound good on paper, but the immediate reality is often brutal. For many founders, simply surviving to see tomorrow will test every ounce of mental strength. The stress rests squarely on the founder’s shoulders, where the ultimate buck stops. If your company is carrying debt, any move becomes even harder. Sometimes the right call is to take fresh capital at a lower valuation, or even sell to a strategic buyer.
I went through this myself during the aftermath of the 2008 subprime crisis; debt servicing then was the most difficult period of my career.
These strains also ripple far beyond the boardroom. Employees feel the pain, yes, but so do families. As a founder, you cannot leave your immediate family in the dark. You need their moral support to get through the turbulence, and you need to share the journey with them. Don’t underestimate this — resilience is not built in isolation.
So what can founders do?
One, retrain your talent map.
A crisis forces everyone to pay attention. When external shocks hit — tariffs, visa fees, offshoring taxes, or AI taking over routine work — even the most change-resistant teams realise the old ways won’t hold. This is the best time to shake up how your organisation is structured. Companies that use downturns to reskill their talent, upskill managers, and rewire processes often emerge leaner, sharper, and more loyal to the mission. In the long run, investors get stronger returns, employees gain future-proof careers, and the company earns resilience it wouldn’t have built in calmer times.
Two, experiment with new markets.
Many boards say no to risky adjacencies when times are good. In a crisis, you get a free pass to test them. Airbnb started by renting out airbeds to strangers — an odd experiment in a downturn that grew into a $30 billion travel company. What market can you test now that would have been rejected in normal times? Boards and teams accept hard changes in a crisis that they resist in normal times — use that consent wisely.
Three, invest in R&D and talent.
Crises change the cost–benefit math. The projects your board once dismissed as “too risky” or “low returns” — experimental products, AI-driven tools, or bold market pivots — suddenly become essential for survival. Remember how cloud computing looked like a distraction in the 2000s, until companies that embraced it early pulled ahead? The same will be true with Generative AI and automation. Use this period to hire the best engineers and talented researchers who may not be available in normal times, and give them the mandate to work on bets that shape the next decade. In downturns, survival is not about holding ground; it is about creating the breakthroughs that make you indispensable when the market rebounds.
Four, raise capital with courage.
Funding may look tight, but investors always have dry powder for bold founders. If you can show you are steady and preparing for growth, you will find money. In 2009, a number of Indian SaaS firms quietly raised bridge rounds in the middle of the slowdown — that capital later fuelled their expansion into the U.S. market. Other deal terms may also be better in downturns than when valuations are inflated in good times.
Five, expand your circle.
When it was business as usual, founders barely had time to look up from their own companies. In a slowdown, the pace of business eases. Use this to get out of your bubble. Attend industry events, participate in community forums, network with peers, and exchange notes. You’ll learn how others are tackling the same challenges, and sometimes, a single conversation can spark a new path for your business.
And don’t forget leadership. Crises test not just business models, but people.Gen-Z managers stepping into middle roles today have never lived through the dotcom bust of 2001 or the financial meltdown of 2008. Their instincts are untested in turbulence.
This is where the founder’s role as mentor becomes non-negotiable.
In my book, The Founder Catalyst, I wrote that “every founder needs a mentor — and every founder must also be one.”
Your role is to model calm under pressure and guide managers on handling stalled clients, shifting projects, and keeping teams motivated. Involve them in tough calls and investor discussions — the resilience they gain now will shape your company’s culture for years. And remember, even founders need mentors during turbulence; clarity is easier when you are not carrying the storm alone.
Every crisis feels like the deadliest when you’re inside it. Ask those who survived before — they thought the same. Microsoft was born in a recession. So were Airbnb and Uber. What mattered was that the founders didn’t waste their crisis.
So, founders, don’t just cut expenses. Use the turbulence. Expand into spaces adjacent to your core. Enter markets that earlier seemed out of reach. Hire the talent others are letting go. Turn your company from a survivor into a growth engine.
As I often remind myself — the role of a founder is not to predict the storm, but to prepare the ship.
Founder Catalyst is a no-nonsense guide for startup founders who want to become decisive, authentic CEOs—without losing their soul along the way.
Grab your copy here: https://mybook.to/foundercatalyst
