While the great recession was ugly for most, it did have a silver lining. Amidst a society where the institution of marriage is in the decline, the divorce rate surprisingly decreased during the great recession. When times got hard, marriages buckled down because they could not afford to get divorced. The risks of failing were higher, thus more work was required to keep marriages alive.
Coming out of the recession, our nation rediscovered a part of its character long-forgotten in the recent decades of prosperity. The trend of “fixing” is making a comeback. Believe it or not, there was a time when people fixed things that were broken, but at some point, it became easier and cheaper to just start over or buy new.
Relearning how to tough-out the rough times applied to the business world as well. While money never really grew on trees, pre-great recession companies certainly acted like it! Today we are seeing more and more companies bootstrapping and cutting lavish or unnecessary expenses. In fact, investors are now demanding this characteristic in companies and companies are responding with more fiscally-responsible business plans.
While the partners at Tech-Rx are natural-born fixers, die-hards and visionaries, this culture is beginning to spread throughout the industry. Companies now have an alternative to failure. Founders no longer have to throw away their hard work and precious time because they can now turn to micro private equity as an option to fix or save their company. As the Bare Naked Ladies eloquently put it, “Learn to lose, it’s easier that way.”
Micro private equity has been a long time coming and there hasn’t been this option for early-stage companies. Now there is. Hopefully with our arrival, and with others surely to follow, more innovative companies and technologies can be saved.
-Steve Hogan, Managing Partner, Tech-Rx