Time to get started

October 19, 2008

In times of change, new opportunity is always created. Always.

Many have written on the opportunity created by this economic downturn. Here are some of the excerpts:

Mick from Pollenizer writes:

1. You don’t need a boom to grow.
2. Better access to great people.
3. A slump doesn’t stop spending, and it increases in some areas.
4. There is still money available if you look hard, and you deserve it.
5. The community is still here to support you.
6. The big guys cut back on R&D letting you do the innovating. 

Paul Graham writes:

The economic situation is apparently so grim that some experts fear we may be in for a stretch as bad as the mid seventies.

When Microsoft and Apple were founded.

If we’ve learned one thing from funding so many startups, it’s that they succeed or fail based on the qualities of the founders. The economy has some effect, certainly, but as a predictor of success it’s rounding error compared to the founders.

So maybe a recession is a good time to start a startup. It’s hard to say whether advantages like lack of competition outweigh disadvantages like reluctant investors. But it doesn’t matter much either way. It’s the people that matter. And for a given set of people working on a given technology, the time to act is always now.

And Rajesh Jain writes:

For entrepreneurs, they need to forget about the craziness around and just focus on the business and market. The stuff that’s happening has little or no impact on the business of most early stage companies — in most cases, their revenue base is too small to see any negative impact from “market conditions.” So, any sales person giving market slowdown as a reason for not meeting targets needs to be given a talking to!

I also think this is a great time to get alternative / disruptive ideas to consumers and businesses. Everyone is much more receptive to  discussions about solutions which provide better ROI. (And without a simpler, cheaper solution, entrepreneurs don’t really have much of a chance anyways.)

Getting started today with the right idea is indeed an attractive prospect. If, however, you are two years in to your company and looking for extra funding without real traction or poof points, times are going to get very tough.
 
For startups in this category, I would suggest taking a long hard look at the value you bring to the table, and finding a partner who can absorb and propel your assets through these tough times.
  
I was interviewed fo the NYT on Friday on this very subject. I suggested the same thing to the reporter.
 
More conversation over on Silicon Beach as well (I got many of my snippets from there).
 

One Response to “Time to get started”

  1. Chris Camp Says:

    Well… good stuff. As someone who believes that foundational level change is necessary and that the current situation presents an opportunity for deep change I entirely agree. Tim O’Reilly had a great piece on a similar subject – http://radar.oreilly.com/2008/10/thoughts-on-financial-crisis.html

    I do take issue with one line from above: Rajesh Jain’s take on sales “So, any sales person giving market slowdown as a reason for not meeting targets needs to be given a talking to!”

    “Any” is a bit strong.

    I’m married to a real-estate developer and the last three years (&3 weeks) have been proof that there are times where macro-level trends overwhelm the sales ability of any particular individual. Which is merely to say that sales goals must be reasonable – if they haven’t been adjusted for macro conditions (like qualified applicants not being able to get a home or auto loan bcs the World fears a complete melt down) the sale person shouldn’t be put in the guillotine…

    Other than that – I’m on board and ready for a new wave of innovation that reaches deep and remakes the fabric of our economy.

    Best,
    -cc


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