Xoogler.co Event with McKinsey: The implications of COVID-19 on the startup ecosystem

A team from McKinsey spoke with the Xoogler community about the effect of COVID-19 on various business sectors. The event was hosted by YouTube Xoogler Laura Lee and featured Mihir Mysore, Vishwa Chandra, Greg Gilbert, Dilip Bhattacharjee, Brendan Gaffey and Antoine Grant. Thank you to McKinsey for sharing insights on the future of business given the COVID-19 crisis and for giving viewers a look into Fuel, McKinsey’s practice for startups!

Wide lens view of COVID-19

The panel started the evening by framing COVID-19 as first and foremost a global humanitarian challenge. Thousands of health professionals are heroically battling the virus, putting their own lives at risk. Governments and industry are working together to understand the long-term effects of the pandemic. While the news surrounding the virus is constantly shifting, people are settling into a view where they understand that it is a 2–3 year problem instead of a few months.

The Next Normal

1. Distance is back. Billions of people are now living in countries where borders are closed.
2. Resilience and efficiency. Resilient companies drove 3x higher revenues and 9x higher profitability compared to others through the last downturn.
3. The rise of the contact-free economy. Digital interactions with B2B customers jumped 40% from before COVID-19, which demonstrates the massive opportunities presented in this sector.
4. More government intervention in the economy is starting to take place.
5. There is more scrutiny for business.
6. Industry structures, consumer behaviors, market positions, and sector attractiveness are changing.
7. There are silver linings. Many new opportunities are presenting themselves in this time of crisis as industry lines blur.

Implications for Travel and Hospitality

Travel will be back with subtle shifts. There is an acceleration of the pivot from buying “things” to buying experiences. In terms of business travel, some internal meetings may permanently shift to remote video conferences. Overall, it will take a long time for airlines to return to pre-COVID levels of business.

COVID-19 effect on logistics

Airports, urban transit, ocean cargo, and cargo rails have all seen considerable decreases in demand since the start of the pandemic. On the flipside, post/parcel, warehousing, and trucking have all seen increases in demand. Due to the virus, supply chains are becoming lighter, shorter, faster, and more complicated. Additionally, the return post COVID-19 will be uneven depending on a company’s agility.

COVID-19 effect on healthcare

There have been massive changes to the healthcare sector due to COVID-19. Nearly half of all physician’s visits were online in April, up from only 2% in January. Additionally, now more than ever people are viewing telemedicine as a viable option for now and the future. To put this into perspective, $250 billion, or 20% of outpatient and home health, could potentially be virtualized.

Fuel

At the conclusion of the McKinsey panel on COVID-19 and business, Brendan Gaffey and Antoine Grant spoke to Xooglers about Fuel, McKinsey’s startup practice. Fuel supports startups with global network opportunities and helps connect startups with large corporate innovators. Fuel partners with both early and later-stage startups with tailored solutions to build capabilities and accelerate growth.