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upsides of the downturn?

January 3, 2009

Yes, there is an upside to the economic downturn and record unemployment. Lots of us unemployed or underemployed and using our “free” time to explore creative options and ideas we didn’t have time to when we were working…

Kevin Kelleher writes at Gigaom:art predator › Edit Post — WordPress

I wonder what kind of creativity could be unleashed by workers who, though deprived of a steady paycheck, are freed from such tedious tasks. Some could come up with new ideas that help vault the web to a more advanced stage. Others may make micro-contributions that are equally powerful in aggregate. Such creativity could then foster an entirely new generation of startups, which would eventually lure away some of those who had remained at steady jobs all along.

Of course, money will be hard to come by for such labors of love. Some of the best ideas since the last downturn have failed to find a viable business model. A gift economy would be an especially profitless form of innovation. But that notion lies at the heart of the hacking ethic.

Or as Shirky put it, in distilling his notion of cognitive surplus into a general principle: “It’s better to do something than to do nothing.”

Here’s the rest on this subject.

Jason Calaconis talked about the future of start-ups Nov. 5 on his supposedly defunct blog. Here are some of the highlights for me:

2. The Zero Cost Startup
==================
The major cost of a startup company today is very different today than
it was five short years ago. Five to ten years ago, the major costs
associated with a startup were servers, marketing, software,
infrastructure (i.e. office space, phones, etc) and, of course,
staffing. Today, many startups have little to no costs associated with
their servers because they are either hosting on cloud computing
platforms like EC2 and Google Apps or they are running commodity
hardware (i.e. $1,500 servers) at co-location locations (i.e. they buy
a rack for $2-5k a month). Previously, companies would fork over
$2,500 per server per month rental fees at “managed hosting” services.
That era of a $20-30k a year server is ending as folks realize they
are not getting full value from managed hosting services and that they
have cloud computing and co-location options.

Additionally, today’s startups don’t seem obsessed with office space
and associated infrastructure.

This means the marginal cost of a

a full application on a cloud computing platform and market their
service on StumbleUpon or AdBrite and be done with it.

Five folks can co-locate/co-work at a Starbucks or their homes, build

later:

Bottom line: The difference between good entrepreneurs and great ones
is the ability to build a brand. Brands can’t be commoditized, and
features inevitably are.

and:

startup company is now, essentially, the time of the people involved.

13. Make Media Time
==================
In a down market, people with free time get creative. The blogging
boom was not born out of a technological innovation–far from it. In
fact, blogging-style software existed for almost 10 years before the
boom. Blogging broke out because so many folks were laid off–and
pissed off–that they took the time to write down their thoughts.

Flickr didn’t boom because it was the first photo-sharing site. It
boomed because in the 2003-2005 period, a lot of underemployed folks
were traveling and wanted to share their photos.

Bottom line: In a down market, folks get fidgety and look for
something creative to do. What startup can you create that will
inspire the recently unemployeed? Perhaps collaborative filmmaking
software? Maybe a screenplay-writing community? Maybe fotonauts.com
will take off in this recession and become Flickr 2.0?

2 Comments leave one →
  1. January 3, 2009 11:11 pm

    I am one to believe that creativity and labours of love thrive in “hard times.”

    Just look at the history of blogging… the blogosphere started because Mina Trott was laid off from her dot-com job.

    BTW – I’ve started “best of” / “most of” 2008 on my blog and hope to hear from others. It took me 4 days to write the first entry, i’ve been so busy. Come by and share yours!

    dd

  2. January 4, 2009 11:55 pm

    thanks for the invite–i will asap!

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