Startups: The Upside of a Downturn

My advice for tech entrepreneurs thinking of launching right now? Don't wait. A recession can be your ally in building a lean, thriving company

In early October, Sequoia Capital summoned executives at its portfolio companies for an urgent meeting to discuss survival in the economic downturn. The presentation at the meeting, titled "R.I.P: Good Times," quickly made its way onto the Internet, adding to fear in the startup community in Silicon Valley and beyond. Sequoia, after all, is one of the most respected venture capital firms in the country, an early backer of Google (GOOG) and several other huge technology successes. One takeaway from Sequoia's presentation was clear: With the economy souring, now is a bad time to launch a venture or to expand an existing business.

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