The Financial Crisis: A Survival Guide for Startups

[Michael]

I think this is a useful piece for just about anyone who is running a small business - without alot of time to look up and ask what this big financial crisis means to you.

I think it would be good for various start up business people to talk about what the financial crisis is meaning to you personally?

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Entrepreneurs often focus so much on running their companies that they don’t have time to worry about events in the outside world. Normally, this is how it should be, but the credit crisis slamming Wall Street right now is an exception, and it has deep implications for any startup.
The current mayhem actually began back in 2001. In an attempt to mitigate the economic impact of the dotcom collapse and the Sept. 11 terrorist attacks, the Federal Reserve began a series of interest-rate cuts, slashing the cost to borrow money to 1.75 percent from 6.5 percent. This was great at first: Entrepreneurs could borrow cheaply to build new businesses; consumers could borrow cheaply to spend money on our products.
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Full Story:
The Financial Crisis: A Survival Guide for Startups - GigaOM

[sloppyjoe]

If you have a small business right now... this is a pretty critical time to clean up your balance sheet... be careful about taking on any new debt I would say... Think alot more in terms of cash flow!

People just got lazy with cheap n easy credit - they stopped thinking closely about managing cash-in and cash-out... This crisis may sting in the short term, but in the medium to long term it will be a good thing... those that survive will be alot smarter and stronger!