Quality of New Businesses

This recession has brought some excellent business ideas out of the rafters. I'm friends with a lot of people who work in the area of small business - advisors, mentors, bankers, credit union staff, people who train and work with entrepreneurs every other day. They are all having similar experiences lately - businesses are coming out of the woodwork, and they're good.

I shouldn't sound so surprised, but let's think about it. Recession hits, many lose their jobs, people panic and think "I'll create myself a job." I was concerned that many would start businesses to keep the wolf from the door, without experience or know-how and end up risking what savings their family had left.

It is inspiring to see so many excellent businesses beginning. People are realising that they have had an idea niggling at the back of their mind for so long but never done anything about it because "they never got around to it." Substitute the words "lazy" and "too comfortable" as you see fit.

Now that we have more time on our hands because we cannot afford as many holidays, gym memberships, nights out and costly activities; now that the we know the wolf is prowling around out there but we have a choice as to whether we invite him in, we are thinking.

Innovation is a big push at government level - anyone who watched last Monday's Aftershock on RTÉ1 will have seen and heard a lot of talk around this, and the knowledge economy, or the smart economy. There's tons of it about. More importantly, start-up's are more cautious. Previously thrown to the wind when credit flowed freely, now entrepreneurs are starting to listen to their guts and 6th senses to make sure they don't risk the redundancy package on something that just won't work.

Cleverer, sharper, less reckless, more efficient and more cost effective start-up businesses are sprouting up all over Ireland. Quesions like "who will buy this? what will they pay for it?" are getting answered before investment takes place - previously there was an attitude of If You Build It They Will Come.

This is partly to do with the fact that investment itself is scarce. Delighted to see that Simply Zesty got €500k investment today, on their 1st birthday no less. That's some present! Imagine the competition for that cash. Fair play to them.

Business Angels have never been busier - or more in demand. When margins are tight, what little profits we generate don't need to shoot off into the bank accounts of venture capitalists. Angels are where the demand is...

Moral of the post... Green shoots of hope springing up all over the place.