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Downturn in economy can mean new opportunities for entrepreneurs

Downturn in economy can mean new opportunities for entrepreneurs
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First Published: Sun, Oct 26 2008. 07 08 PM IST
Updated: Sun, Oct 26 2008. 07 08 PM IST
New Delhi: Most people would equate a downturn in the economy with bad timing for anything business-related — especially if you’re thinking of launching a new venture. No doubts some folks would think you were (and even call you) crazy!
“What are you thinking? Don’t you know what’s happening to the economy these days?”
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However, believe it or not, some experts say that this is just the time for launching a start up. Just speak to Hitesh Oberoi, part of the team that launched highly successful ventures like naukri.com, jeevansathi.com, and 99acres.com. He believes that “it’s a great time to be an entrepreneur again…. [Companies are] going to try and cut costs, be more efficient; manpower is easily available so it’s a good time to start a company.”
In other words, with employee-related costs expected to come down along with the cost of rentals — those who are innovative have every opportunity to make their mark.
“But what about investors?” you may ask in return. Surely investors with capital feel the pinch with the sliding stock market and are less likely to provide money to start-ups?
Angel investor Dr. Saurabh Srivastava disagrees with this. Like many other angel investors he believes that massive problems generally mean there are massive opportunities, and strong innovative ideas will rise to the top. “If I was doing an IPO I would be concerned. However, if I invest in a startup, it’s 5-7 years down the line that I’ll realize the value. A startup isn’t going IPO right away,” he says. He also adds, “what’s certain is that 5 years from now the market will be much better than what it is today.”
One start-up owner we spoke to echoes these sentiments. Sachin founded Rawzor (a software that compresses raw camera images) about 6 months ago, and said “most of the impact will be positive over time and why we say that is that it will result in market consolidation and there will be a lot more money chasing lot less ventures.”
Overall, it’s not a bad time to consider nurturing that idea into a start-up (if you had one to begin with), and not allow all the gloomy headlines to affect you. Hitesh Oberoi has seen the financial landscape come full circle in the 11 years since he started his venture. He has weathered the dotcom bust, and still come out on top. That should inspire entrepreneurs on the starting block.
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First Published: Sun, Oct 26 2008. 07 08 PM IST