Jack Mason, entrepreneur and CEO of digital business collective Inc & Co examines why now is the perfect time to be a digital entrepreneur.
Conventional thinking may baulk at the idea of starting a new digital business during a time of crisis. And the COVID-19 pandemic is certainly a global crisis. But the past clearly demonstrates that some of the greatest entrepreneurial and innovative ideas are forged from adversity.
“It’s true that investors can hold back during times of economic uncertainty. It’s also true that finding the right talent can be tricky when you can’t meet people in person. Remote working is also, at first glance, more difficult than getting everyone together in an office. From landing early-stage funding to getting through to your bank, there is no doubt that the pandemic elevates the challenges for every wannabe entrepreneur. But none of this stops right now being the right time to start your digital business,” says Jack Mason CEO of Inc & Co.
Reasons why you should start a digital business during a crisis
Plenty of digital entrepreneurs started out during the global credit crunch of 2008/9. Some failed, but the best ones succeeded, says Jack. Either way, there are definite advantages to launching an online business right now. “I’m not, of course, saying it will be an easy ride. Launching a business and successfully scaling it is never easy, no matter the circumstances, but if you were on the way to launching a digital start-up and COVID-19 is stopping you, don’t let it,” says Jack.
One of the biggest challenges for any new business is finding the right kind of talent. Hiring high quality digital staff is always difficult, particularly when you’re looking for senior level, very experienced people. There is a finite pool of resources of the very best of the best. In normal times, this kind of elite talent is almost impossible to source for a digital start-up, unless it’s rolling in funding.
However, right now there are many people at this level actively looking for opportunities in a new world of shutdowns and furloughing. Lots are wondering how they’re going to even land a new gig. Right now, and for a while to come, I think we’re going to see more available high-level talent than ever before. So, if you have the idea and the resources, now is most definitely the time to begin approaching people who have what you need.
This doesn’t apply only to tech experts, programmers and innovators. It’s also true for all kinds of talent that will help you build your business. From web designers to project managers, marketing assistants to branding experts – you have your pick of the talent pool in a way, as a start-up entrepreneur, you wouldn’t in normal times.
And while it’s also likely to cost you less than in pre-virus times, this isn’t the most important part of sourcing new talent now. Anyone you present with a viable opportunity during this time of prolonged crisis and economic uncertainty is going to stick with you when it passes. You’re not just offering a role; you’re offering a lifeline during unprecedented times. That will go a long way to building a true team with a shared purpose and vision.
Adversity forges innovation and experimentation
“Something else that I’ve seen before in times of crisis, whether personal or economic, is that the entrepreneurial spirit thrives,” adds Jack. “At the heart of all entrepreneurs, whether launching a digital company or any other kind of business, lies the drive to experiment and innovate. In everyday life, markets are less open to change and disruption. But in times of crisis there is a collective expectation that we are all waiting for change of some kind.
“In this time of global pandemic, we’re all trying to find a new way to live, work and exist. This receptiveness to new ideas, to challenging the status quo and finding different solutions to age old problems is transient and will diminish as the crisis passes. But we’re experiencing it right now, and it opens doors to more experimental innovators.”
A study published in 2009, just after the economic crash by the Ewing Marion Kauffman Foundation shows that almost two-thirds of companies in the Fortune 500 were launched during a recession or a prolonged period of a declining market. If this many successful companies started life during what should be a bad time to launch a business, it suggests that the reverse is true.
And while already established start-ups may struggle to maintain any level of success they reached before the pandemic, entrepreneurs with no legacy costs are in a different position, says Jack. “Starting a digital company with a totally blank canvas is advantageous right now. The advantage you could gain may well outlast the immediate crisis and stand you in good stead for the future.”
If you’re ready to go, don’t stop for anything
There are no guarantees for any entrepreneur or start-up owner in the digital space. This is true whether there is a global crisis or not. But there are certain tenets you should hold to increase your chances of success. If you have the following components in place, there’s no doubt in my mind that you should launch your digital company now.
1. An idea that will solve a major problem
This year is presenting us all with innumerable challenges. But challenges mean opportunities for entrepreneurs looking for those ‘killer’ ideas. With whole industries shut down, people working from home and looking after their kids, there are problems that need solving.
Think about companies like Airbnb and Uber. They were both launched after the last major financial crisis, and they solved problems for consumers. People wanted cheaper, easier ways to book accommodation and taxis. Entrepreneurs provided them.
2. Viable funding options
Investors and venture capitalists are still around, and they still want to find investment opportunities. It’s going to be more difficult to secure funding than in the last couple of years, but it will favour entrepreneurs with truly outstanding ventures. Less easily available funding will push the quality of digital innovation up. It will also mean the leaner your business, the more chance of success – and that’s something that will work into the future too.
3. Finding customers
Your job as an entrepreneur is to find enough customers that love your product. If you have a truly innovative idea for a digital start-up, you will find them, global pandemic or not. The first stage for start-ups is always to build this initial customer interest. Advertising is also cheaper, so you should take advantage of that too.
“Successful entrepreneurs drive forward when others don’t. And if your digital business has the killer idea, the resources and the scope to succeed, now is your time.”