Blog

Get expert advice on every topic you need as a small business owner, from the ideation stage to your eventual exit. Our articles, quick tips, infographics and how-to guides can offer entrepreneurs the most up-to-date information they need to flourish.

Subscribe to our blog

These successful businesses launched during a period of economic slowdown

Posted by Shivali Anand

October 14, 2021    |     3-minute read (511 words)

When the economy isn't performing well, you might be hesitant to start a business. But sometimes, it works out very well. General Electric, FedEx and IBM are three of the most well-known companies that sprang from economic downturns and have survived several periods of national fiscal uncertainty over the years.

Consider the following four firms founded during periods of poor economic growth if you're an entrepreneur seeking ideas.

Kabbage, Inc. 

Kabbage was founded in 2008 with the goal of filling the funding gap for small businesses by using web data to build an automated lending platform. Kabbage has given more than $8 billion to small companies since 2009. Business volume, transaction volume, time in business, social media engagement, and credit scores all play a role in the company's automated funding choices.

"I think it was a real advantage to us to start during an economic downturn," said Kathryn Petralia, a co-founder of Kabbage, at the time of the company's launch. "It gave us the ability to handle adversity and deal with change, and I think it allowed us to really focus on being nimble and flexible."

Since March 2020, Kabbage has been arranging loans to US companies under the PPP (Paycheck Protection Program), a COVID-19 program launched by the US government to assist businesses in surviving the economic downturn. Additionally, Kabbage developed a program that allows small companies to offer gift cards to generate revenue during the epidemic.

The Walt Disney Company 

In 1929, Walt Disney and his brother Roy released the classic picture Steamboat Willie. The first appearance of Mickey Mouse on the big screen coincided with the onset of the Great Depression, yet it didn't stop the firm from thriving. The corporation, which has been in operation for almost a century, has withstood numerous economic downturns and is valued at over $100 billion today.

Delphix

Delphix, founded in 2008, offers database software that enables businesses to use their data as a strategic advantage. Delphix now manages over 14,000 terabytes of data for companies, offering safe, personal data environments to support application development, analytics, and AI while reducing data risk. The firm has over 300 worldwide customers, 350 employees and 10 locations. 

When it comes to launching amid a recession, Jedidiah Yueh, CEO of Delphix, stated: "Scarcity of capital is like drought season in the Serengeti. As conditions improved, firms who were able to stay afloat profited from fewer rivals."

Zeta Global 

Zeta was founded in 2008 to provide data-driven marketing solutions to assist businesses in attracting, engaging, and keeping consumers. The firm employs more than 1,500 people and has 26 locations across four continents, helps Fortune 1000 companies like Samsung, Toyota and Sprint develop their businesses. As per The Wall Street Journal, the company's sales were more than $400 million in March 2020, and it was profitable.

Founder David Steinberg highlighted in a podcast that he has learned to spend money wisely from prior business enterprises. "As an entrepreneur, you learn. There are always going to be highs. There are always going to be lows,” he said.

Learn how we can put more time back in your day.