What do Microsoft, Mailchimp, Uber, Slack and Venmo have in common? Each of these industry titans, these household name companies that most people use almost daily, began during a recession. Today, the novel coronavirus pandemic has sparked mayhem in the markets, record unemployment, health and wealth insecurity, and a general tone of distrust and dejection. But somewhere, in someone’s garage, America’s next industry leader sits in idea form on a white board.
Beginning a business at a time like this feels like peering out over the high point of a rollercoaster. A tumultuous journey stands between you and whatever comes next. It’s been an incredibly challenging year. Nearly everyone has been affected by the virus in some way, whether through the health outcomes of loved ones, the loss of income, or the disruption of daily routines. If you believe your small business idea has the power to aid in our recovery, to ease people’s plight or simply introduce a small positive moment in somebody’s day, the time to begin is now, and the need has never been so great.
Since this time last year, there have been over 1.5 million Business Applications filed, meaning 1.5 million more people have sought an Employer Identification Number for their new business. According to the United States Census, that’s 82.3% higher than the application count for 2019.
Many of those 1.5 million entrepreneurs have successfully identified the pockets of opportunity amidst the COVID-19 chaos. Consider, for example, the task of borrowing startup capital. Interest rates are unbelievably low, and many larger companies have come out with support packages for early stage ventures. Further, cheap equipment abounds as other companies choose to liquidate their assets and sell inventory at discounted rates.
Borrowing capital, securing equipment, and growing an audience are some of the main hurdles for fledgling companies, all of which are made easier by the confluence of market factors that are at play. But in truth, no one should start a company because it’s easy. They should start because something is missing.
Finding Your Value
In an April post for his blog, Bill Gates commented on the role of innovation as a means of navigating times like these. He mentions that innovations at the time of World War II—radar, torpedoes, and coding—helped bring an end to the war much sooner. While he goes on to speak about the need for pandemic-related solutions, such as treatments, vaccines, and testing protocols, the call to innovation goes beyond the medical realm, and might include the idea you’ve been sitting on.
When it comes time to hone in on your could-be-company’s mission, turn first turn to the world that’s happening around you. As all parts of our world are being reconsidered—from supply chain processes to a morning commute—new needs are popping up by the hour. Times have changed, and the shift has left some gaps between consumer demands and market solutions. If you can make any part of this year easier, even if only for a small audience of people, you have a business idea.
Remember, though, that the idea and the founder have to match. You might recognize a need in the market that you’re not equipped to fill, whether it’s a matter of interest, skill, or acumen. The COVID-19 economy is rewarding purpose-driven ventures, those that have set out to solve a problem that only they could solve, and that have developed a team around them to share in that pursuit. Begin with the mission that feels like it’s yours, that gets you out of bed and stays with you until you fall asleep. Then consider how you might share it with the world.
With a purposeful mission as a kind of night star, your work begins. But you don’t have to do it alone. Although it may seem far down the line, early stage hiring is another aspect of entrepreneurship that the pandemic has significantly altered. In most industries, a significant amount of talent was shed through COVID-19 cut backs. That talent hasn’t disappeared.
Recently, Upwork released a report that cited the GDP of freelancing income at nearly $1 trillion. That represents 5% of the total U.S. GDP, exceeding some major industries including construction and transportation. Freelance platforms such as Upwork are helping early stage founders connect with the talent they’re looking for, with thousands of qualified freelancers equipped for any imaginable task. The appetite for project-based work has never been greater, and now, the top talent has time.
What’s more, virtually everyone has adjusted to working from home. It’s never been easier to connect with a new team across the wires, without being burdened by the cost of physical space. With more people having invested in video conferencing, home offices and cloud sharing technologies, you can collaborate with new workers from the comfort of your home without sacrificing productivity or quality of work. The world is at your fingertips, and your company can certainly take shape in your living room.
Equipped with a remote team, small or large, the next place of focus is grant sourcing. To promote and maintain economic diversity, many organizations have made funds available to new founders. The Small Business Administration has offered both stimulus and relief packages to ventures impacted by the pandemic. Investment activity remains high as investors keep an eye out for the startups that will mold our new normal.
While it might not be a particularly forgiving economy, startup capital is still there for the taking. With a well-developed business plan, it can go a long way. New founders should consider how much funding will suffice until their business is profitable. COVID-era ventures shouldn’t count on establishing a quick cash flow, but should instead put themselves in the best position to survive a slow couple of quarters. Planning for slow growth ahead of time is the best way to optimize your spending and maximize the reach of your funding.
When it comes to facing the unknown and beginning your business, there may never come a ‘perfect’ time. 2020 isn’t without it’s complications, but it’s presented unique opportunities for purpose-driven people who are ready to come to market with ideas, improvements, and solutions. If your passion aligns with a gap in the market, you’re in a great position to try your hand at COVID-era entrepreneurship. With a resilient spirit, a considered plan, and the funding you need to get started, it’s time to buckle up and (try to) enjoy the ride.