Summary: Fertile Ground For Startups

The article "Fertile Ground For Startups", found at Businessweek.com , points to the fact that the recent recession has done little to dampen the entrepreneurial spirit. Entrepreneur and business woman Caterina Fake believes "the entrepreneurial spirit really thrives in situations of adversity". This could explain the increased number of angel investors from the first half of this year compared to the same period last year. According to the article, history has shown that great companies are built during bad times. One example came in 1939, when Hewlett Packard was created at the end of the Great Depression. There are many reasons for entrepreneurs to take risks like this during hard times including the fact that everything is cheaper, there is less competition and tough times force entrepreneurs to work on their business models earlier. In the United States, startup companies are playing an extremely important role in the recovery, accounting for over 12 million jobs and 20% of U.S. gross domestic product. However, this is not just occuring in the United States, with 5 of the 25 companies listed in Businessweek being based outside of the U.S. The article also mentions how much harder it is to raise capital, take the company public and find business customers during tough times. It definitely takes a lot of knowledge and a certain entrepreneurial mindset to start a business during a recession, but it can be done.