COVID-19 has created global health crisis and also a global economic crisis.
Many people around the world have lost their jobs, many businesses have closed their doors and many countries are likely entering a period of economic recession.
Is this a good time to start a business?
This is a question that many people around the world with a good business idea are asking themselves.
We believe the answer is yes.
It might seem counter-intuitive that a global pandemic or economic downturn would be a good time to start a business, but economic downturns and periods of great challenge can create opportunity for entrepreneurs and small business.
We spoke with Alec Lynch, Founder and CEO at BrandCrowd, an #OpenWeStand partner, about finding opportunity in crisis and why now might be a great time to start a new business:
Of course, it has to be the right business — you can’t ignore what is happening in the world and your market — but for those able and willing to start a business right now, there are a number of unique benefits and opportunities to doing so.
Here are 7 reasons now is a good time to start a business:
1. Things are cheaper right now
There is no doubt that many things are cheaper right now. Many small and large businesses are providing discounts to encourage customers to continue buying during this time. This means the cost of buying what you need to start your own business is probably lower.
There are also many free services available at the moment to help you start a business. For example, GoDaddy is offering free websites right now while our business (BrandCrowd) is offering free logo design.
2. Adversity creates opportunity
During periods of adversity, people experience new problems and needs. Social distancing, health (including mental health) challenges, economic pressures, and working-from-home challenges are good examples of particular problems people are facing at the moment that people want solved.
What we are seeing on BrandCrowd and DesignCrowd is that many people are still starting businesses (and buying logos and graphic design) and, in fact, there are some industries where more people are starting new businesses right now. We’re seeing increased demand for logo design for wellness, medical, esports, technology, fitness, and delivery businesses.
3. There is less competition
Because of the challenging and uncertain times, there may be less competition for your new business should you choose to start one. Some incumbent businesses are closed or will (unfortunately) fail and many people who would have otherwise started a business will not be able to. As a result, if you can start a business now, there’s a good chance you will have less competition.
4. There is special support for small business
Governments, non-profits and large businesses are doing many things to support small businesses during this time. Government websites are a good way to identify what government assistance is available while other sites like OpenWeStand.org lists resources from bigger businesses (like GoDaddy, Slack and others) that are being offered to help small businesses.
Crowdfunding is another way to source financial support. GoFundMe has a special coronavrius small business relief fund for small businesses impacted while Kickstarter data is indicating that support for projects remains strong.
5. Interest rates are low
Generally speaking, interest rates are currently at very low levels. Loans or other debt can be a good way to fund a new business and this source of finance may be particularly attractive at the moment. For new businesses, small business loan providers like Kabbage can be a good option while existing businesses may be able to take advantage of government loan programs (like the Paycheck Protection Program in the U.S.).
6. It’s a good time to hire
Sadly, many people have lost their jobs due to the COVID-19 crisis. If you’re starting a new business (or running an existing business), it’s a good time to hire because there are so many talented people out there looking for work.
7. It’s never been easier to start a business from home
If you are starting a business, chances are you will need to start it from home. Buying a domain name, starting a website, creating a logo, ordering business cards can all be done online from the comfort of your home, and it’s never been easier or cheaper to do so.
Speaking from our own experience, starting a business during a downturn can work and the above benefits are real. Our own company (DesignCrowd.com) launched in September 2007 from a family home with a laptop and a credit card. A few months later, the global financial crisis started. Despite this, what we experienced was that customers flocked to our service even during the GFC. People were still starting businesses, they were interested in a new way to get design done and they wanted to save money. Today, 12 years later, our small business employs 50 people and each month (through DesignCrowd and our new website BrandCrowd.com) we help 20,000 small businesses from around the world get logo, graphic, and web design for their business.
If you have a business idea, it may be feel scary to start now but it may be the perfect time.