California Business Ascent

Why Now?

History shows that when incumbents can't innovate, entrepreneurs do. The incumbents then try to legislate or litigate.

--  Shel Israel, via  twitter

We've been hearing -- and repeating -- that one of the best times to start up a new venture is during a downturn.  This isn't just whistling past the graveyard, or simply wishful thinking.  As has been previously pointed out, some of the best companies were started in times of profound disequilibrium.

During the boom times, there's a lot more noise and crosstalk in the marketplace, as more and more frankly marginal ideas get funding and perhaps even some traction.  At the  Start conference last August,  David Hornik noted that "when guys are leaving McKinsey to start companies, you know things have gotten crazy."  One of the strategic advantages of launching during a period of economic upheaval is that there are fewer other entrepreneurs battling for scarce capital, media attention, and early adopters.

But it's also true that large companies who might attempt to disrupt competitive initiatives with their market power and political influence have enough problems of their own without diverting their resources to stamping out upstarts. The cat's away.

Posted by GCN Staff on January 27th, 2009 at 2:06 PM

Source: http://goldencapitalnetwork.blogspot.com/2009/01/why-now.html