December 5, 2008
by Alastair Halliday
We have seen a significant amount of fresh business from startups and new businesses over the last few months, with this past month being the most dramatic. Mark has already written briefly about Your marketing budget and a slow economy, which talks about maximizing your return on investment, and I want to reflect a bit on the entrepreneurial spirit. I see two major factors contributing to our spike in business from this group.
Innovation is Recession Resistant
At a public bi-weekly coffee get-together of smallish business owners and entrepreneurs here in Providence, a grad student asked if any of us had seen a significant hit in our businesses during the downed economy. One business owner turned to him and said that good ideas and innovation will always succeed. He was right on. As we see large sections of our economy crumbling, the pieces that are in high demand are good ideas, refreshing new products and tools that increase efficiencies and add value. History concurs. Wired.com’s Daniel Roth writes that out of the turmoil of the Great Depression rose numerous inventions, including the now ubiquitous nylon and television. The 1969-70 and 2001 recessions saw the advent of the pocket calculator and the ipod, respectively. Innovation never sleeps.
Layoffs and Dead-End Jobs are Breeding Grounds for Entrepreneurship
Sometimes it takes a little shove from the nest for some entrepreneurs to focus back on the things that they were once passionate about, or to implement an idea that has been percolating for some time. There’s also nothing like layoffs of your colleagues and friends in your company to knock creativity and optimism out of you. I went through this with the first .com bubble back in 2001. Try motivating a creative team when they come to work every day packed to be fired and thinking every conversation with your boss is going to end with a pink slip. It just doesn’t inspire confidence. Recessions and layoffs release many undervalued employees to do what they have always wanted to do. They go back to their basement or garage and think up the next best thing.
Slim Kiwi is not in the mortgage business or in investments, and we’re not unionized American car makers. We partner with our clients to bring their idea, their product and their small business to market. From what we have seen, it seems that now is a great time for small businesses to get ahead of their competition. If you know us, you know that we just love working with people starting up businesses. We love their enthusiasm, their pragmatism, their creative thinking, the speed at which they move, and their collaborative spirit. These are the tools for success in a challenging economy.