Sramana Mitra, an entrepreneurship and strategy consultant and author of Entrepreneur Journeys, echoes the sentiment. She says she’s fighting the recession by encouraging people to be entrepreneurs. Well, that’s got to be more productive than Paris Hilton vowing to help the economy by shopping as much as possible (as she did a few months ago). But why should a recession be good for start-up leaders?
First, since a recession weeds out weaklings, it’s a time for the stronger to get underway. During a boom, you don’t need as much talent to succeed; the environment helps you along. Even the mediocre do well because the market is flooded with opportunity. A downturn offers particular opportunity for especially smart people willing to work harder. They’re the ones who discover their full potential and find ways to solve the toughest problems.
Second, bad times, just like good times, never last forever. A recession is as much a part of the economic cycle as is a boom. Nevertheless, in tough times people tend to let their emotions and judgment be colored by the uncertainty they feel. They end up behaving as if the world will always remain the way it is right now. But good leaders don’t get stuck that way. They know how to take their eyes off the short term and try to see how things will shape up in the future. And then they don’t just sit there gazing; they go ahead and start the process of building that future.
Third, a recession is a time when you know the environment is hazardous, so you remain cautious and tread slowly. Good leaders and entrepreneurs run their start-ups on the thinnest budgets possible, making sure they remain agile at all times. In the words of Paul Graham, programmer and start-up guru, recession offers you a chance to be the cockroach of the corporate world. The immediate cause of death for a start-up is always running out of money. The cheaper your company is to operate, the harder it will be to kill. A recession forces you to be as thrifty as possible and that helps it thrive even in the worst of times.
Leadership Takeaway: Recession can help you build a recession-proof business. Take advantage.
Sangeeth Varghese is the founder of LeadCap, a leadership organization in India, and is author of Decide to Lead. He can be reached at email@example.com.