Having seen other successful companies launch during times of recession, recessions are a time of opportunity for start-ups.
During times of financial crisis there is a clearer playing field with less competition to be negotiated. As other businesses fall away, gaps in the market appear and provide an opportunity for new organisations to fill them. Similarly, while it can be emotional, redundancy can be the impetus needed to spur the budding entrepreneur into action, and the payout offered can provide the start-up funds needed.
Needless to say, economic uncertainty in itself can be enough to put people off from starting up a business, but for those that do, the pay off can be great.
A good idea, is a good idea, and if you’re scared to progress it just because there is a recession on, you are probably using it as an excuse not to progress it. A true entrepreneur is going to do it whatever the environment.
French multi-entrepreneur Alain Bosetti also believes that: “It’s always a good time to set up a business.” But he also believes that: “Today’s climate needs a different type of person to set up a successful company. Today’s successful entrepreneurs are creative. They will find the right solution and the right financing to support their launch.”
Financing can be a challenge for start-up businesses whatever the economic climate, but in today’s environment, it can be even more of an obstacle. However, there are solutions out there. I advise looking beyond the banks for investment.
Italian social media entrepreneur, Marco Montemagno, advises micro businesses, especially web-start ups, to “find the right Angels” and work with Venture Capitalists, Angel Investors and Super Investors who will take a stake in the start-up with the view to an exit once the venture is making money. These options may mean giving up a share of your business, either for the short or long term, but if the choice is part of a business or no business, many would choose part.
Online sites such as TechRanch, a leading business development assistance organisation that focuses on the high-tech sector, is an example of an alternative funding solution for good ideas.
There is always risk when setting up a business, but if you’re confident in your idea and have done the relevant groundwork to be sure that there is a market for it, the economic climate shouldn’t put you off. There may be greater challenges, but there are also opportunities. And as Dr Hasso Kaempfe, German business consultant and former chairman of the board of Mast Jägermeister AG, says: “If you are the first to go out on the sea, the waves are still quite high but the weather forecast is good.”