4 ways Houston businesses can recover cash flow in a post-COVID world

Guest column

There's no quick fix to getting back to where you were, but a keen eye and sensible decision-making will ensure you're more prepared than your competitors. Photo via Unsplash

The COVID-19 pandemic has been a cash flow disaster for many businesses, whether it's small restaurants forced to close their doors for months on end or commercial rental properties unable to fill their office space in light of widespread remote working.

Houston, much like many major US cities is facing a big recovery job as the country looks to move on from the worst of the pandemic. While much is to be determined when it comes to what the Delta varient's effect is, businesses are open and the time to think creatively about recovering cash flow is here.

In this article, we'll look at how Houston businesses can get over what was a huge shock and re-evaluate for a post-COVID world.

First things first: Assess the financial damage

Before you can begin to work on a strategy for recovery, your business first needs to assess the financial damage COVID-19 inflicted on it.

There are many different layers to this, which will become more important depending on the size of your business. Start by looking at the hard numbers that define your business (both pre and during the pandemic), such as:

  • Year profit
  • Yearly spend
  • Yearly losses (and expected losses)
  • Employee salaries

There's a chance things aren't quite as bad as you expected. You might have saved on office space through working remotely or have seen an uptick in online customers that represents a revenue shift. This may seem like basic business management, but in a situation such as this, it's easy to ignore the forest for the trees.

Once you've got these numbers in line, you can start to develop a rebuilding plan that relates entirely to your business, rather than cutting and pasting one from another business that is unlikely to have experienced the same issues.

Re-assess your business plan

Chances are, you didn't include a contingency option for a global pandemic in your business plan. No need to panic. If you made it this far, you were obviously a well-structured and organized business. However, to ensure you survive future challenges, it's worth re-assessing your business plan.

Specifically, you need to look at how ready your business is to pivot to the idea of the 'new normal'.

There are many decisions to be made, from top-level finances to employee management to customer service. You may be forced to implement new systems to keep track of your newly remote team, offer subsidies for utility bills to your staff or implement new quality control tests to keep your customers safe and comfortable with your business.

A wider analysis of your industry can be a more effective exercise than looking directly at your plan. Competitors may have innovated in ways you didn't initially think possible. Pay attention to trends and emerging opportunities to mark yourself as a business worth shopping for and working with. Find that profitable niche and see if your business plan can be re-worked around it.

Your business plan will lay bare your business model's strengths and weaknesses in the new world. Don't try and plough through difficult weather with the wrong tyres. Make a simple change, even if it means hard decisions, for the good of your company.

Optimize daily processes and cut out wasteful tasks 

So you've analyzed the damage and re-assessed your business plan for a new set of challenges. Now you can get into the gritty details of making a change.

One of the simplest and most cost-effective ways of getting your business running with a positive cash flow again is to optimize those wasteful daily processes and tasks you and your team get stuck on every day.

Of course, many of these will be unique to your industry and way of doing business, but from invoicing to daily admin tasks, there's so much wasted time every day that could be better spent getting your business back on track.

A few immediate suggestions include:

  • Cutting down on business travel by prioritising virtual meetings and re-thinking how your sales and executive staff travel. Even company cars can become less of a money burden if you take the time to know how to how to save gas (and the money you spend on it)
  • Going paperless and using that printer money to operate through cloud software won't just bring your business into the 21st century, but make daily meetings and employee collaboration more most-effective
  • Using financial trackers to assess your financial situation regularly and automate invoicing, making sure you're always getting paid on time

Monitoring all of this excess spend spillage and ensuring you're on top of emerging problems can be made very simple through time tracking tools. Rather than just a way to keep an eye on remote employees and cut out excessive slacking, Houston businesses can spot which needless tasks are making key employee's life difficult and where budget is being wasted through these (as of March 2020) essential digital tools

.

Consider outside funding options

Last year, we covered how creative thinking in terms of financing can be Houston businesses' path out of COVID financial burden. Since then, much has changed, but many of the methods remain realistic ways businesses of all sizes can recover cash flow.

Unless you went into the pandemic with significant cash to burn, you're likely playing things quite close to the line right now. Without customers through the door and big contracts, you might need working capital to jump-start your recovery.

Fortunately, some great financing options for small businesses have sprung up or gone from strength to strength throughout the COVID rebuilding period. Some of these options include:

Now, not all of these options will work for your business, particularly the ones aimed at small businesses. However, they're all reasonable ways of getting a short-term boost to buy remote office equipment, re-work your business for social distancing to avoid closures or bring in new employees.

The key is not to become reliant on these revenue streams. They should be short jabs to get your business going again, not a consistent fix you should turn to in the event of financial challenges. Borrowing can be both an unhealthy attitude to have and a competitive venture.

Completing these tasks will help you establish a timeline for recovery. No one is quite sure what their business will look like once COVID-19 is completely a thing of the past, but the pandemic should be a lesson that no business can be caught slacking.

The journey to recovery, particularly sorting out your cash flow is full of tiny steps. There's no quick fix to getting back to where you were, but a keen eye and sensible decision-making will ensure you're more prepared than your competitors.

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Kayleigh Alexandra is an entrepreneur and writer at WriterZone and Micro Startups based in the United Kingdom.

What does Houston's tech scene look like from an outsider's perspective? Ripe for success, according to this guest article. Getty Images

Non-Houstonian identifies why the Bayou City is prime for a tech and startup boom

Guest column

Houston might be known abroad as the Space City, but it's got a lot more to offer than interstellar exploration. As we continue toward the second half 2020 — even in light of the COVID-19 crisis, Houston is attracting the best talent, tech, and businesses around — and with good reason.

Here we look at why Houston is such an attractive prospect for enterprise in 2020.

More bang for your buck

While the likes of New York or Los Angeles are established places to launch and grow a business, they are expensive. But in Houston, your important dollar goes a long way.

The cost of living in Houston is around 35 percent lower than in New York. Consequently, cash-strapped but ambitious graduates flock to Houston to enjoy a better (and more affordable) quality of life.

For startups looking to gradually and sustainably grow in their first year (and succeed), Houston is an attractive place to start. They get more bang for their buck, so they can focus on growing their business without paying through the nose for expensive office space (and staff).

It's a beautiful, historic city

Founded in 1836, Houston has a long and rich history, and its aesthetics perfectly represents that — something Houstonians and Texans don't take enough time to recognize usually. Its architecture is a healthy mix of historic and modern.

Downtown Houston features gorgeous old buildings spreading out from Allen's Landing. Its residential architecture too offers some stunning mansions, as well as some rustic row houses. As the city developed throughout history, its skyline has grown to include some breathtaking skyscrapers, including the Heritage Plaza and the JPMorgan Chase Tower — one of the tallest composite buildings in the world.

Looking beyond architecture, Houston offers plenty of green spaces to enjoy. Hermann Park is an impressive 445 acres, and acts as a community space for the entire city. If you want somewhere to run a few miles before heading to work, Memorial Park offers plenty of open space and trails to take advantage of too.

Looks aren't everything, of course. But with the rich sprawl of Houston all around you, they certainly help.

There's a thriving coworking scene

Houston is home to dozens of stellar coworking spaces — with more opening regularly. There's a few WeWork outposts from the Galleria area to The Woodlands, as well as home-grown spaces like The Cannon, Station Houston, and Wicowork, where businesses from virtually every industry come together to work and collaborate.

These spaces form part of a thriving startup scene with plenty of scope for networking and collaborating. Growing a business is easier when you're doing it alongside others, and Houston's coworking spaces offer a fertile ground for meeting and sharing inspiration.

It's not all about established businesses either. Houston is also the perfect place for individuals to launch a creative side hustle, with a thriving scene of artistic self-starters and passionate solopreneurs available to draw upon for inspiration. These coworking spaces provide the perfect place to meet like-minded individuals and get your vision further.

Although COVID-19 has affected coworking spaces, the crisis has pushed coworking to provide virtual resources, which will only benefit coworkers across companies.

Choose from a great pool of talent

Every growing business needs the best and brightest talent to join its ranks and help it succeed. Thankfully, Houston is home to some of the finest universities in the state. The University of Houston and Rice University produce plenty of smart, driven graduates looking to make their mark on the chosen industry.

These universities also have a close relationship with local startups too. Each has its own startup accelerator to help small enterprises get ahead. UH's RED Labs has helped launch dozens of companies since its inception in 2013, and Rice University's OwlSpark has 54 startups to its name to date.

Consequently, plenty of businesses are looking to Houston to seek growth and attract top talent. With such a wide pool of talent on tap, startups and growing businesses alike will have their pick of the crop.

Everything's bigger in Texas, and Houston is no exception. With a growing pool of bright talent, a stellar startup scene, and beautiful surroundings to match, Houston is the top destination for talent and business in 2020.

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Kayleigh Alexandra is an entrepreneur and writer at WriterZone and Micro Startups based in the United Kingdom.

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Intuitive Machines strikes $49.3M deal to expand lunar communications network

space deal

Houston-based Intuitive Machines is bulking up its space-to-ground data network with the acquisition of United Kingdom-based Goonhilly Earth Station and its U.S. arm, COMSAT.

The $49.3 million cash-and-stock deal would add 44 antennas to Intuitive Machines’ network. The acquisition is expected to close in the third quarter.

Intuitive Machines, a space infrastructure and services company, designs, builds, and operates spacecraft and data networks for lunar and deep-space missions. Goonhilly operates a satellite Earth station in Cornwall, England.

Intuitive Machines says Goonhilly’s and COMSAT’s civil, commercial, and government customers will complement its current customer base and broaden its reach into related sectors.

“Customers have been clear that they want a single, integrated, and resilient solution for their communications and [position, navigation, and timing] needs as they accelerate missions at an unprecedented pace,” Steve Altemus, co‑founder and CEO of Intuitive Machines, said in a news release.

Kenn Herskind, executive chairman of Goonhilly, says the acquisition “will allow us to scale that capability globally and directly support the next era of lunar exploration. Together, we will be creating a commercial lunar communications network that is interoperable, resilient, and ready to support Artemis and international missions.”

Modular nuclear reactor co. NuScale Power moves into Houston market

New to Hou

The nuclear energy renaissance continues in Texas with an announcement by NuScale Power. The Oregon-based provider of proprietary and innovative advanced small modular reactor (SMR) nuclear technology announced in April it would be opening office space in Houston’s CityCentre.

“Opening this space in Houston underscores our commitment to meeting rising energy demand with safe, scalable nuclear technology,” John Hopkins, NuScale president and CEO, said in a news release. “This move expands our presence in a key market for partners, prospective customers, and stakeholders in addition to positioning us for the future as we focus on the near-term deployment of our industry-leading technology. Texas is leading the way in embracing advanced nuclear for grid resilience and industrial decarbonization, and we’re proud to expand our footprint and capabilities in this important region.”

Interest in nuclear power has been growing in recent years thanks to tensions with oil-rich nations, concerns about man-made climate change from fossil fuels, and the rapidly increasing power needs of data centers. Both Dow and Texas A&M University have announced expanded nuclear power projects in the last year, with an eye of changing the face of Texas’s energy industry through smaller, safer fission reactors.

Enter NuScale, founded in 2007 from technology developed at the University of Oregon. Their modular SMR technology generates 77 megawatts and is one of the only small modular reactors (SMR) to receive design approval from the U.S. Nuclear Regulatory Commission (NRC). These advances have led to runaway success for NuScale, whose stock has risen by more than 1,670 percent since the start of 2024.

The new operations campus in CityCentre is expected to facilitate the movement, installation and coordination of NuScale technology into the various energy systems. Typically, SMRs are used for off-grid installations, desalination operations, mining facilities and similar areas that lack infrastructure. However, the modularity means that they can be easily deployed to a variety of areas.

It comes none too soon. ERCOT projects that Texas data centers alone will require 77,965 megawatts by 2030.

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This article first appeared on EnergyCapitalHTX.com.

Pharma giant considers Houston for $1 billion manufacturing campus

in the works

Another pharmaceutical giant is considering Houston’s Generation Park for a manufacturing hub.

According to a recent filing with the Texas Jobs, Energy, Technology and Innovation (JETI) program, Bristol Myers Squibb Co. is considering the northeast Houston management district for a new $1 billion multi-modal pharmaceutical manufacturing campus.

If approved, the campus, known as Project Argonaut, could create 489 jobs in Texas by 2031. Jobs would include operations technicians, engineering roles, administrative and management roles, production specialists, maintenance support, and quality control/assurance. The company predicts annual average wages for these positions to be around $96,000, according to the filing.

The project currently includes the 600,000-square-foot facility, but according to the filing, Bristol Myers Squibb “envisions this site growing in scale and capability well beyond its opening configuration."

The Texas JETI program offers companies temporary school property tax limitations in exchange for major capital investment and job creation. E.R. Squibb & Sons LLC applied for a 10-year tax abatement agreement in the Sheldon Independent School District.

The agreement promises a $ 1 billion investment. Construction would begin in 2027 and wrap in 2029.

“The proposed project reflects [Bristol Myers Squibb Co.’s] enduring commitment to bringing innovative medicines to patients and ensuring the long-term supply reliability they depend on,” the filing says. “The proposed project is purpose-built to support and manufacture medicines spanning multiple therapeutic areas and modalities, positioning the site as a long-term launch and commercial campus for decades to come. These medicines will provide therapies to the [Bristol Myers Squibb Co.’s] patients located in markets both nationally and internationally.”

The Fortune 100 company is considering 16 other cities for the new manufacturing facility in the Central and Eastern markets in the U.S. According to the Houston Chronicle, Bristol Myers Squibb Co is still in the “evaluation process” for its potential manufacturing site.

Last fall, Eli Lilly and Co. selected Generation Park for its $6.5 billion manufacturing plant. More than 300 locations in the U.S. competed for the factory. Read more here.

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