As I am writing this we are in the midst of the coronavirus pandemic of early 2020. If you are feeling the pains of quarantine and social distancing, you are not alone. These are unprecedented times. The world has been flipped upside down. The economy has been brought to a screeching halt. Many businesses, big and small, are suffering from the fallout of the coronavirus pandemic.
While this is a terrible time for many businesses, this is also a time of great opportunity for those who are eager to start something new.
Top 3 reasons
for why an economic downturn is actually a great time to start a business:
1) Opportunity for Innovation
When there is a recession or worldwide tragic event that disrupts the status quo, ultimately many problems will result. There will be changes in behavior, financial distress, consumer buying activity will change, financial habits will change, business practices will be turned on their head, among many other things. This is an opportunity for entrepreneurs to innovate and to bring new products and solutions to the market to satisfy needs and make urgent technological advancements.
A great example, during the coronavirus pandemic, is the opportunity to develop virtual work solutions. The world is social-distancing, and in many jurisdictions quarantine and lockdown is a legal requirement. So, what does that mean? That means companies and work teams need solutions to help manage their businesses without the comfort of centralized headquarters or office operations. Things like Zoom and Slack are seeing a major spike in usage during this time. What else does the world need to better enable virtual business operations? Think of those ideas and build a business the world needs right now!
2) Good People Need Work
As I am writing this, the United States has seen a spike to 13 percent unemployment in a matter of weeks. This spike follows a period of historical low unemployment which occurred during the greatest economic growth in the history of the country. This is unexpected and absolutely heartbreaking. The current situation leaves many good and talented people searching for jobs. They are displaced for reasons outside of their control and need work, plain and simple. It is much easier to find talented people now, during this economic downturn, than ever before. Whether you are looking for employees, co-founders, or business partners, there are millions of great workers and talent looking for employment. This is an opportunity to build an incredible team.
3) Much Less Competition
Unlike times of great economic growth and strength, when it seems everyone is starting businesses, the opposite is true during times of economic downturn. In the venture-backed startup world, it is often the case that many entrepreneurs go the route of raising big funding rounds and totally eclipse bootstrapping entrepreneurs. During times of economic downturn, investors are far less active, making funding scarce and harder to acquire. This levels the playing field for the bootstrap entrepreneurs, while also eliminating much of the competition we see during times of economic prosperity and growth. If you are a motivated entrepreneur, and possess the hustle and grit necessary to build your dream, an economic downturn shouldn’t change your prospects for success. In fact, you are at an advantage over the wannabe entrepreneurs and those who never have a chance of success without big fat investor checks. Go out and hustle harder during this time and you’ll be at an advantage!
Don’t let the economic downturn scare you. If you have a good idea and a sound business model, now is your time to shine. Roll up your sleeves and get to work. You’ll find that this is a time of great opportunity. While others are scared and reactive, you can be proactive building your dreams and innovating in areas the world needs it most.
While a massive economic downturn is a terrible time for many businesses, this is also a time of great opportunity for those who are eager to start something new.