In a recent board meeting, a healthy discussion ensued around the trade-off between growth and prudence (e.g. spending reduction) in turbulent times. In the aviation world, it's known as decision speed, whereas an aircraft (plane or helicopter) needs to reach a certain velocity to get airborne. Moreover, for safety sake, critical abort alternatives present at various levels of velocity.
Unlike aviation, such decisions in Company building involve the construction of such a multivariate equation that decisions are not always clear and evident. In the software/internet spaces, we live in a fluid environment where the execution of strategic objectives is seldom a straight line and Decision Speed often feels like a way of life. For sure exacerbated by broad market conditions.
To provide a framework for thinking re-investment considerations, I look at the following guide (not covering all alternatives):
1. Company in a growing market, growing market share, and path to self-sustainability. Starting with an easy one; action.....continue to invest, and go for it.
2. Company in a static market, growing market share and path to self-sustainability; action... examine if ecosystem partners are interested in a combination. Market will probably shake out; action;...it's the time to be a lead player, or exit to one who will lead.
3. Company in a nascent market, unproven business and market share irrelevant; action; share the pain (mgm't and investors) if knowledge gained support initial investment hypothesis.
Our industry has fresh memories about dealing with such turbulence, as well as operating in high velocity environments.
Many other scenarios exist, only limited by your imagination. I have found that devising the best plan lays with a candid assessment of your position, then taking action. Sometimes this action is not governed by the academic perspectives of what is best for all stakeholders, but the unique situation individuals or organizations find themselves in.
I have heard it said that now may not be a time for heroes; but it's also not a time to defer pursuing a definitive course of action; based on the facts, not what's popular. This may indeed be heroic.