This editorial appeared in the April 11th, 2025, issue of the Topline newsletter.
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From bloodbath to bonanza in seven days flat. Markets hemorrhaged $6T over two days after April 3rd's tariff bombshell - an unprecedented collapse. Yesterday, they reclaimed $5T+ in hours as those policies were abruptly shelved - the largest single-day gain ever. When future traders need to explain volatility, they won't need charts or formulas - just the story of this week.
But the story of this week might be more than that. Volatility - rapid, unpredictable market swings - has become our new normal. The post-2008 stability we once knew vanished when a microscopic virus shut down the global economy in 2020. What followed was a manic sequence: markets ripping through late 2020-2021, inflation surging, interest rates climbing, and markets retreating through 2022-2023. We barely caught our breath in 2024 before being thrown back into the storm in 2025.
These violent swings don't materialize from thin air. They're triggered by macro economic changes, geopolitical power struggles, and technological disruptions that reshape entire industries overnight. When these forces collide with sufficient magnitude, volatility erupts.
This leads us to the most important question of the moment: do we see such changes increasing or decreasing in the coming years?
I'm firmly in the "buckle up, it gets crazier from here" camp. So, if volatility is our new reality, then we need a playbook not just for weathering these storms, but for capitalizing on them.
Fortify Before You Fight
To capitalize on market volatility, defense comes first. The playbook begins not with opportunistic moves, but with fortifying your foundation.
While complex hedging strategies exist, three fundamentals demand mastery:
- Cash: When a business runs out of cash, it flatlines — just like humans without oxygen. The danger lurks in decisions made during stable times — aggressive expansion plans, long-term contracts, and capital-intensive bets that suddenly look reckless when markets convulse. This is why scenario planning must become a reflex for executive teams. When the improbable becomes inevitable, only disciplined capital allocation keeps you breathing.
- Customers: Customers seek dependable partners in all market conditions. This dependability isn't one-dimensional — it comes from being stable, supportive, and innovative. That's the trifecta you must project to build a business that can ride any wave. Beyond this, continuously stress-test your value proposition: If the cost of capital increased, would customers still see you as essential? This kind of clear-eyed assessment prevents you from joining those ZIRP-era darlings now struggling to justify their existence as market conditions have shifted.
- People: Beyond avoiding bloat, you need a core team built for turbulence — people who see obstacles as puzzles rather than barriers. When markets convulse, these veterans with battle-tested judgment become your most valuable asset. Their institutional knowledge can't be replicated in a crisis. In an ecosystem where two-year tenures are standard, cultivating loyalty requires intention, not hope.
With your defenses fortified, you've earned the right to attack. And attack you must — because constant volatility won’t reward those who hunker down and wait for calm waters.
Your offensive strategy will be uniquely yours. Some will execute bold M&A plays that reshape their category. Others will attract once unattainable talent suddenly available and looking for stability. Some will deploy pricing strategies that leave competitors gasping. Others will double down on innovation and brand building precisely when rivals retreat.
The specific move matters less than the method. In volatile markets, disciplined selection, relentless measurement, and precise timing separate winners from losers. We must develop muscles for rapid iteration that atrophied during the long bull market — capabilities that weren't prerequisites for success in the past decade but now determine who survives to see the next one.
Our cognitive bank account shows record deposits alongside alarming withdrawals.
From Storm Shelter to Category Killer
Salesforce's journey during the 2000-2002 recession offers a masterclass in both defense and offense during extreme volatility. When the dot-com bubble burst, the fledgling company faced evaporating funding, disappearing customers, and Siebel's market dominance. Their response perfectly illustrates our playbook.
On defense, cash discipline was their oxygen mask. They cut 20% of staff early, shifted to annual upfront payments, and maintained a lean "no fluff" culture. Their customer strategy centered on dependability through stability, support, and innovation. For talent, they selectively pruned while keeping their battle-tested core intact — and opportunistically hired when competitors faltered.
While Siebel retreated defensively, Salesforce launched their calculated offensive. Their pricing strategy became a devastating weapon — offering subscriptions at roughly 25% of Siebel's cost with none of the implementation headaches. This wasn't just cheaper — it fundamentally changed buying criteria during uncertain times. They amplified this advantage through provocative "No Software!" marketing campaigns that directly targeted Siebel's frustrated customers.
Salesforce continued their attack by investing in R&D when others cut back. They rapidly improved their product, launching their application platform in 2003 and laying groundwork for the AppExchange ecosystem. They recognized that a crisis wasn't just a threat but a once-in-a-decade opportunity to reinvent an industry.
The result was that by 2004, Salesforce had grown from $5.4 million to nearly $100 million in revenue and was ready for its IPO. Siebel — once valued at $40 billion — saw its market position erode until Oracle acquired it for a fraction of its former worth. This wasn't luck. It was the calculated execution of both defense and offense during market chaos. Salesforce didn't just survive the storm — they used it to fundamentally reshape their industry.
So, if you're with me in the "buckle up, it gets crazier from here" camp - which seems inevitable in this AI-accelerated era - then you must ready yourself for a prolonged period of volatility. By being prepared for it, we transform market chaos into strategic opportunity, perhaps even finding exhilaration where others see only danger. The alternative is a constant state of anxiety and exhaustion that drains resources and blinds us to possibilities - a horrible state that should be avoided at all costs.
