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Start Your Own Business, Now

Posted by Internet Guru
November 10, 2009

With the national unemployment rate near double digits and credit markets tight, now is a great time to start a business. Really, it is. Think about it: thousands of workers can’t find jobs, so the talent pool is large and cheap. Good jobs seem less secure as companies cut hours and salaries so people are more likely to risk working for a startup. True, loans and venture capital funding are harder to secure. But even that is more of a hurdle than roadblock. Bootstrapping an entrepreneurial idea with your own capital is often the best way to go, says James Shein, a professor at the Northwestern University Kellogg School of Management. “It’s so hard to raise money during a recession that people now have to sort through their ideas.”

Many successful companies were started during periods of economic downturns, including Microsoft and Southwest Airlines. These businesses don’t share any single startup formula for success, according to business historians. Instead, it is a combination of luck, good ideas, and the willingness to work killer hours. In the case of Microsoft and CNN, having charismatic

leaders such as Bill Gates and Ted Turner also helps. “Most really good businesses tend to have someone in charge with an evangelical belief in the product—people who will give up their lives to get this done,” Shein says.

Microsoft was, for example, incubated during the recession and oil crisis of the mid ’70s. The company began modestly in New Mexico in 1975, when friends Paul Allen and Bill Gates developed a computer language for personal computers that was quickly copied by other programmers. In an open letter to software writers, Gates called for an end to unauthorized copying and made the case to have coders be paid for their work. By 1981, Gates had expanded his company and partnered with IBM, which ran Microsoft products and operating systems in its new personal computers. “Despite the fact that it started in bad economic times, Microsoft was providing services for a booming product,” says Richard D’Aveni, professor of strategic management at Dartmouth College’s Tuck School of Business.

source: newsweek

Small Business

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