On: Why to Start a Startup in a Bad Economy (2008)

[peterwoerner]

You can also argue that a recession is a better time than usual to start a company. Your opportunity cost is a little bit less (due to the job market), customers are a looking to save money are, perhaps, more willing to take on risk to reduce expenses, and finally there is more likely to be talent available at a cost you can pay due to layoffs and a slowdown in hiring among established businesses. Anecdotally there are lots of companies which got started in a recession, FedEx + the tech ones written in a sister comment.

[bnonhacker → peterwoerner]

YES. This pertains to the market conditions and even if it's a tiny company, it's still swimming in a pond affected by various macro-conditions.

[rixrax → peterwoerner]

Totally agree. And many bigger projects get canned or put on hold. Potentially making up room for smaller projects to implement a more compact product from a start up ( to get some quick wins ).

[papito → peterwoerner]

This is why investing in small cap stocks/funds always pays off in a recession. They take off like wildfire during the recovery.

[moneywoes → papito]

Do you have any ETfs you like?

[icedchai → moneywoes]

VBK (Vanguard Small Cap Growth ETF) has done well for me.

[papito → moneywoes]

I would not dare give that advice. You take that risk :)

Go with vanilla small cap low cost funds offered by, say, Fidelity or Vanguard.