Member-only story
A Recession Is No Worse Than Any Other Time to Start a Business
Why you have just as good of a shot in an economic downturn
On May 6, I got a message from my cousin Stacey, who had just returned from a yearlong maternity leave to the global consulting firm where she’d been working for the past decade. “Well, I will be joining the entrepreneurial ranks shortly,” she wrote. “Got laid off today.”
It sucked. Stacey has a one-year-old daughter, a house that isn’t much older, a big mortgage and expenses, and all the stress that comes with unemployment. But this was also something Stacey had been expecting for a few weeks — and secretly hoping for. She had been kicking around a business idea for a while that was close to her heart — an automated device to disinfect wheelchairs in long-term care homes, like the one where her father (my uncle) resides. Like everyone else in our family, Stacey has a strong independent streak, which ultimately called her to entrepreneurship. (Until recently, she was my only relative with a regular job.) “This is just the kick in the ass I need to get started,” she told me.
Considering how awful it is to be a human now, it seems like an even worse time to become an entrepreneur. Unemployment is soaring. Bankruptcies, too. There aren’t nearly enough PPP loans to make the bleeding stop for small businesses. Businesses everywhere are struggling for survival, barely scraping by on a fraction of their revenues as we plunge even further into the most severe global economic contraction in, well, recorded history. Amid all this, going out on your own seems like a lemming’s leap. There’s nothing to catch you out there, and the rocks below the cliff are extra sharp.
But none of that deterred the entrepreneurs I have recently heard from, whether this is their first plunge into self-employment or just the latest in a series of businesses. Since the pandemic lockdown began, I have seen dozens of new businesses launch, from takeout restaurants and wine delivery services to online camps for kids and virtual tutoring to interior design firms and gardening companies.
The list grows every day. Axios recently reported that accelerator Y Combinator saw an increase of 15% to 20% more applicants for its summer program. Some of the…
