Fear No.2: Economic Uncertainty
Five years ago, the economy may not have been of forefront concern for a startup entrepreneur. But today, businesses big and small, young and old, are worried about what the declining economy means for them.
According to the January 2009 “American Express OPEN Economic Pulse,” report, 66 percent of small-business owners surveyed said they are stressed out by the state of the economy; 44 percent anticipate the economy will get mildly or much worse over the next 12 to 18 months; and 50 percent expect the economic climate to negatively impact their business prospects within six months.
But many small businesses have started, innovated and grown during a recession. Bill Hewlett and Dave Packard established Hewlett-Packard during the Great Depression; Orbitz.com went live during the dotcom bust. Jim Koch, a well-known entrepreneur, himself launched The Boston Beer Company and Samuel Adams during the early ’80s recession.
When Koch was getting started, market conditions were less than favorable. Small local breweries were closing all over the country, and his father, a fifth-generation brewmaster, was even forced to retire from the beer business. “In 1948, there were 1,000 breweries,” he says. “But when I started, 97 percent had closed.” Nonetheless, Koch powered through, coming out not only alive, but also ahead.
During that time, entrepreneurs weren’t opening breweries, and the megabreweries were selling mass-produced light beer. The state of the economy “blinded people to the need for somebody to make a great beer,” Koch explains. Entrepreneurs are notorious for going against the current, so a bleak market can actually mean more opportunity.
Photo by LifeHouseDesign.
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