Are we on the verge of another crisis? Well, falling stocks, mass layoffs, panic, and company closures say that the IT industry is going through hard times. What does this mean for companies and startups in particular, and is there a way to survive the economic downturn without global losses?
The downturn in IT: everyone is preparing for the worst
Companies are preparing for the battlefield, cutting teams and salaries. Y Combinator, the largest startup accelerator, sent out a newsletter warning of a challenging future and openly said that everyone should prepare for the worst. In its letter to the founders, YC even included a list of recommendations on dealing with the crisis. At this point, the issue of hiring and unemployment became especially relevant. Many companies initiate massive layoffs. For example, Klarna Bank has announced that it will lay off 10% of its 7,000 employees. It is a significant loss for the team. Uber Technologies and Lyft have announced that they are slowing down the hiring process; Meta said it is freezing recruitment in some departments. And the list of companies is growing.
The storm is impending, and top specialists are looking for protection and turn to the global giants such as Amazon and Microsoft. In mid-May 2022, developer job openings on Indeed increased by 125% compared to February 2020, the pandemic's start. In his article "The Tech Crash Could Be a Talent Bonanza for Big Tech," Christopher Mims talks about changing the competition for top talent, prioritizing "big tech." The big tech has a great chance to get IT talents who are now actively searching for stability.
Giant companies have many advantages. First, they have capital, which alleviates the economic crisis and creates completely different conditions for existence. They use these funds to attract IT talents. For example, Apple raises salaries and increases bonuses for its employees. At this time, startups are deprived of the primary resource for existence — investments. This makes it impossible for founders to finance their projects and hire professionals. And it's becoming pointless to compete with the tech giants.
But why are employment issues and the fighting for good specialists so aggravated? Human capital is the most valuable resource in technology, perhaps even more than in other industries. And when you have the strongest and most talented specialists by your side, it is easier for you to stand on your feet during the battle. This is the tactic used by large enterprises. But as long as they use their advantages and snatch out professionals, promising them bonuses and high salaries, startups have to survive with what is left.
Why do startups die?
Startup founders often mistakenly assume that they need more employees to grow. Why is this? It is based on the amount of work you just don't have the resources to finish. It seems that more people will help reduce the number of tasks per employee. But the team's growth is a consequence of the project development, and not vice versa. The fail chain is as follows. There is a decent product that is gaining momentum quite successfully at first. The creators easily take the first round of investments and profits. But since the product doesn't have a "wow" effect, growth is happening, but not at the expected pace. Then the founders convince themselves that hiring more people will help accelerate the project's evolution, completely ignoring the fact that the product itself is underdeveloped.
So startups are spending more than they make while still relying on investors. But due to the slow growth and lack of profits, investors also lose interest, which quickly leads to the company's death. To avoid such a mistake and predict the company's future, you can try an exciting tool — a calculator created by Trevor Blackwell. At this stage, the project must be improved and evolved, not expanded, and this is possible with fewer people. Even after receiving money from YC, Airbnb hired its first employee-only four months later. All this time, the original team worked hard, putting all their efforts into improving the product, and only then realized their readiness to expand the team.
How can no-code help startups survive?
So startups don't have to hire big teams, and they don't have to fight this battle for tech talent. Moreover, during the economic downturn, newcomers to the market have their loophole - no-code technology. In the present situation, no-code has the opportunity to express its potential and prove its effectiveness. No-code tools bridge the gap between tech and business users and open up more options for the latter. With the advent of such platforms that can code excellent solutions without the help of a developer, the cost of the existence of young companies is reduced, which helps them survive in a crisis.
AppMaster.io: a find for startups
AppMaster.io proves with its example that startups actively use no-code platforms. What problems do new companies usually face? Probably lack funds for development, a small team, and the need to work 20 hours a day, most of which is spent on finding investors and not polishing the product. No-code is often underestimated. Using AppMaster.io as an example, we want to prove that modern technologies can take on most of your responsibilities. More importantly, you won't have to overpay for it, and the result will be no less high quality.
The budget issue concerns startups most of all, especially during a crisis. A subscription to the platform will cost an average of $150-300. This is less than the salary of one developer. Moreover, with AppMaster.io, you can create an individual plan for a different cost. Therefore, the price will be directly proportional to the purchased functionality.
- Manufacturability and power
The concept of no-code is shrouded in stereotypes. Users' first associations are programs for quickly creating a site like Tilda. AppMaster.io has gone a long way in providing users with a complete platform for building apps without writing code. The code is generated by artificial intelligence at 22,000 lines per second in the Go language. You tell the platform exactly what you need to create, using visual editors to create business logic and application database. With AppMaster.io, you can build native mobile apps, web apps, and server apps. You can create custom projects of any complexity, focusing on your requests and needs.
Often the reason for not getting involved with no-code tools is the inability to detach from such a platform and continue developing the project on your own. It is not the case with AppMaster.io. Firstly, the platform's functionality is so extensive that you can create any ideas even within the tool. Secondly, if necessary, the code is exported for further work. At any time you need, you can disconnect from the platform and continue the development of the project independently.
AppMaster.io is a code generation tool that will help even a small staff of employees to cope with tasks faster and more efficiently. The platform protects you from accumulating technical debt, automates and optimizes many processes, and reduces development time by eliminating the need to write hundreds of lines of code. As a result, existing developers get more time to perform more critical tasks, the product continues to improve, and costs are significantly reduced. This approach will be optimal during an economic downturn in the IT industry, although startups can safely use no-code regardless of the environment.