This is the time to start a company.

With mayhem all about and news media predicating a certain doom, smart money claims this to be the right time to start a company. And I agree (not that I have any money, smart or otherwise).

Paul Graham (Partner, Y Combinator), for example, thinks this is one of the best times to start a business, especially a technology company. Technology, Paul says, progresses independently of the economy. If you have a good idea it is better to start now than wait. If you wait, it may be too late. Chances are you are not the only one with that idea. Your potential competitors may be working on the same concept as you. If you wait for the economy to get better, your competitors probably already have a head start on you.

Don Dodge (serial entrepreneur) is of similar opinion, adding some great reasons why this is a good time to start a company.

  • Easier to hire great employees, which you wont be able to during boom time.
  • Easier to find office space, and cheaply too
  • Office equipment and furniture can be had for less money

And perhaps most importantly Don says, if your product provides real value, customers looking to improve productivity are more willing to hear you out and perhaps even buy from you.

If that’s not enough to convince you, listen to Melissa Chang (President, Pure Incubation) and Caterina Fake (Flickr, co-founder) who echo Paul’s sentiments. Melissa’s five reasons on why this is a great time to start a company (written in March 2008) resonates well with Caterina’s six reasons why starting a company in boom time is not a good idea (written in March 2006).

One of the interesting points they both make is lack (Melissa’s point 4) or abundance (Caterina’s point 2) of competition. In bad economic times few companies will be started and hence you will have a head start when the conditions change.

However, if the economy is doing well, everyone and their dogs are starting companies and getting funded. Even if your product is better, you still have to deal with a shoddy product from a well funded competitor.

But in my opinion, there is no bad time to start a company. If you have entrepreneurial character, which implies resourcefulness, persistence and perseverance, economic conditions should not deter you from starting a company.

So if you have a great idea, I only have one question. Why are you still reading this?

Next

5th Annual West Midlands ICT Cluster Conference

4 Comments

  1. its a very good idea to start a home brew business when there’s a recession on, people like to brew their own beer and save money!

  2. Everyone is looking at starting businesses, there’s even a competition for it…..

    http://tinyurl.com/4ttq43

    James

  3. Completely agree Rayhan, there has never been a better time to start up a business; there are so many opportunities through a credit crunch.
    I agree with Dons points above, but realistically you can have all the staff, space, office furniture and cheap fuel but none of it is needed. Companies need real help, tools and services that will help them through the tough times ahead, that is the only way they will BUY.

    If a new start up business can’t offer that, I would think very hard before making the decision to start now.

  4. You are correct Ian. Both start-ups and established businesses have to do things differently. It’s no longer business as usual environment anymore. Companies have to deliver not only cheaper and faster, but have to come up with more innovative solutions that customers actually want.

Leave a Reply

Powered by WordPress & Theme by Anders Norén