What would life be without risk?

Risk. Four letters that make you wobble. Four letters that can determine your future. Four letters that are accompanied by chaos and decisions. Four letters that we all tend to avoid. However, they are four letters that make us learn, so what would life be without risk, right?

Throughout our lives we face different challenges in different aspects: problems with our loved ones, economic situations that are not ideal, complications at work... In the field of business, and specifically in technology companies, the same thing happens; risk puts us in front of situations of uncertainty in which we have to seek solutions and alternatives that help the business to continue to grow and be sustainable over time, and all this while generating the least possible negative impact, in other words, transforming the risk into opportunities for the business.

Technological advances are making companies in this sector grow very fast. However, this does not mean that they are risk-free. Even business giants can face situations that put the company at risk, so you have to be very prepared for what may come.

Having a good background and managing information and data

Running a business is not easy, let alone facing a risky situation. When setting up a technology company, it is necessary to carry out solid market research, understand how it works, who the competitors are and what they are doing, etc. This research is essential to understand the movements of the sector in which the company is located, because, having this information, dealing with the risks that can be found in the business will be much easier.

When the COVID-19 pandemic exploded, all companies found themselves in situations of risk and uncertainty.  It is true that many technology companies had a bit of an advantage. In the case of my company, Tiko, we managed to double our turnover. But not everyone was so lucky. In Spain, where Tiko operates, more than 300,000 companies closed because of the health crisis. However, we all had to react quickly and adapt to the new reality. This crisis, like many others, has made us learn, improve and be prepared for the challenges that may arise in the future.

Another imperative for an entrepreneur is to understand the company's balance sheet and use data to make decisions in crisis situations. The long-term survival of the company depends on it. For example, if the cash flow is known, the entrepreneur will be able to make contingency plans and allocate capital to areas where it is needed.

Having the right people by your side

According to a study by the consultancy PwC, 62% of companies worldwide reacted to the pandemic with a crisis plan. Even if an entrepreneur is the leader of the company, a risk situation cannot be handled by one person alone. Therefore, it is necessary to have a team of professionals to manage this type of situation. However, on other occasions, if we take all the above points into account, we can be prepared, react quickly to a crisis situation and minimise the damage to the company.

In short, risk is a very important element in a business situation, it is something that makes us learn, adapt and become better. As entrepreneurs we need to be able to transform risk into opportunities.