The dreaded R-word (recession, of course) is on everyone’s minds these days, causing fear of market volatility and making companies hesitant to invest in big capital projects. The U.S. economy is flashing warning signs, as stocks are headed toward bear markets and an economic slowdown was confirmed by Q1’s GDP dropping 1.5%.
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Every other headline in the financial news cycle mentions how companies are preparing for a recession, and it seems like the actions that are taken preparing for one almost speak it into existence. For entrepreneurs, periods of economic uncertainty can be a reason to delay launching a company or product, but history tells us that downturns shouldn’t get in the way of a great idea, since countless successful firms were born in recessionary times.
Speaking of history, let’s look back at a company that some of you might remember, called MTV. For dinosaurs like me, MTV was a cable television channel that played something called “music videos” 24 hours a day. For those under 30, “music videos” were marketing tools that record companies used to promote album sales. Now I feel the need to explain what “albums” are, but I think I’ll go catch the 5 pm early bird dinner special instead.
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MTV launched in 1981 when the economy was still recovering from the runaway inflation of the late 1970s as well as fuel shocks (sound familiar?). The conventional wisdom at the time was that a channel dedicated to music would flop and there would barely be enough videos to fill a week of programming. The concept had been extensively researched by Warner Amex Satellite Entertainment Company, and the brains behind MTV knew they had a great idea on their hands- so they pushed forward, damn the torpedoes. For those of us closer to nursing homes than homecoming dances, it’s hard to explain just how massive of a cultural phenomenon MTV became.
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The bottom line is that a winning idea is a winning idea, regardless of what the broader macroeconomy is doing. For startup investors, we have to always be on the hunt for great young companies and fill our pipeline with investments that can provide outsized returns. We simply can’t use the possibility of an economic recession as an excuse to take our eye off the ball, unless of course, it’s to take a break and watch old Whitesnake videos on Youtube.
Alright, kids of the ’80s:
What was the first music video to air on MTV?
Respond to this email with the answer, and then head to YouTube, turn up the volume, and enjoy your day.
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🎉 Boardroom Investing Training 🎦
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Last week we held May’s Boardroom Investing Training and it was a hit.
June and July will be fun-filled months of training and events! Be on the lookout for our next training event coming in 2 weeks.
Watch Chris dive into previous deals in Boardroom and share what he Likes/Dislikes in a random deal on a CF site.
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+ Doing the Lord’s work – Brewery analytics firm wins Seattle angel investing contest (read more)
+ When will they change the signs to Dollar Fifty Tree? – Discount stores showing strength in an inflationary retail environment (read more)
+ Teslas must have huge ashtrays – Elon Musk commits $33.5B of his own money to Twitter acquisition (read more)
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