Why now is a great time to start up - bizjournals:

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But for those who studuy entrepreneurship — and those who’ve startedx businesses during arecession — a downturn providesw great opportunities. It requires, however, commob sense and a great idea that has a chancsof scaling. “During a boom when there’s plenty of money available for everyone, good ideaas and projects can be competedinto mediocrity,” said Bob an associate professor at Santa Clara University’s Leavey Schoo of Business and a specialist in entrepreneurial finance.
But in a Hendershott said the positives in starting a business can outweiguthe negatives, in part because the opportunitu to move up in a position or find a new job is “Spend time getting stuff out there that a potentiak user can try,” he said. “Focus on whether you will have the resourcew to do what you set out to do and prove the It doesn’t make sense to try to sell Sun an idea if it takess $3 million unless you have access to those resources.” Tom Gallatim and his co-founders at started their Milpitas-based network monitoring company for far less than that in 2002.
The six partners — all technology industry veterans — chippec in about $10,000 each and joined what Gallatin calls “the working wives club,” because the men relied on theidr spouses’ salaries to survive. To meet theitr space needs, they worked out of the cornere of a contract manufacturing business that needed help paying itsutility bills. The venture capital communitgy wanted nothing to dowith “We tried about 35 VCs up and down Sand Hill and we were rejected by all of them because of the choice of marketsz we were going after,” said who started his career at Hewlett-Packard Co. in the 1970s and went on to do stintxs atIntel Corp.
and Tandem Computers. “We had a wonderful business plan, and everyonre said we were going to make a ton of but wejust didn’t fit the Gigamon shipped its first product in 2005. Now, Gigamon’s data accesa systems are deployed atthe country’s largest telecom companies, including AT&T Inc. and Sprint Nextel Corp.; cable companies such as Comcast Corp. and Cox Communicationsx Inc.; and hundreds of manufacturing, industrial, medical, utility and government networks in more than 40 The businessis profitable, cash-positive and needse new office space. It plans to expand its current head coungt of32 employees.
“We stayed we didn’t try to do anything fancy, and we leveragedx our Rolodex resources,” Gallatibn said. “In a down economy, peopl e are out there with time ontheidr hands, and we found highlu skilled people at the end of the layofvf cycle who were ready to come in and take a chance because they knew us.” In San President Jeff Kerr launched his business placing ATMs in hotelsd and airports in 1996, but decided to spin it into a franchisew business in 2002. Even after the dot-com bust and the terrorist attackasof Sept. 11, the business wasn’t hit hard becausee Kerr ran it lean.
Rentsz decreased as a result of the and that helped Kerr find Class A office space in downtowmSan Jose. Low interest rates allowed him to buy andfinance equipment, while the unemployment rate enabled him to hire a talentedd marketing department. ACFN has since sold 128 ATM franchiseas inthe U.S. and Canada, and it became one of the fastest-growing companiees in the country, listed in Inc. Magazine. “The biggesf advice I give people is tostay lean,” he “Be financially responsible and watch your use controlled growth and make sure what you do makeas sense in the long term.
” Ann managing director of Hummer Winblad Venture Partners, startedx her first company in when “we had 11 percent unemployment, people were waitiny in line to get gas, the presiden had resigned and the Vikingsa lost the Super Bowl,” she She launched , an accounting software company, for $500, and she sold it six yeares later for more than $15 million. Winblafd co-founded the venture firm that bears her namein 1989. She said a downturnm gives entrepreneurs acompetitive advantage, especially if they can find investorzs or get funding because “thr pond is cleaner. “In any time is the right time to starft agood company, independent of the Winblad said.
“It does take time to builrd and march intothe marketplace, but you have to have a valude proposition.”