GUEST ARTICLE: Almost 18 months ago, during the Global Financial Crisis, I wanted to share a bit of optimism so I wrote this post about it being the best time to start a new business and I believe I was right.
- It Takes Time – to start something from scratch, build it up and make serious profits/sell it
- You Don’t Need A Boom To Start – It may be true that it’s easier to start in a boom, but it’s not required
- Great People For Hire – I’m not trying to treat people as a commodity here, it’s just the facts that supply will outstrip demand for a while and that’s a good thing for founders.
- Slump In What? – “You can still sell stuff”
- There Is Money – Yes, there’s less silly money, less private equity, less from family, friends and fools, but it’s there.
- We’re All Still Here – No start-up is an island. It is born, nurtured, matured and blossomed in a community and network that is a key part of the success
- Less Competition In Innovation – When the economy flies to safety, one of the first budgets of the big boys that get cut is the R&D budget. Why is this good? It means that they are leaving much of the new opportunities to you and your shiny new startup.
- So Get Started – if you’ve got an idea that’s been in your head and you’re thinking “Woah, have to put that on hold for now.” then pick it back up again
A bunch of companies started during the GFC are on a great path right now. “So what about now?”
Well, it’s a great time to grow a business. Much of the business and consumer world are confident and optimistic (except Greece maybe). The first of the growth results are trickling in, so this should continue. It’s not hot right now, but you don’t want it hot, you just want it supportive of growth and expansion. You want sales.
All this points to more money available for investment. I don’t think there is going to be a better time than between now (June, 2010) and the end of 2011 to raise capital for small, private, startup businesses. They won’t invest in ideas or crazy dreams and you won’t get $1m for 1%, but you will get smart people investing smart money in smart teams.
More importantly, it’s the right time to accelerate your business. This is specifically more important for startups. The reason is, if you want to grow, exit and finish your earn out, then you want to do that before the next decline. If we’re ramping up now, then we might be hitting the peak in 4-5 years. If it takes you a year or two to grow, a year or two to sell and a year or two to exit, then you better get moving now.
“But what if didn’t start 18 months ago?”
Well, then things are going to be slightly harder. But that is an awful excuse. To paraphrase Mrs Landingham from West Wing, “If you don’t have any ideas and you don’t have the desire to commit to them and make it happen, then I understand. But if you do have ideas and passion, but just think it’s too hard, then gee, I don’t even want to know you.”
This guest article has been written by Mick Liubinskas. Mick is a partner at Pollenizer, which helps web businesses grow and become successful.
If you’re a blogger or an expert about a topic I cover on this blog I encourage you to contact me and I’ll consider publishing your guest article here including generous attribution and back links back to your website as thanks for your contribution
4 thoughts on “Global Financial Crisis: Great Time to Grow a New Business”
I starting a business 18 months ago and it was a great decision. we are growing much more than we ever anticipated.
i agree that a financial crisis is a great time to grow a business, providing you are not overstretched financially (like many others).
Competition is better for niches that would otherwise have been inexploitable as larger more overstretched companies struggle to prosper now. Slow organic growth prog will prosper as the economy grows as youre flowing with the economic tide rather than fighting against it trying to recoup losses from a downturn.
I am personally optimistic about the coming years.
being overstretched financially is precisely why it is the best time to grow a business, not why one should not consider or launch into new things.
Hungry lions hunt the best. Over half of the Fortune 500 companies were started during lowest of economic times, many who stretched everything in their lives.
Needs are the mother of invention, not money. No one gets anywhere (i.e. no one who does not have a silver spoon) unless they stretch and unless they risk and also at times wreck.
People who don’t have money need to stretch because those that do have money, often don’t need to stretch. Find a need and meet it. There is no substitute for determination. Strecth first, relax later.
I think the “recession” was engineered my self but I agree with you 100% if a business can start up and make profit during downtime in the economy then they will be a superstar when it improves