If a Startup Depression is Coming, Open an Online Soup Kitchen
As we prepare for our VC coming out party up in DC, I guess you could argue the timing couldn’t be worse. There is so much “sky is falling” chatter right now. Jason Calacanis’ latest prediction:
It’s my (belief) that the economic downturn will be much worse than it is today, and that 50-80% of the venture-backed startups currently operating will shut down or go on life-support (i.e. 3-4 folks working on them) within the next 18 months.
(It looks like Jason asked TechCrunch and Alley Insider to take down their verbatim reprints…Read Full Email Here while it lasts…or just sign up for his email).
Here’s the good news for us: Heck, we’re already 4 dudes and a Rails box. No offices (except for our Starbucks board room), no stupid expenses, tiny overhead….All code, no filler. Recession, Depression be damned. Why does history always repeat itself? Didn’t we learn anything from the nineties. Glowing aluminum signs, Aeron chairs, Killerspin ping pong tables….Get mad.; Bootstrap!
In the previous world (ie a couple weeks ago), VC money was the opiate of the tech masses. One should always see VC money as simply a catalyst for your startup chemical reaction. Even if you don’t have it, the chemical reaction still occurs, just at a slower rate. If VC money is treated as the reaction itself, then you will be in that 50-80% that goes to Pets.com heaven.
Our first little venture is already breaking even. We’re expanding/improving our current product line every week and have two more exciting projects in the pipeline (including an iphone app). Personally, I’m bullish. Every decision we make here at 4What is based simply on whether it makes money. That should be the golden rule in the best of times and the worst of times.


