Why the recession is good for software entrepreneurs

October 15, 20081 Comment
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We have heard plenty of doom and gloom about the recession recently, but in my opinion the recession can be good for you. Good for both software entrepreneurs and for business in general.

Less is more.

Its a lesson loads of companies are learning now, with the current economic climate, and all too often should be a applied to both software and design. Shaking off the desire to provide feature X is easier when time constraints and money is tighter. The guys over at Contrast have a great post on the benefits of this, and well the recession is a pretty big constraint.

Companies are getting rid of the bloat, and doing whatever it takes to get a product out the door and to market on time. The fear of feature creep is more omnipresent than ever, and over all we are more likely to see products shipped that are minimal in design, and do exactly what they say on the tin. With no shiny extras.

Good indicator of the market

It’s never been a better time to do market research. If you find that there is a gap in the market for a product you are developing NOW, well then it stands to reason that it will sell like hot cakes when the going is good.

Alternate product revenue streams

If however things aint so great, learn to value engineer things. In other words, reduce the cost of the elements that go towards making it, or get rid of feature X to make it more attractive. The result may actually be a superior trimmed down product.

Repackage your products so they become more affordable and attractive to another market segment. When business is slow, you need to search alternatives that put extra revenue in your pocket, this could end up producing an alternative product revenue stream that you hadn’t already thought about.

Ideas are more solid

Recessions force those in business to think and work harder. David Behan has noted why the internet is good for a recession as well, from a sales and marketing perspective. There is no more room for crazy ideas that *might* work. Everyone concentrates on the concrete. Investors are more frugal and won’t chase pipe dreams. The result are ideas that will really stand the test of time, and are more likely to be essential features in your software.

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About the Author ()

Paul is a regular 30 year old web bloke / programmer with a penchant for online marketing. This blog is a personal outlet, with an eclectic mix of articles.

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  1. I agree that things aren’t all “doom and gloom” for the software industry.

    In fact here at Capterra, a website that connects buyers and sellers of business software, our vendors haven’t seen that at all. In a recent survey they reported
    steady (and even increasing) software sales, and leading indicators such as web traffic and sales leads have also remained strong through the financial turmoil.

    I suppose this could change, but right now things seem positive. For more details on the survey click here: http://www.capterra.com/press_20081015

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