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START UPS
Despite the doom and gloom, now is in fact one of the
best times for starting a company. By investing now companies
can secure their long term future and come out of the
recession with all guns blazing
reverse. Although at first sight this may sound disastrous, in Yet time and resources will be stretched and access to
reality it helps to underpin success. Plans are subjected and professional market research and industry experts can be
tested to higher levels of scrutiny both by investors and prohibitively expensive. Ignoring it though could be catastrophic,
customers, but this very toughness means the innovation will be costing time and momentum and could even cause the product to
much better challenged and the due diligence more substantial. loose its market window.
If the innovation passes these hurdles, attacking the market will For this very reason Future Horizons recently launched its
be a relatively easy process. In short, business and investors won SME/Start Up Service offering a broad range of pragmatic
in the bad times will be much longer lasting than those secured product marketing services at an affordable cost, including full
in the fickleness of a boom. access to Future Horizons’ market research reports and
The competition will also not be quite so tough, as many of international networking events.
the incumbents will be forced to cut back on their R&D. While Despite the doom and gloom, now is in fact one of the best
the short term gains of cost cutting and hoarding cash are times for starting a company. By investing now companies can
obvious, in the long run they will come back to bite and destroy secure their long term future and come out of the recession with
not protect shareholder value. By taking the lead now, start ups all guns blazing. Granted it will be tougher to prise open the
can seize the initiative and come out of these difficult times in a wallets but there are fortunately still enough investment savvy
very strong position compared with their weakened competitors. people around who invest for the long term, not instant
The increased financial and market pressures also intensifies gratification.
the start up success basics, namely: Whilst this may seem paradoxical, companies that start up in
circle6 Technology is a given … it’s execution that makes the periods of boom are more likely to fail than those set up in
difference economic downturns. In the boom times, just being there
circle6 Be first & “good enough” … market windows close fast guarantees some level of business, in the busts you have to fight
circle6 Learn to compete … there are no high volume, high value tooth and nail for your share of the pie. This puts much more
niches pressure on getting the product and deliverables right, which in
circle6 Innovation is the means to an end … NOT the end itself turn helps develop a long term sustainability.
circle6 Software is a key differentiator, plus it has value … try to That is not to say it is easier, far from it, it is not, but the key
capture some added value to success is a strong focus on product marketing; honing the
circle6 No start up is an island, you are part of the ecosystem deliverables and getting the message out to the market. The
from day one … embrace it bottom line; business and relationships won in a down turn tend
to be a lot more sustainable than those gained in the ‘easy come,
Interestingly it is in the latter regard that most start up easy go’, ‘here today, gone tomorrow’ good times. Solve
companies fail, with the general perceived wisdom being: someone’s problem in a downturn; they will love you forever, do
circle6 “We are so technically specialist, plus we know our market the same in a boom; chances are you will be one of a crowd and
sector well, we are even creating it.” forgotten tomorrow.
circle6 “We are isolated from the greater semiconductor world The current financial crisis will eventually calm down, but not
and have no need to be cognisant of it.” before it over reacts the other way. Just as the boom times
circle6 “We are in stealth mode and don’t want to alert our encourage over-exuberance, so do the recessions cause undue
competitors.” caution and risk aversion. We are part of a capitalist system,
circle6 “We don’t need to network, our idea is so good customers which inevitably means ‘cyclicality’ and associated booms and
will find us and beat a path to our doors.” busts, with a few corporate scandals and out right frauds to boot.
circle6 “We are a small company and have no need, time or But cycle bottoms eventually mean all signals will again be
budget for ‘big company’ marketing tools.” pointing up, causing the VCs and institutional investors to wake
up from the recession deep slumber and get back to business of
For sure cash flow is king when starting up a new business, but building new firms. Greed will bring them back to the
so too is timely access to market research information. Even the equation,(it always does), but by then the smart firms will
best targeted products come unstuck due to unforeseen market or already be on a roll, driven by the smarter, more savvy new
competitive developments, plus it is never too early to make business investor.
markets aware of your ideas. It is also never too early to get For the record, Future Horizons was started on April 1, 1989,
connected with the ‘greater’ industry, especially as most start not just April (All) Fools Day but the start of the eerily similar
ups will be technically, not business, oriented. 1989 global economic recession.
www.euroasiasemiconductor.com December 2008 / January 2009
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