Should You Start a New Business After the Pandemic? - The Dough Roller

Should You Start a New Business After the Pandemic? - The Dough Roller

Should You Start a New Business After the Pandemic? - The Dough Roller

Posted: 19 May 2020 12:00 AM PDT

Let's start by looking at some trends before digging deeper into what type of business you might want to start and ultimately, where to find your financing.

Table of Contents:

Should You Start a New Business After the Pandemic?

Whether or not you should start a business depends on a variety of factors. But to help frame your thinking a bit, consider a few pieces of data.

Big Names Have Emerged from Recessions

Incredibly successful companies such as Uber and Slack came out of the last recession–and these are just two examples. Crisis can be the inspiration for new ways of doing things, so if you are sitting on an idea that could help make life easier for people, now might be the time to act.

This just goes to show that the economy doesn't have to be booming for new ideas to prosper. As long as you have a product or service that people want, you price it appropriately, and you market the company well, you can achieve success.

Data Shows More and More People Want to Be Entrepreneurs

According to a study by Babson College, 27 million Americans are either starting or running new businesses. The same study showed that over 50% of Americans found that there was opportunity for new businesses, while 36% planned on developing and delivering an innovative service or product as their core offering.

As more and more Americans are laid off or furloughed, I can't help but think those statistics are climbing, as people consider their options on how to make money. And in today's environment, you no longer need a brick and mortar store to set up shop and make money.

In fact, according to an interview of Joe Galvin, chief research officer for Vistage (an executive coaching company for small to mid size businesses), people who are focused on digital transformation with their businesses have the opportunity to be incredibly successful. He said because people are staying home, so much energy is being focused toward online businesses, and it'll ultimately accelerate the death of the brick and mortar business.

Before you completely decide if it's time to start a new business, read on for more information to help inform your decision.

Industries Doing Well During the Pandemic

Businesses are having to quickly adapt to the changing environment due to the coronavirus pandemic. No longer can companies survive as solely a brick and mortar business, waiting on customers to walk in their door and spend money.

The U.S. Chamber of Commerce put together a list of 15 different types of businesses that are thriving during the pandemic. Many of them come as no surprise, but there are a few I want to highlight.

Delivery Services

Many of us have either been told by our government to stay home or are just too nervous to go out and buy things like food, so delivery services have seen a huge uptick in demand.

A great example is Instacart. The food delivery app recently had to hire 250,000 more workers just to meet the growing demand for grocery delivery during the pandemic.

I can attest to this and the level of frustration I felt during this surge in demand. Before the pandemic, I was able to order groceries through Instacart and have them delivered later that day, no problem.

But since demand for delivery blew up after the coronavirus came, I was either unable to get a delivery or had to sometimes wait a week or more. Now, considering the circumstances, I didn't mind, but it was frustrating to have to project grocery needs that far in advance.

The silver lining, of course, is a tremendous amount of opportunity for delivery. So whether you work for a company like Instacart or you start your own delivery-based service, chances are there will be a high demand even after things calm down.

Cleaning Services

As fear continues to spread from the coronavirus, both corporate and residential cleaning companies have seen a boom in demand.

While it may seem like this will peak during the pandemic, I surmise that these types of businesses will be in incredibly high demand after we go back to work and resume somewhat normal daily activities.

This pandemic has caused us to shift the way we think about everything. For example, have you ever washed your hands as much as you do now? I know I haven't. In fact, my hands were raw a few weeks ago since I was washing them so much with antibacterial soap.

So we want to be clean and we want our environments to be clean, too. Thus, a business opportunity is born for people to clean homes and businesses. Plus, the more sterile you are (i.e., wearing a mask, gloves, and making sure things are totally sanitized), the more business you'll have.

Sean Ludwig, contributor for the U.S. Chamber of Commerce, cites two small cleaning businesses in the article that have seen so much demand they have had to hire more people than ever before to keep up. I can't see this type of demand going away any time soon.

And beyond the traditional cleaning services, enterprises have sprung up to fill the demand for personal protection. Clothing manufacturers across the country first helped to make face masks for medical professionals, but now that the CDC recommends everyone wear masks in public, existing companies have switched production to fill this emerging need.

Fitness Equipment Companies

Companies like Tonal, Mirror, and Peloton are booming right now since people are stuck inside but still want to work out. Mirror, for example, has a "mirror" product that you can stick on your wall and do live workouts while seeing your progress (since it is a mirror, of course).

And we all know about Peloton at this point–their bikes and treadmills continue to sell as people look for a way to get a quick workout in at home, while still enjoying the benefits of a live class (you know, that whole human interaction thing?).

So while these larger companies are seeing success, it doesn't mean small businesses can't, too. Whether you're selling workout equipment or creating a service that allows people to have live, human-interaction (like a personal trainer) from the comfort of their own home, there's a lot of opportunity to take advantage of here.

Should You Open One of these Businesses? Or Join One?

Whether or not you should open or join one of these businesses depends on many factors. You need to address your personal financial situation first. Do you have the capital to start a new business (more on this below)? What happens if it doesn't work out, do you have a fall back plan?

I think now is an amazing time to start a business. There are so many opportunities, and more and more of them are popping up with the pandemic and our new way of living.

So if you think you're ready, you need to go for it.

According to Bernhard Schroeder of Forbes, three of the biggest excuses we typically make for not starting a business are a fear of failure, the fact that starting a business is hard work, and a lack of security that comes from a steady paycheck.

He outlines a handful more excuses, but he makes the point that these excuses no longer matter. For example, he makes an excellent point about "security" with our regular day job. Schroeder states that "the real issue is that unless you work for the government, there is no guarantee of jobs for life."

And he's right. Pandemic or not, there's no real guarantee for your employment. So think about that for a while before you make an excuse.

Where to Find the Capital to Start Your Business

You have several options for finding the capital to start a new business. While all of them can work, some are more desirable than others. But that doesn't mean that a less desirable source of funding (i.e., credit cards) can't work for you if you're smart.

Here are the main options you have:

Direct Lenders

You can get a small business loan directly from a small business loan lender. It's always wise to check with your current bank or local credit union first, but in case they don't offer what you're looking for, I have a couple of (possibly better) solutions for you (though some require that you've already been in business for a while).

The first is Kabbage. You may have heard about Kabbage on the radio or through some other form of advertisement. Their bread and butter is small business lending. You can get up to $150,000 by meeting only a few simple requirements. The downside is that APRs can be high and terms can be short.

The second option is a company called OnDeck. They too specialize in small business loans and offer two different options: term loans and lines of credit.

You can get up to half a million dollars in a small business loan if you've:

a) been in business at least a year,

b) have at least $100,000 in gross revenues each year, and

c) meet their other lending requirements (i.e., credit score, etc.).

Peer-to-Peer Lenders

I think a better option is to go with a peer-to-peer lender (P2P). A P2P lender is one that provides funding through other people. So, you're essentially borrowing money from others and using a lending company as a middleman.

My favorite is Prosper. They're the O.G. of P2P lending as they were basically the first one to hit the market around 15 years ago. While they don't offer "small business loans" per se, you can get an unsecured loan through the platform for up to $40,000 at some pretty favorable rates.

Another option I like is LendingClub. Here, you can get a small business loan, but need to meet certain requirements–among them, be in business for at least a year and have at least $50,000 in revenues. Starting rates are pretty good, but if you have poor credit, rates can be astronomical. Which leads me to my next option…

Credit Cards

Hear me out before you say that you're not willing to fund a new business on a credit card. First of all, standard rates on credit cards can sometimes be better than a rate you'd get with a small business loan–you just have to shop around.

But I'm not talking about standard rates, that's only a backup. I'm talking about cards that offer excellent promotional offers for opening the card–giving you a low APR (or even 0% APR) on purchases and balance transfers.

A great example is the ABOC Platinum Rewards Card. This card gives you 0% APR on balance transfers for 18 months and on purchases for 12 months. That means you can get your business started and pay no interest on your balance for a year.

In addition, you'll get $150 in statement credit after spending $1,200 in 90 days after opening the card. Plus, the card had great rewards. You'll earn a point on every dollar purchased and 5x points–up to $1,500 every quarter–on dining, groceries, travel and gas.

So you can see, using a credit card wisely can actually help you get your business started at a low cost. Check out our complete list of the best balance transfer credit cards and the best interest-free credit cards for more information.

Other Options

Use Your Savings

A riskier option is to use your emergency savings. I don't recommend it, but if you are out of other options, you might consider tapping into your savings to fund your new business. Just be smart about it and make sure you have a game plan for both earning money and a fail-safe if things don't work out.

Borrow from Family

You can ask to borrow money from family, as painful as that might be. In many cases, your family members might help out if you have a good business plan–and they'll be even more likely if you're willing to either pay them back with interest or cut them in on the business profits if and when it becomes successful.

How Are Things Different for Small Businesses Now and Moving Forward?

In the short-term, most of us are working from home, kids are going to school online, and we're practicing social distancing. But what happens in the long-run? How will things change?

The short answer is we just don't know.

According to Joe Galvin in the interview I cited above, this is what's called a black swan event–meaning that it's totally unpredictable and it has a lasting, long-term effect. (The term black swan was popularized by a writer and former trader Nassim Nicholas Taleb, who wrote a book with the same title.) Galvin says that the coronavirus will have a profound and long-term effect on us, and, until we reach the bottom, we won't know how severe the impact is.

We can guess on how small businesses will fare in the future, but that's only a guess. I fully expect people to be more tentative about social interaction–at least for the next year or so.

This means that fewer people will want to shop in brick and mortar stores, go to gatherings and sporting events, or possibly hit the bar for an after work happy hour as often.

And within that lies business opportunity. Think remote services that people can access from their homes and still get the human-need of social interaction.

What Resources Are Available for Me?

As a small business owner (or an aspiring one) there are plenty of resources available to you. To start, here are four of our resources that will help you ideate on businesses to start:

Another resource I found particularly helpful was one that Columbia University put together, which covers possible grants and other support you can find as a small business owner. To name a few:

Finally, a super-robust resource comes from the U.S. Small Business Administration Office of Advocacy. They put together a very deep guide on COVID-19 Resources for Small Businesses. There, you'll find all types of information to help you with your small business during the pandemic.

Related: How Can Small Businesses Survive the Coronavirus Pandemic

Other Banking Services

Once you get your business up and running, you'll want to keep your business and personal finances separate. There are loads of banks that offer small business programs, but one that can be done online is Bank Novo. They are designed specifically for small businesses with a low fee structure. They only offer one type of account–a free business checking account–and it comes with discounts on things small businesses often need, like Stripe for processing credit cards and Salesforce for tracking leads.

Open an Account or Read the Full Bank Novo Review

Bottom Line

In short, do your research, but don't be afraid to take the jump if it's what you want to do. Crisis can be devastating, but they also offer up a chance to innovate. If you've been mulling on a business idea, now might be as good of a time as any to make it happen.

Is a Pandemic the Right Time to Start a Business? It Just Might Be - The New York Times

Posted: 24 May 2020 04:18 PM PDT

In March, as small businesses across the country were shutting down amid the spreading coronavirus pandemic, Shanel Fields was about to open one up.

For Ms. Fields, the timing couldn't have been better. Her company, MD Ally, allows 911 dispatchers and other responders to route nonemergency calls and patients to virtual doctors, to help local governments improve their emergency response systems.

"Something that a lot of people don't know is that more than half of calls that go to 911 are nonemergency," said Ms. Fields, whose father's experiences as a volunteer emergency medical worker sparked the idea. "Those nonemergency calls overcrowd E.R.s and delay ambulances."

But she also recognizes how crazy it sounds to start a business during an economic collapse. She knows that while she's hiring, many small businesses are worrying about whether they'll ever reopen.

She's not alone: New businesses are forming despite the pandemic, though at a significantly slower rate than before.

There have been more than 500,000 applications for an employer identification number since mid-March, according to the Census Bureau, although that is down nearly 20 percent from a year ago. Between mid-March and mid-April, the Small Business Administration issued nearly 300 start-up loans worth about $153 million, a 36 percent drop from year earlier. Stripe, the credit card processing firm, said it had handled more than $1 billion in sales for businesses that started on the platform during that time.

Past downturns produced some high-profile American companies: Airbnb, Disney, General Motors, Hewlett-Packard, Microsoft, Slack, Uber and Venmo, to name a few.

"Downturns or challenging times are seen as good times to start a business for two reasons," said Rashmi Menon, entrepreneur in residence at the University of Michigan's Zell Lurie Institute for Entrepreneurial Studies. "One is, there is less competition for resources. The second reason is that whatever changes we face, positive or negative, bring up new customer needs. And customer needs are at the core of any business."

For Ms. Fields, opening now meant greater access to top talent. She hired her fourth employee and said more than 200 qualified applicants had submitted résumés. And being in the health care sector during a pandemic has raised her profile with funders and governments: MD Ally, which is based in Philadelphia, recently signed its first customer and closed its first round of investment worth $1 million.

For others, the timing can mean low interest rates for borrowing start-up capital, cheaper equipment as businesses sell off inventory or lower lease rates as landlords scramble to fill empty spaces.

"I'm already seeing a huge uptick in requests for kitchen leases and subleases to be used for carryout kitchens or production spaces," said Jenn Smith, a commercial real estate agent in Detroit.

In the best of times, 20 percent of new businesses don't survive their first year, according to federal statistics; economic headwinds present greater challenges. A restaurant or bookstore opening on Main Street, however, faces very different risks from those of a new tech firm whose employees can work from home and whose customers don't need to gather.

"There are going to be industries that are winners, and others that are going to be losers," said David Brown, who co-founded the start-up accelerator Techstars during the 2008 recession. "I probably wouldn't want to be in a business right now that caters to business travelers, but I'd love to be in a business that helps enable telemedicine."

Determining what customers need now, rather than before the pandemic, is crucial. Ms. Menon and Mr. Brown see opportunity in offering solutions to the challenges that people now face: educating their children, working from home, managing supply chains, getting a haircut or the house cleaned, seeing doctors and therapists, entertaining themselves. Even new restaurants might be successful if they consider the future of customer service rather than recreate old systems.

"If you can find innovative ways for people to feed themselves right now, that might make sense," Ms. Menon said. "You just have to address a need."

Figuring out how to open the food hall of the future is the task facing Maarten Jacobs, the director of community prosperity at the Allyn Family Foundation, a regional philanthropic organization in Syracuse, N.Y.

Credit...Mustafa Hussain for The New York Times

That's not a role Mr. Jacobs expected, considering his background is in community and economic development. He is overseeing the foundation's investment in a new four-story, 80,000-square-foot building designed to be a community gathering space and incubator for the city's small food entrepreneurs. A mix of apartments and nonprofit offices is planned for the upper floors, but the heart of the project is Salt City Market, which will feature food stalls run by women and entrepreneurs of color, a coffee shop and a cooperative grocery store.

The project is scheduled to open in November, so Mr. Jacobs is focused on finding the safest way to open a 24,000-square-foot market even as the world is questioning when — and how — people will want to gather again.

  • Frequently Asked Questions and Advice

    Updated June 2, 2020

    • Will protests set off a second viral wave of coronavirus?

      Mass protests against police brutality that have brought thousands of people onto the streets in cities across America are raising the specter of new coronavirus outbreaks, prompting political leaders, physicians and public health experts to warn that the crowds could cause a surge in cases. While many political leaders affirmed the right of protesters to express themselves, they urged the demonstrators to wear face masks and maintain social distancing, both to protect themselves and to prevent further community spread of the virus. Some infectious disease experts were reassured by the fact that the protests were held outdoors, saying the open air settings could mitigate the risk of transmission.

    • How do we start exercising again without hurting ourselves after months of lockdown?

      Exercise researchers and physicians have some blunt advice for those of us aiming to return to regular exercise now: Start slowly and then rev up your workouts, also slowly. American adults tended to be about 12 percent less active after the stay-at-home mandates began in March than they were in January. But there are steps you can take to ease your way back into regular exercise safely. First, "start at no more than 50 percent of the exercise you were doing before Covid," says Dr. Monica Rho, the chief of musculoskeletal medicine at the Shirley Ryan AbilityLab in Chicago. Thread in some preparatory squats, too, she advises. "When you haven't been exercising, you lose muscle mass." Expect some muscle twinges after these preliminary, post-lockdown sessions, especially a day or two later. But sudden or increasing pain during exercise is a clarion call to stop and return home.

    • My state is reopening. Is it safe to go out?

      States are reopening bit by bit. This means that more public spaces are available for use and more and more businesses are being allowed to open again. The federal government is largely leaving the decision up to states, and some state leaders are leaving the decision up to local authorities. Even if you aren't being told to stay at home, it's still a good idea to limit trips outside and your interaction with other people.

    • What's the risk of catching coronavirus from a surface?

      Touching contaminated objects and then infecting ourselves with the germs is not typically how the virus spreads. But it can happen. A number of studies of flu, rhinovirus, coronavirus and other microbes have shown that respiratory illnesses, including the new coronavirus, can spread by touching contaminated surfaces, particularly in places like day care centers, offices and hospitals. But a long chain of events has to happen for the disease to spread that way. The best way to protect yourself from coronavirus — whether it's surface transmission or close human contact — is still social distancing, washing your hands, not touching your face and wearing masks.

    • What are the symptoms of coronavirus?

      Common symptoms include fever, a dry cough, fatigue and difficulty breathing or shortness of breath. Some of these symptoms overlap with those of the flu, making detection difficult, but runny noses and stuffy sinuses are less common. The C.D.C. has also added chills, muscle pain, sore throat, headache and a new loss of the sense of taste or smell as symptoms to look out for. Most people fall ill five to seven days after exposure, but symptoms may appear in as few as two days or as many as 14 days.

    • How can I protect myself while flying?

      If air travel is unavoidable, there are some steps you can take to protect yourself. Most important: Wash your hands often, and stop touching your face. If possible, choose a window seat. A study from Emory University found that during flu season, the safest place to sit on a plane is by a window, as people sitting in window seats had less contact with potentially sick people. Disinfect hard surfaces. When you get to your seat and your hands are clean, use disinfecting wipes to clean the hard surfaces at your seat like the head and arm rest, the seatbelt buckle, the remote, screen, seat back pocket and the tray table. If the seat is hard and nonporous or leather or pleather, you can wipe that down, too. (Using wipes on upholstered seats could lead to a wet seat and spreading of germs rather than killing them.)

    • How many people have lost their jobs due to coronavirus in the U.S.?

      More than 40 million people — the equivalent of 1 in 4 U.S. workers — have filed for unemployment benefits since the pandemic took hold. One in five who were working in February reported losing a job or being furloughed in March or the beginning of April, data from a Federal Reserve survey released on May 14 showed, and that pain was highly concentrated among low earners. Fully 39 percent of former workers living in a household earning $40,000 or less lost work, compared with 13 percent in those making more than $100,000, a Fed official said.

    • Should I wear a mask?

      The C.D.C. has recommended that all Americans wear cloth masks if they go out in public. This is a shift in federal guidance reflecting new concerns that the coronavirus is being spread by infected people who have no symptoms. Until now, the C.D.C., like the W.H.O., has advised that ordinary people don't need to wear masks unless they are sick and coughing. Part of the reason was to preserve medical-grade masks for health care workers who desperately need them at a time when they are in continuously short supply. Masks don't replace hand washing and social distancing.

    • What should I do if I feel sick?

      If you've been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others.

"It keeps me up at night, that's for sure," Mr. Jacobs said.

He's looking at global trends on how restaurants are opening and the safety precautions being put in place to see what he might do in Syracuse this fall. He's considering foot-operated doors, mobile sanitation stations and a new furniture concept.

"In the past, we just wanted to make sure furniture looked cool; now it has to look cool and be built like a tank and stand up to robust cleaning," he said.

But his biggest worry is the entrepreneurs. He doesn't want to set them up for failure.

The foundation supported Salt City Market as a way to foster entrepreneurs who might not have the resources to open their own restaurant. It hosted a community competition to identify eight small food businesses for the market. The winners received months of technical training on everything from marketing to inventory management, as well as the promise of a commercial kitchen stall with all the equipment they need. Chefs are responsible for their own signage and small goods, like plates and napkins, as well as a start-up investment of $30,000.

"We wanted a loan that if everything goes sideways, they aren't crippled," Mr. Jacobs said.

But everything has gone sideways. So Mr. Jacobs wants to open in a way that ensures they can succeed. "We don't want to jeopardize them," he said.

So far, all eight chefs plan to move forward. But several face the hard choice of leaving their day jobs to pursue their dreams, which may have seemed romantic in normal times but is terrifying in a severe downturn.

Chef Ngoc Huynh said she was scared but still excited to open her Vietnamese kitchen in the market.

Credit...Mustafa Hussain for The New York Times

"I like to be optimistic and hope for the best," Ms. Huynh said.

She knows the challenges of restaurant life from watching her mother and aunt run a small food and catering business while working other full-time jobs. But Ms. Huynh is reassured by the fact that she's not doing this alone. She and the other chefs are receiving technical support from the foundation and collaborating on ways to open a restaurant in a socially distant world. The group is considering new menus and hiring delivery drivers to serve all the stalls.

"We're thinking about this together," Ms. Huynh said. "That's the beauty of it. We're all competitors, but there is a network of support."

You want to start a business now? Ms. Menon suggests you ask yourself these five questions first.

  • Have I identified a new need that customers have as a result of the current crisis?

  • Can I serve this need in a way that is substantially better than the current alternatives?

  • Am I qualified to solve this customer problem?

  • If I don't have the experience, can I hire others or find a co-founder to help me?

  • Do I have access to funding that can tide me over until my business is profitable?

Good Entrepreneurs Don't Set Out to Disrupt - Harvard Business Review

Posted: 08 May 2020 12:00 AM PDT

Executive Summary

Disruption is not always destruction. The vast majority of entrepreneurial ventures did not steal their customers from any established business, but rather brought new people into a market. The author writes about co-founding Square. While the company is known for disrupting the payment industry, the author argues that like companies before and after his, Square instead expanded the market. Rethinking disruption as market expansion will help more entrepreneurial ventures succeed, he argues.

Lauren Hillebrandt/Getty Images

Copying is perhaps the strongest force in the world. We are so predisposed to copy that it infiltrates our most innovative institutions, even the self-proclaimed hub of innovative thinking, Silicon Valley. Of course, those of us in Silicon Valley don't call ourselves copycats, we call ourselves disrupters.

When Clayton Christensen first popularized the disruption concept back in 1997, the idea was novel and interesting. But what Christensen originally called disruptive innovation has now been shortened to just disruption and the oversimplification is profound. I hear pitches every month from start ups wishing to destroy the economics of some existing industry. Hidden— frequently well hidden— inside these pitches is the implication that the invisible hand of the economy will reallocate resources so that we will all be better off and enjoy a more efficient world after the carnage. It doesn't always happen that way.

Jack Dorsey and I cofounded Square back in 2009 with the initial goal to expanding credit card acceptance for small businesses. Today, Square merchants represent a healthy fraction of all U.S. businesses accepting credit cards, but to existing merchants and their credit card providers, Square caused remarkably little, if any, disruption. Why? Because instead of disrupting the market we expanded it.

When we entered the market, Heartland Payment Systems was teetering on the edge of bankruptcy, having barely survived the largest data breach in history. A decade later Heartland is still in business, along with every other major credit card–processing firm that existed when we started. True, some of these firms merged or were bought out, but that cycle has been happening in the credit card industry since its beginning. In some ways we compete directly with PayPal, but PayPal is now an order of magnitude larger than it was when we started. At the same time, Square has increased the number of credit card–accepting merchants by roughly 2 million in 10 years.

Our path of disruption has not been one of destruction. This surprised me, and so I looked back on some of the great entrepreneurs of history to see if their paths had been destructive ones, or expansive ones. I learned that the vast majority of entrepreneurial ventures did not steal their customers from any established business, but rather brought new people into a market, as we did.

When Southwest Airlines was beginning, the prevailing "wisdom" was that only the well-off wanted to fly places. As the first low-cost airline, Southwest invited regular people into the skies and found huge success. Herb Kelleher, proudly told me once, that Southwest didn't drive other airlines out of business, but rather increased the total number of travelers. "When we went into the Dallas–Houston market in '71 it was the thirty-fourth largest market in the United States. We were there one year and it grew to be the fifth largest. So in other words, we were just taking all of these people that had never flown and putting them on airplanes for the first time. But the remarkable thing is that all the other carriers increased their traffic on that route as well. We weren't taking business from anyone, we were growing the market." And the effect was not just in the Dallas–Houston market. Herb told me, "We come into new cities, and traffic increases by 272% in the first year."

Of course, TWA, Pan Am, Braniff, United, Continental, Northwest, US Airways, and hundreds other U.S. carriers have plummeted into bankruptcy. But Southwest didn't have anything to do with this, deregulation did. This explains why international carriers like Pan Am that never directly competed with Southwest also failed.

Another famous disrupter, IKEA, also follows this pattern. In 2015 IKEA opened its first store in South Korea. Instead of gutting the South Korean furniture market, IKEA added to it; the two local South Korean furniture makers Hanssem and Iloom both saw in¬creases in their sales, some as high as 10 percent and the entire South Korean furniture market, which had been flat for two decades, saw an unprecedented 7 percent growth the year IKEA arrived. Was there disruption? Certainly, a lot of Korean furniture companies have disappeared; nearly half ceased operations between 2011 and 2016. But this downfall began four years before IKEA entered the market, so it's hard to attribute all change to the Swedish giant.

Is disruption bad? Not by itself. But disruption has also never been the focus of good entrepreneurs. The focus of the entrepreneur should be the people who cannot get paid, or travel, or furnish their home. The entrepreneurs that succeed, and rise to the top of their industries set out to build, not destroy. If disruption occurs, it is merely a side effect.

The focus of the entrepreneur is on the horizon beyond the wall. If we glance at the system, it is neither to copy it nor to destroy it, but simply to see how much more can be done.


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