Guest Post

Does Fate Favor the Bold?

by Holly Hamann
11/17/2009

About six months ago, my business partner and I both quit our full-time positions to start a Web2.0 company that builds social features for blogs. We had no funding, no office, a few customers, and operated the company from our savings. We both have families to support, mortgages to pay and college educations to save for. What person in their right mind would quit their job during a recession with no end in sight? Its probably one of the gutsiest moves I've ever made and I sometimes still wake up wondering if I really did it.

Starting a company in the middle of a recession certainly has its challenges. Funding is hard to come by and investors are gun shy. It's tougher to get loans and skilled employees who have jobs are less likely to leave for riskier ventures. Consumers have less money to spend on products and are very selective about what they do spend money on. While all those things are true, with tough times comes great opportunity. There are pools of extremely talented people who are looking for work and willing to take below-market salaries to join our team. Employees are more flexible about relocating, work hours, and job sharing. Commercial property rates are lower and the cost of travel is down. The challenging economy means fewer companies will start new ventures which results in fewer competitors.

From a product perspective, a tight economy and skeptical investment climate forces us to be ruthless in our product development. We don't have the luxury of going in ten different directions and chasing features that are cool but way outside our core vision (we call those "bright shiny objects"). If we spend one day on something that doesn't further the goal of solving our customers problems, we have wasted a precious day. Competitors with more money and resources will eat our lunch if we take our eye off the ball for a minute. And we wouldn't have it any other way. We are conditioned to think fast, test often, be brutal with priorities and involve real customers every step of the way.

We have no travel budget, no entertainment budget, no fancy office or corporate salary. What we do have is a customer base of over 20,000 customers that grows every day. We launch features in weeks, not months. We're able to advance swiftly in a market where others have retreated with a wait-it-out mentality. We are making impressive progress and have overcome hurdles with customers, investors, and competitors. We're even driving revenue sooner than we thought we would.

Being forced to play by recession-era rules is good for our business. Our gutsy move paid off and we're years ahead of where we would be if we'd played it safe and waited. Sometimes what looks like a challenge is really fate handing you a lottery ticket and inviting you to play a bigger game. Does fate favor the bold? Maybe. But how will you ever know unless you find the nerve to try?

Holly Hamann is co-founder of TheBlogFrog and a start-up veteran who has helped launched several successful Colorado-based tech companies.

  1. Congratulations to you and best wishes!
    Sylvia, of Seams to You! and http://www.seamstoyou.com

    Comment by Sylvia Leinweber — 11/17/2009 @ 10:40 AM

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    This post was mentioned on Twitter by EconomyHeroes: Does Fate Favor the Bold? @whengrowthstall http://ow.ly/CZDT

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  3. […] favors the bold? Starting up in recession: http://findyournerve.com/archive/541 […]

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