2020. It’s going to be a hard year for us to forget. Between COVID, the unsettled election, lack of stimulus, job losses… It’s hard to find good news anywhere, and it’s pretty scary to think about the future. As winter approaches and the potential of further shutdowns loom, many people are struggling to figure out what comes next.
The easy path is to lie in wait until things appear to improve. However, in my experience, now is the time to get to work on that business you’ve always wanted to launch. It may seem counterintuitive, but you can be sure that this is an extremely opportune moment for budding entrepreneurs. In fact, many of the businesses and brands you regularly interact with today were started during the 2008-2010 recession.
Take a look at this list:
While not nearly as successful as the above companies, I launched my first business in 2008. It was scary and the economic climate was pretty bleak. With some diligence and work, we were able to raise some funds and launch. Sure, there were a thousand hard things that stood in the way of our success, but we put our heads down and worked diligently. We grew our revenue slowly but surely and over time, as we learned what we were doing, were perfectly positioned to take advantage of the eventual economic uptick. We were then able to raise more money and quickly grew into a successful business.
Obviously 2008 didn’t have the pandemic, but there are clear similarities between the two economic climates. It’s difficult right now, but we know from experience that things do eventually get better. With that in mind, here are 7 reasons why right now is a great time to launch a business:
1. People want innovation
Recessions create problems. Consumers and businesses are looking for solutions, which creates opportunity. Take a look around and see if there are some problems in your business or personal life that could benefit from an innovative solution.
2. Your initial costs and overhead costs are low
Given the carnage out there in real estate and small businesses, your startup costs and overhead will likely come very cheaply right now. You can get your business up and running with a much smaller investment than in a hot economy.
3. Your potential customers are looking for ways to save money right now
Since your startup can be put together inexpensively, and it’s likely to have fewer expenses starting out, this should enable you to offer a product or service that undercuts your competition’s pricing while still making a profit. Do a great job and you’ll keep these customers as the economy recovers.
4. You have less competition
In a heated economy, everyone wants to start a business. During a slowdown, folks think they should wait until things heat up. But they’re wrong. Starting your business when costs and competition are low is a recipe for eventual success. Just like I did, you can work methodically and be poised for growth when the economic climate improves.
5. Missteps aren’t fatal
When you try something new, you don’t know what you don’t know. You are bound to make decisions that, with a bit more info, you would have handled differently. This will happen quite often when starting out, and much about growing a successful business involves minimizing missteps. With lower costs and less competition, you can afford to be wrong more often without it being fatal to your business.
6. Smart investors are looking for great opportunities right now
The old adage is buy low and sell high. I’m not sure how much higher Apple, Tesla and Bitcoin will go, but I do know that they are richly priced. The opportunities in the bond market are bleak given how low rates are currently. Smart investors are looking for alternative investments, and there are not a lot of opportunities. Get your business off the ground, prove a path to profitability, and the money will be there for you to grow.
7. Good people are underemployed right now
The pandemic has had a drastic effect on the labor market. There are great people who are unemployed or underemployed. Folks are looking for new opportunities, and there are many who would love to help grow a great company with a great idea. You’ll have the opportunity to be creative around compensation, and you’ll find great employees who will be willing to tie comp to the success of the business.
Overall, the climate right now looks unsettled and scary. It’s tempting to bury your head in the sand and wait it out. But right now is possibly the best time to get that dream business off the ground.
If you need some direction in figuring out exactly how to get moving, we can help!
Feel free to reach out to me directly at firstname.lastname@example.org
I look forward to hearing from you.