How European startups can weather the storm with eight affordable technologies

Mindaugas Mikalajūnas, CEO of SME Finance, explores eight affordable technologies that can provide practical solutions for European startups seeking to strengthen operations, reach more customers, and ultimately survive and grow.
How European startups can weather the storm with eight affordable technologies

There is a whole warehouse of obstacles facing European startups and smaller companies right now that can feel overwhelming. Economic instability, talent scarcity, digital disruption - how can startups possibly keep up? 

With nearly €1.5 billion already committed to help the sector grow, we know well that running a scaling business is not easy. In particular, cost control is the name of the game right now. 

The good news is that technology provides practical, affordable solutions for startups seeking to strengthen operations, reach more customers, and ultimately survive and grow. With so many digital tools now within reach, small teams can work smarter, move faster, and gain an edge once reserved only for larger competitors. 

Operating costs - Cloud-based solutions, remote work technologies, and automation tools can significantly reduce overheads like office space, equipment, and manual processes. Cloud computing provides affordable, scalable access to advanced IT resources without major infrastructure investments. Remote collaboration platforms enable distributed teams and virtual workspaces, reducing the need for physical offices. And intelligent automation can handle repetitive back-office tasks, freeing up staff time and lowering labour costs. Together, these technologies free up resources for other parts of the business and allow startups to become more agile and streamline operations.  

Financial Control - Keeping a tight rein on operating costs also involves excellent real-time visibility over the financial numbers. “Follow the budget” is one of the best pieces of advice for startups and cash flow management is how you do it. Digital accounting automation provides up-to-date tracking of income, outgoings, invoices, taxes and more. Machine learning streamlines expense reporting and cloud-based finance systems enable remote, multi-user access. Payment processing is expedited through digital channels. With these tools, startups can better manage cash flow, identify waste, and make data-driven decisions

Finding customers - Startups often lack expansive marketing budgets and strong brand awareness compared to longer-established enterprises. By harnessing social media, digital marketing software, and e-commerce platforms, they can tap into new ways to reach potential customers online in a targeted, cost-effective manner. 

Most founders will be familiar with social media, which allows personalised engagement and community building. Email marketing software might be less familiar. It provides data-driven tools for targeted promotional campaigns, allowing startups to segment contacts, create customised content, automate workflows, and analyse performance. Features like A/B testing and analytics help optimise email reach and engagement. 

Search engine marketing is vital too. It encompasses paid search advertising and search engine optimisation (SEO) to improve organic search visibility through keyword optimization, site speed, mobile-friendliness and building high-quality backlinks.

Together, optimised email and a targeted search presence offer affordable ways to drive traffic, generate leads, and increase conversions for startups. Advanced platforms make these powerful tactics accessible without large marketing departments.

Data & cybersecurity - Due to limited resources and expertise, new companies can be vulnerable to cyberattacks and data breaches. Security solutions for safeguarding intellectual property, customer data, and reputation are essential, however many tools tailored for large enterprises are complex and might represent costly overkill. Fortunately, purpose-built security software for growth companies offers budget-friendly protection - from endpoint security to firewalls tailored for small business networks. If the worst does happen, DR (disaster recovery) can be put in place via scalable cloud backup to provide affordable protection against ransomware, disasters and downtime. With the right solutions, smaller businesses can implement enterprise-grade security practices.

Skills gaps - Small teams with cross-functional responsibilities can lack skills in key areas as they juggle diverse roles. Online training platforms now provide on-demand access to upskill staff in areas like digital marketing, data analysis, project management, communications and more. Freelancers and contractors can also fill short-term gaps, lending specialised expertise without the need for full-time hiring. For tech roles, code bootcamps and certification courses enable rapid reskilling. With modular learning and talent options, it's much easier today for startups to develop in-demand skills rapidly.

Finding new employees - Smaller startups often cannot compete with large companies when it comes to recruitment budgets and employer branding. However, digital tools can help level the playing field. Leveraging these platforms allows SMEs to secure talent for specific projects or tasks without the long-term commitment and overheads of traditional hiring.

In addition, job boards and social media aid targeted outreach to candidates. Applicant tracking systems streamline sorting and communication. Screening tools like skills assessments and video interviewing identify best-fits faster. Onboarding software smoothes transitions for new hires. With talent acquisition technology, startups can attract, evaluate and onboard suitable candidates efficiently despite limited HR resources.

Access to capital - This is my specialist subject, of course. After the funding glut of 2021/22, many startups are increasingly struggling to secure loans and investment, limiting their growth. Financial technology now provides alternate options beyond traditional financing routes. Crowdfunding can raise smaller amounts from multiple backers. Peer-to-peer lending connects lenders to business borrowers directly. Invoice financing unlocks cash tied up in unpaid invoices. Simplified digital applications also ease access to government funding programs. With more ways to cover costs, investment and growth are no longer out of reach.

Regulatory compliance - Keeping up with complex regulations like taxes, data protection, and industry-specific requirements is challenging, especially for smaller teams. Legal and regulatory tech provides user-friendly tools to navigate compliance duties. 

  • Solutions include digital tax filing solutions like Xero that automate processes such as VAT calculations, returns, and payments to tax authorities. This saves time and reduces compliance errors. 
  • Data governance tools such as data mapping and data discovery software get visibility into what personal data companies hold to comply with GDPR requirements. 
  • Licence and permit tracking platforms provide dashboards to monitor renewal dates, manage documentation, and get alerted about upcoming deadlines for certifications and more. 
  • Legal guidance apps let startups get on-demand answers to common legal questions and customise documents like contracts, NDAs and policies specific to their business needs. 
  • HR software assists with employment law compliance by digitising processes like background checks, leave management and workplace policy distribution/tracking.

By streamlining tedious compliance processes, these kinds of regulatory tech tools reduce administrative burden so founders can focus on core business goals. 

No substitute for enterprise

Of course, tech alone won't guarantee success - ingenuity and determination still drive entrepreneurs at their core. But embracing innovation, even incrementally, can empower smaller players to think big, punch above their weight, and craft their own underdog success stories.

Lead image: Photo by Maximalfocus

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