The entrepreneur bug bites in a recession.
From the SBA’s letter to the President 2009:
Small businesses have struggled mightily over the past year. Recession has forced many of them to scale back their businesses, to “sit on the sidelines” and wait for the economy to improve, or unfortunately for some of them, to close their doors. For many individuals, though, an economic downturn represents an opportunity to start their own business, to move in a new direction, to jump into markets their larger counterparts might have exited, or by creating an innovative response to an unmet need, even to start entire new markets. Entrepreneurship will be a crucial means of moving out of the current recession.
Schramm and Litan (2009) observed: Time and again, entrepreneurs have led the way out of past economic downturns. Current business legends like Microsoft, Federal Express, Intel, Charles Schwab, and Southwest Airlines started in recessions or down markets. Indeed, 18 of the 30 companies that make up the Dow Jones Industrial Average were launched in recessions or in bear stock markets. As Vivek Wadhwa of Duke University and Harvard Law School has pointed out, the pioneers who launched these firms (and others) during the darkest of times realized the following advantages of starting a business in a recession: less competition, lower costs, ease of recruiting employees, and less pressure to expand. (article by Vivec Wadhua, 2008)
Such a message is inspiring in that it provides hope to Americans who have become accustomed to bad economic news on an almost daily basis.
“Small businesses have struggled mightily over the past year…” (Ya think?) The intrepid entrepreneur presses on, though. She could be someone laid off from a large corporation or (still employed) starting something on the side to make ends meet. But like Jay Golz wrote today about starting a business in this economy, it’s something that’s in the blood. Sometimes it’s adversity that gets the juices flowing and adversity that creates the most rewarding conditions for success.
Markets are weird that way; good thing.
« Plan for a backup, in case things happen | Home | Um, ground zero still looks like ground zero (or is it just me?) »
Leave a Comment