Downturns are Moments to Make a Move
By Tripp Baltz, Head of Research, Boomtown Accelerators
When economic waters get rough, a natural response is to batten down the hatches and hunker down until the storm passes.
But savvy corporations know their history: An uncertain environment is the best time to advance innovations that will flourish when the economy turns up again, as it inevitably will.
Indeed in recent decades there are several examples of companies and industries that were launched during moments of great economic unrest. A recent report by AdAge notes that radio became the predominant form of news and entertainment during the Great Depression.
Other examples from the report:
- Microsoft was founded in 1975, during an economic crisis sparked by skyrocketing oil prices;
- Apple followed a year later;
- That same year Atari introduced the “Pong” video console, helping to launch a form of home entertainment that would evolve into the $220 billion gaming industry of today;
- Major innovative developments occurred during the recessions of the early 1980s: IBM introduced its personal computer in 1981; Cable TV giants — including CNN, USA, Bravo, Cinemax, MTV, The Weather Channel and Lifetime debuted in the first three years of the decade; The FCC awarded the old AT&T the first permit to build a cellphone system in 1982; and, online services CompuServe (1979), AOL (1985) and Prodigy (1988) got their starts;
- During the Great Recession of 2007-2009, Netflix, first seen as a competitor to Blockbuster, launched its streaming video on demand service;
- That same year, 2007, Apple introduced the iPhone;
- Google’s Android OS began powering competing mobile phones in 2008;
- By 2009, Facebook (founded in 2004) had supplanted MySpace as the dominant social network.
- The Great Recession also saw major innovations that have revolutionized the transportation and travel industries: Tesla produced its first electric car in 2008; that same year Airbnb launched its web site; and Uber Technologies was founded in 2009.
As the old saying goes, “When the going gets tough …” Well, you know!