Airbnb founder Brian Chesky tweeted in early May that "at this point, it feels a little bit like when they started Airbnb in late 2008.". I wrote a long article about Airbnb before, and I admire Chesky's strategic vision. After the 2008 financial crisis, the global economy is now in a downturn. Paul Graham wrote an article when he invested in Airbnb, "Why start a business when the economy is bad?"? Some agree and some disagree. Anyway, read it again.
1. The economy was bad in 2008. Many experts say it was probably as bad as the U.S. economic crisis in the mid-1970s, but it was also the year Microsoft and Apple were born. Microsoft was born in 1975; Apple was born in 1976. This tells us that the recession is not a bad time to start a business, but it is also not a good time to start a business. The truth is, "The economy doesn't matter much when it comes to starting a business."
2. Years of investment experience have taught me that the most important factor determining the success or failure of entrepreneurship is the "quality of the founder". The economy has some impact, but it is negligible compared to the quality of the founder. If you are suitable, you can win even if the economy is not good, but if you are not suitable, you can't catch it even if the draught comes.
3. It is more valuable to spend more time looking for the right partner than to think about the economy.
4. Microsoft's first product was BASIC, which was born in 1975 with demand and value, but if Gates and Allen had started a few years later, there might have been no Microsoft empire.
5. That doesn't mean you should ignore the bad economy, of course. Consumers and investors will tighten their wallets at this time, but this is not necessarily a bad thing. If you can make a product that saves consumers money, it may be very popular. Start-ups are often able to make products cheaper and cheaper because of efficiency, which is an advantage over big companies.
6. Investors will be more difficult than consumers, they are reluctant to invest when the economy is bad, and entrepreneurs need more capital at this time. But in fact, investors should not reduce their investment. Try to tell us that "we should buy when the economy is bad and sell when the economy is good", of course, few people can do it.
7. Fortunately, the way a startup defends against risk is actually quite simple, and that is to run the company as cheaply as possible. Over the years, I told the founders that the most successful people in the business world are actually cockroaches that can't be killed.
8. One advantage of a bad economy is that there is less competition. Because most people will be afraid, for example, at this time, some "hackers" are going to graduate school.
9. You should remember that you are an entrepreneur and an investor, the first investor in the company. Larry Page and Sergey Brin are rich not because their business is very valuable, but because they are the first investors in the project. As I said before, "You should buy when the economy is bad", and today's buying behavior is actually paying for your time.
10. From this point of view, the recession may be a good opportunity to start a business. But remember, people are always at the heart of entrepreneurship. For tech entrepreneurs, the best time is always now.
Airbnb and Uber were both born in 2008.
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