Momentum Scaling When The World Is In Crisis
What current geopolitical events reveal about the real advantages of customer-funded growth
The morning of February 28, 2026, changed the calculus for every founder I know.
When the United States and Israel struck Iran and the Strait of Hormuz effectively closed to commercial shipping, oil prices surged past $90 a barrel within days. A fifth of the world’s oil supply was suddenly at risk. Within a week, shipping companies were rerouting around the southern tip of Africa, insurance premiums were skyrocketing, and analysts were warning of knock-on effects in sectors nobody expected, from synthetic fabrics to fertilizer to aluminum.
This wasn’t a hypothetical scenario in a business school case study. This was Tuesday.
And it landed on top of everything else. U.S. tariffs are causing Canadian businesses to postpone expansion plans. A CUSMA (USMCA) renegotiation scheduled for this summer could reshape cross-border trade for a generation. A weak Canadian dollar squeezes anyone who imports in U.S. currency. Electricity prices, driven by insatiable demand from data centres, are climbing. The Bank of Canada projects GDP growth of barely 1% for the year.
If you’re a self-funded or customer-funded tech founder reading this, you’re probably feeling the compound weight of all of it. You’re not imagining things. The ground really is shifting under your feet, in multiple directions at once.
I know this feeling. I’ve spent 25 years coaching Canadian technology entrepreneurs through exactly these kinds of moments, the ones where the rules change while you’re still learning them.
Stress-Testing the Framework
I’m writing a book called Momentum Scaling that presents an alternative to the venture capital playbook for growing technology ventures. The book is built around three strategic principles: managing uncertainty, leveraging constraints, and maximizing execution. Together, they describe how resource-constrained founders can build profitable, resilient companies without surrendering equity or control.
When the Hormuz crisis hit, I wanted to know whether the framework I’ve been developing actually holds up under the kind of pressure we’re experiencing right now. Not in theory. In practice, against real economic data.
So I did something I do regularly as part of my writing process. I asked my AI developmental editor to pressure-test the manuscript against current conditions. I fed it the full alpha manuscript alongside the question: how do the three principles of Momentum Scaling hold up in a world of high energy prices, trade uncertainty, and compounding disruption?
What came back confirmed something I’d suspected but hadn’t fully articulated. The current environment doesn’t challenge the Momentum Scaling framework. It supercharges it.
Here’s why.
The World the Book Describes Is the World You’re Living In
In the opening chapters of Momentum Scaling, I introduce a concept that futurist Jamais Cascio calls BANI: Brittle, Anxious, Nonlinear, and Incomprehensible. It describes a world where systems that appear strong can collapse without warning, where founders can’t plan with confidence, where small causes produce massive and unpredictable effects, and where the sheer complexity of interconnected global systems exceeds our ability to understand them.
March 2026 is BANI made flesh.
The Strait of Hormuz closure is brittleness in action. Global shipping routes that everyone assumed would remain open have effectively shut down. Insurance markets, not military force, did most of the work. The system looked robust right up until the moment it wasn’t.
Anxiety is everywhere. The Bank of Canada, TD Economics, BMO, and RBC all describe the same picture: businesses are postponing investments because they cannot predict what costs will look like in six months. TD Economics put it memorably, describing Canada’s outlook as having a “Charlie Brown cloud” hanging over it. Founders I work with echo the sentiment. They’re not panicking (yet). However, they’re stuck, unsure which decision to make when every input variable is in motion.
The nonlinearity is staggering. A military conflict between the U.S., Israel, and Iran, thousands of kilometres from Canada, is about to show up in your cloud computing bill. Rising oil prices feed into electricity costs, which feed into data centre operating expenses, which feed into the price your SaaS company pays for infrastructure. Meanwhile, rerouted shipping containers will arrive at North American ports in clusters over the next few weeks, creating congestion that ripples into delivery timelines for physical goods. Small causes. Massive, unpredictable consequences.
And the incomprehensibility? Try holding all of this in your head at once: tariff policy, CUSMA renegotiation, a Middle East war, AI-driven demand for electricity, a weak dollar, rising wages from labour shortages, and slowing population growth. No spreadsheet captures all these interactions. No scenario plan accounts for their compound effects. This isn’t a knowledge gap you can close with better analysis. It’s a permanent condition.
The book I’ve been writing describes exactly this world. The question is whether the principles I propose help you navigate it.
Principle One: Manage Uncertainty
The foundational discipline of Momentum Scaling begins with a simple fact: things will go wrong. The question isn’t whether you predicted the specific thing that went wrong. It’s whether you can see your vulnerabilities clearly once they’re exposed.
Let’s be honest. If you’re running an early-stage tech startup, you almost certainly didn’t map your energy dependencies six months ago. You didn’t model what a Middle East war would do to your cloud hosting costs. You weren’t tracking the Strait of Hormuz as a variable in your unit economics. Why would you? You were heads-down building product, closing customers, and trying to make payroll.
That’s not a failure of planning. That’s the reality of being a founder with limited time, limited resources, and a hundred priorities competing for attention.
But here’s what just changed. Dependencies that were invisible two weeks ago are now staring you in the face. Your cloud bill didn’t used to feel like an energy dependency. Now, with electricity prices climbing and data centre costs under pressure, it is one. Your U.S. customer revenue didn’t feel like a trade policy risk. Now, with CUSMA under renegotiation and tariffs already causing American buyers to delay orders, it is one. Your component costs didn’t feel connected to a shipping lane in the Persian Gulf. Now, with container ships rerouting around Africa and port congestion building, they are.
This is uncomfortable, but it’s also valuable. You can now see something you couldn’t see before.
In the book, I introduce a framework for systematically mapping your Hypotheses, Assumptions, Risks, and Dependencies. The purpose isn’t to predict the future, but rather to take the vulnerabilities that just revealed themselves and manage them deliberately, before the next shock compounds this one.
One of the case studies in the manuscript tells the story of a 130-year-old Canadian manufacturer who invested millions in modernizing its production line, only to have U.S. tariffs arrive without warning, blowing a hole in its cash flow projections. Their strategy was perfectly calibrated for a world without tariff disruptions. That optimization became their weakness. When I wrote that story, tariff disruption felt like a significant but bounded risk. Today, with the effective tariff rate on Canadian goods sitting between 6% and 8% and the CUSMA renegotiation looming this summer, that story reads like a warning written in real time.
Forget whether you should have seen this coming. What matters is that right now, today, you can see dependencies that were hidden last month. Your cost structure has assumptions baked into it that you never consciously chose. Your revenue projections rest on trade relationships that you assumed were stable. Your infrastructure spending scales with variables that are suddenly in flux.
Managing uncertainty starts with making those invisible bets visible. Not retroactively, not as a scolding exercise, but as an honest inventory of where you stand right now. What do your economics look like if energy costs stay elevated for six months? What happens to your margins if the Canadian dollar weakens further? Which of your customers are themselves exposed to tariff pressures that might cause them to delay purchases or renegotiate contracts?
You don’t need perfect answers. You need the questions on the table.
Build this into your rhythm. Set aside time every month to document and review your Hypotheses, Assumptions, Risks, and Dependencies. Founders who do this consistently see the cracks earlier and recover faster because they already know where to look.
Principle Two: Leverage Constraints
Here is where the current environment reveals something counterintuitive, and I want to be careful about how I say it, because I know it doesn’t feel this way when you’re watching your costs climb.
If you’ve been building under financial constraints, you’re better prepared for this moment than you probably realize.
I don’t mean that bootstrapping has made everything easy. I know it hasn’t. What I mean is that the habits your constraints forced on you are exactly the ones that matter most when conditions deteriorate for everyone.
The venture capital playbook optimizes for growth velocity under stable conditions. It assumes that capital can always be raised, that markets will continue expanding, and that speed matters more than efficiency. When input costs spike, markets soften, and investor confidence wavers, that playbook breaks down fast.
We saw this in 2008 when funded startups collapsed while bootstrapped companies quietly survived. We saw it again in 2020 when the pandemic exposed how many venture-backed growth strategies depended on conditions that could vanish overnight.
Now it’s tariffs, an energy crisis, and trade uncertainty arriving simultaneously, and the company that raised $20 million and built a team of 60 before validating delivery capability is exposed in ways that weren’t obvious a month ago. Their burn rate, which seemed manageable when the next round felt certain, suddenly looks precarious.
You’ve never had that luxury. And right now, that’s the point.
Think about what operating under constraints has taught you. You probably know your unit economics better than most funded competitors know theirs, because you had to. You’ve been measuring the return on every significant expenditure, not because you read it in a business book, but because your cash flow demanded it. You’ve been building efficient growth rather than fast growth, because burning money was never an option.
You may not have articulated it this way, but you’ve been stress-testing your business model continuously, every month, every quarter, by the simple act of surviving on real revenue.
That doesn’t mean you’re immune to what’s happening. Rising costs are rising costs, and a 1% growth economy is harder for everyone. But there’s an enormous difference between a company that needs to learn financial discipline in the middle of a crisis and one that’s been practising it for years. You’re the second one. The constraint that felt like a disadvantage has been building muscle you didn’t know you’d need this badly.
In the book, I describe ten disciplines that emerge from operating under constraints. Constraints require you to stop hedging. They teach you to find efficiency rather than scale. They drive you to prove your economics before you expand. They compel you to measure the return on every investment.
These aren’t theoretical virtues. In this economy, they are the difference between having options and having none.
Principle Three: Maximize Execution
The third principle draws a distinction that I believe is the most important idea in the book: the difference between traction and momentum.
Traction is quantitative evidence of market demand. It goes up and down depending on conditions. It’s momentary, and because you have to continuously feed the machine that generates it, traction is not self-sustaining without the operational foundation to support it.
Momentum is your ability to execute: consistently creating, delivering, and capturing value as you grow. Momentum means your operational capabilities grow in lockstep with market validation.
Most founders I work with don’t think about this distinction explicitly. They’re focused on getting customers, shipping features, and growing revenue. That’s understandable. But the current environment is about to make the distinction unavoidable.
Here’s why. When energy prices spike and supply chains shift, demand doesn’t disappear overnight, but your ability to serve customers at the same quality and cost can erode faster than you expect. A SaaS company watches its margins thin as infrastructure costs climb. A company with a physical product sees shipping timelines stretch from two weeks to six. A service business starts losing key team members to larger companies willing to pay a premium in a tight labour market. Delivery cracks before demand does, and that’s where the damage starts.
If you’ve been investing in your operational capability, in systems, processes, and team development, those investments are about to pay off in ways that aren’t immediately obvious. You can absorb a cost increase because your delivery is efficient enough to maintain margins. You can retain customers because your service quality doesn’t degrade as conditions become more challenging. You can retain team members because you’ve built a workplace where people see a future, not just a paycheque.
If you haven’t been making those investments, this is the moment to start. Not all at once. Not everything. But the founder who spends the next quarter strengthening their delivery systems, even modestly, will be in a fundamentally different position than the one who spends the same quarter chasing new customer acquisition while their operations strain under the weight.
Bank of Canada Governor Tiff Macklem recently made a version of this point, noting that when the economic landscape changes, Canadian businesses need to adjust. We can be victims of disruption, he said, or we can lean into structural change. That’s the antifragility argument at the heart of Momentum Scaling, expressed in central bank language. But it’s also a practical invitation: the businesses that come through this period stronger are the ones that use it to build capability, not just survive.
What This Means for You
If you’re a self-funded or customer-funded tech founder in Canada right now, I want to be honest with you. I’m not going to tell you this is easy or that your constraints magically shield you from a global energy crisis and a deteriorating trade environment. They don’t.
What I will tell you is this: the path you’ve chosen is not a compromise. You have been building strengths that the current environment is about to reward.
You understand your economics because you had to. You operate with discipline because there was no alternative. You’ve built something that runs on real revenue, not on the promise of a future funding round that may never materialize.
Those aren’t consolation prizes. In March 2026, they are competitive advantages.
The world is not going to stabilize. The Hormuz crisis will eventually resolve, but something else will follow. Tariffs will shift. Supply chains will reconfigure. Energy costs will fluctuate. AI will reshape markets in ways we can’t yet comprehend. The question isn’t whether disruption will arrive. It’s whether you’ve built something that can adapt when it does.
Start with what just became visible. Map the dependencies you didn’t know you had. Stress-test your unit economics against the costs you’re facing right now. Look at your operations and ask honestly where the cracks would appear if conditions stay this way for six months.
You don’t have to do this perfectly. You just have to start.
You have more going for you than you think.
I’m completing a book called Momentum Scaling: How to Build a Successful Technology Venture in a World That Refuses to Hold Still, planned for release this summer. If the ideas in this piece resonate with your experience, I’d love to hear from you.
Full disclosure: I used Claude AI as a collaborative analytical partner for the economic analysis underlying this piece, consistent with the AI practices I describe in the book’s Author’s Notes.
Davender’s passion is to guide innovative entrepreneurs in developing the clarity, commitment, confidence and courage to enter, engage and lead their markets in a world that refuses to hold still, by thinking strategically and acting tactically.
Find out more at https://coachdavender.substack.com/about and https://linkedin.com/in/coachdavender