Shock, Vibration and Noise Blog

I suspect too many of us were running too close to our financial margin to fund a startup when this hit.

Or - look at I-phone apps.

Why then are we not seeing an increase of the '"two guys in a garage' type business start-ups? Is it simply too soon in the cycle?

How do you know this isn't actually happening? Or are you misinformed.

New business start-up and becomeing a household name within a year does not happen to all start-ups.

phoenix911

because the internet bubble has passed?

The conventional wisdom is 3 years before your new venture shows a profit. Til then nobody will notice you unless you are somehow getting some PR ; like "See what JoeX famous for his job at XYZ corp. has just done" or "ABC venture capitalists have just provided 2nd round financing for...." or the last reporter on the payroll of the local newspaper is looking for a feel good story and just heard about your venture.

Beyond that you need both mental and financial bandwidth to do a startup. These factors tend to reduce in all of us during recession times. We work harder to keep our jobs and often take pay cuts. But seldom are the monthly payments reduced. The market opportunities that were so tempting in good times seem to disappear when everybody is tightening belts. Government stimulus money is usually about producing jobs right now rather than developing new goods or services that we have always done without or may not produce something of value years from now.

Opportunity is about catching what money is flying around. Trouble is there is not much of that in the goods area. Look at what people need and want. Look where people are spending what money they have to spend. Learn how to survey your potential market. Then invest a good piece of your discretionary bandwidth doing just that. Much better to find and confirm the need than invent something and go look for someone to buy it.

People need help with dealing with creditors, foreclosures and bankruptcies.

People need help doing repairs themselves. Stuff they used to pay others to do. This includes food preparation, auto and appliance servicing and home repairs.

People need things that keep their old necessities functional so they don't have to buy new.

People need ways to keep kids occupied without having to buy a continuous stream of new toys.

People need software to keep their old computers functional rather than just buying new every year.

People need better ways to manage and budget their money, something they never had to do before.

People need help coping with unavailability of health care, often due to job loss or just plain increasing costs.

There are a lot of people that just need a place to live.

There are people who deeply fear the possible increase in civil unrest from decreasing government budgets for law enforcement and increasing desperation of the unfortunate victims of bad economic times.

People need ways to get educated without paying high tuition costs that they have no money for.

There are people who still have money to invest and they are looking for bargains they can hold and turn into profits when times improve or just flip now for the fast buck.

People look closer to home for recreation and vacation opportunities.

People look for ways to reduce living costs like home maintenance and energy costs. So do businesses.

And always remember that you the engineer are one out of every hundred people. You tend to be quite unusual in the way you think and the things you prefer. You may think that gadget you just invented is just what the world wants because it looks great to you. But if you expect to make any money off of it it's got to look good enough to buy to the other 99.

Ed Weldon

I guess I'm ahead of the curve. I got laid off in 2001, and became a contract worker/consultant for several competitors of my former company. That was fun, kept me busy 3-4 days a week and paid the bills. I've always been a pack rat and hoarded old lab equipment that was being thrown away. Opportunities came and I finally invested in myself and my abilities and built a small research lab in a storage room in my garage.If I wouldn't invest in myself, why should I expect someone else to? Things went well and I finally added more lab space and made a pilot plant in the garage (5 gal reactor on a fish fryer burner). Now my car sits in the yard while I work in the garage. Several of my colleagues have been laid off and I offered them free lab space to bring in projects and work on them if they wish. So far, only 1 taker for 1 project. I suspect many are intimidated by the thought of going it on their own and prefer the security of a big company to work for. Yes, it IS scarey to assess yourself and business prospects, and see areas where you lack critical mass. But when failure is not an option, you do what you have to do. A key component is to network with colleagues who have business skills (sales, marketing, financial, customer base) which compliment those you possess (technical knowledge, research experience, product development). When you and a colleague combine complimentary skills, you bring a powerful synergy to the market that neither could do alone. That's the difference between one laid off guy puttering around in the kitchen, and another laid off guy shuffling papers and reading want ads; and a laid off guy showing samples to a prospective customer made by a laid off guy working in a kitchen. I love what I do and work is fun!

Good for you.........your said it. When doing it your self, one has to get these done also;

(sales, marketing, financial, customer base) which compliment those you possess (technical knowledge, research experience, product development).

As well as AP/AR.

phoenix911

Wcfloyd -- "If I wouldn't invest in myself, why should I expect someone else to?"

GA to you, wcfloyd! Your approach to the "Sea of Opportunity" is worth taking a long look at. A workshop and a set of skills to go with it is a wonderful asset. Multiply that by your genuine interest in the work it may enable.

Two other elements are important and they are not always easy to add:

1. People need to know what you can do for them as well as the practical limits of your personal resources of time, energy, knowledge and material things (the last two are your "tools")

2. People need to be able to trust you. An impeccable reputation for personal integrity is perhaps your most valuable asset.

Ed Weldon

2. People need to be able to trust you. An impeccable reputation for personal integrity is perhaps your most valuable asset.

Thats true, one thing though, get mixed up unknowingly with the wrong people. they can tear down 20 years of integrity you built in less that 6 months, and you don't realize it till its too late

Life is full of potential pitfalls, whether they be connecting with the wrong people, suffering a debilitating injury or something else. Some combination of intelligence, wisdom and street smarts protect us from such pitfalls. If a shortage of such attributes causes someone to suffer a loss so be it. Life is cruel and each of us is the captain of our own ship.

Ed Weldon

true for the most part. except your statement of "life is cruel"..........I guess I'm more of an optimist, I actually believe that life can be cruel, if you let it.

".....life can be cruel, if you let it"

Well, for the most part I think you are right. But sometimes we take a risk and lose. And there are times when demon randomness catches us.

I can be an optimist at times when I'm able to push back the cynicism. Then I incline toward the old saying that goes something like "You make your own luck".

Ed Weldon

luck is the residue of design,...

being able to make good character judgements has nothing to do with with my " luck " , but everything do with with " your " intentions:

if deceit and " your " acting skills are proficient, " you're gonna rob me.."

ahuha,

I believe I am a trusting guy so for the most part and I agree with Ed, but your last opinion rings loud, and does not matter how good you may think you instincts or gut feelings this is very true.

if deceit and " your " acting skills are proficient, " you're gonna rob me.."

phoenix911

There is a large pecentage of our population that relys on the Goverment to provide their means of support,,while this acts as a slight drag on our economy,all is not lost.

Road construction,construction of any sort,is provided by the Spanish community.This is a good thing.I fully expect that these,responsible,rebar-tying,cement pouring,happy to work,Mexicans,will in time be a much stronger knit organization.

History/evolution has shown that the strongest survive.

Eventually Mexico will realize its most important resource ie: manual labor.Perhaps someone in the Mexican Goverment will realize this and act accordingly.

Just my 2 cents

Joe in texas