Throughout history, tenuous economic situations and growing fears of change and collapse have always sparked innovation. Dating as far back as the Roman Empire we can see examples of great innovation that paved the way to create society as we know it today. Just as their global empire made extraordinary inventions immediately prior to their downfall (including modern sanitation systems, roadways, and even the first surgical tools), modern economic crises have also lead to incredible innovations and the founding of impactful new companies.
Some of the best examples of this type of ingenuity can be found by looking at the great companies that have risen from the ashes of a struggling economic situation. Each of these origin stories all speak to the power of innovation in the midst of uncertainty.
With only $538 of investment money to work with, Bill Hewlett and Dave Packard started what would become one of the countries longest-standing companies ever – right from their garage. Even though it was not yet a focus in the country, they zeroed in on the fledgling electronics market and became the go-to company for testing and evaluating new electronic equipment. They scored their first big deal with Walt Disney in 1938 providing testing and measurements for the production of the film Fantasia. A year later, they officially established the company and are now one of the most successful organizations in the world. Dave and Bill founded HP right during the Great Depression, and the economic pressure they felt helped motivate them to create what some now refer to as the “birthplace of silicon valley.”
In 1958, the country was going through what would come to be known as the Eisenhower recession. Due to failing car sales and soaring interest rates, the country experienced a balancing out during the post-war boom of the times. The recession only lasted about 8 months, but the crisis sparked the birth of one of the most successful companies in the country – millennial favorite Trader Joe’s. By curating a diverse and extremely-high quality list of goods, TJ’s was able to differentiate itself from other grocery stores by offering new options for people who were craving a more personalized and unique shopping experience. This is a perfect example of how even during times where money is tight, services that excite people and fill a gap in the market can still create a loyal base of customers and put a surge back into the economy.
Online & Mobile Banking
Jumping to more recent times, the banking and housing crisis of 2008 was one of the worst in our country’s history, rivaling the struggles of the Great Depression. Banks who had little oversight and tons of power overstretched their limits and caused many people to place too much undeserved trust in their planning and management capabilities. In the wake of their destruction and knowing they needed to rebuild public confidence, banks were under enormous pressure to innovate.
The banking system poured their bailout money and attention into R&D and developed many new ways for consumers to get a refreshing and modern experience with their banks in the form of digital banking. This effort alone has created an entirely new wave of technology now referred to as fintech – an array of software products that all aim to make money smarter and easier to manage. The heavy focus of this in our country, as well as the birth of forward-thinking products such as Clip and Square as well as revolutionary new ideas such as blockchain, has led to a revitalization of innovation in how we as a country treat and approach money in our day-to-day lives.
Hard Times Breed True Innovators: Bill Gates & Microsoft
Economic hardship will always be a prime motivator for innovative minds in our country. Pressure has a way of bringing out the best ideas in people – whether it be the founding of HP during the Great Depression or Bill Gates founding Microsoft during the crash of 1975, tough times breed world-changing ideas.
In the face of difficult and uncertain economic conditions, it is always imperative to try to see things clearly and focus on the benefits and positivity you can share with the world. This is the best way you can add value to any market and is how many of the great companies of our country were able to plant their seeds in the darkest of times and still live to see them blossom. What comes next is still yet to be seen but it will surely be transformative and fun to watch.