Small business owners give their take on tough times

Three years and counting of a struggling economy and no improvement in sight has to make people hesitate about starting a new business, doesn’t it?

Not surprisingly, there has been a steady decline in business starts over the past three years.

But over the long term, “will the damage d

one to small business by the weak economy have a long-lasting effect, discouraging the next generation of entrepreneurs?”

This provocative question was posed in a column last month in The Wall Street Journal.

We decided to ask a few local small business owners their thoughts on this qu

estion.

Here they are, in their own words:

John Bell, owner of Willis Hall Winery in Marysville:

One of the predominant characteristics of entrepreneurs is optimism. Without it, they would not dare leap headlong into the unknown. Yes, optimism needs to be tempered by a good business plan, but without optimism, nothing happens.

Thus, I feel that new entrepreneurs will be less affected by the weak economy than one might think. They might be more circumspect in starting a business, but I feel that they will, nonetheless.

You may hear a different answer from a recently started entrepreneurial business, however. The entrepreneurs who started these businesses had no clue about the advent of the recession, and their business plans almost certainly did not accommodate such an eventuality. Many of these businesses are struggling, and many will not survive. I feel that the initial optimism that drove these entrepreneurs most likely has been thoroughly tempered, or even destroyed, by economic doldrums. Some will rebound to try again (there’s that optimism again), but many will not. Whatever happens, the small-business climate will be severely damaged for a long time, maybe decades, before it rebounds robustly.

Tom Lane, CEO of Dwayne Lane Motors of Everett:

I would guess that the weak economy will not have a long-lasting effect on the next generation of entrepreneurs.

In fact, other than the challenge in access to capital, I would think it would have the opposite effect. It seems that the entrepreneurial spirit is a trait more innate than developed. They are the type of people who can’t be told that it can’t be done. I would also guess that this type of person thrives in the uncertainty of instability and grasps newly created opportunities, because it usually takes creative thinkers like them to design the “new way to solve an old problem.”

I also have confidence in people to bounce back from adversity. Kind of like the “toughest steel is forged with the hottest fire” analogy. The increased adversity faced by the X and Y generations will have a lasting impact that, similar to the Great Depression generation, will instill a desire to never return to that time.

Tom Hoban, CEO of Coast Real Estate in Everett:

Three years ago, when the commercial real estate market began its historic spiral, our company faced a crisis. Commercial real estate transaction volume was projected to drop by 60 percent. Survival was all that was on any commercial Realtor’s mind at that point. We challenged ourselves, though, the way entrepreneurs often do: What if instead of just surviving, we could figure out how to thrive? Maybe even grow?

We met with our key staff in a retreat setting and began throwing ideas around the room. Nothing and no one was sacred. Everything was on the table. What surprised us was how many of the best and most entrepreneurial ideas came from the younger ranks in our firm. Labeled as needy by Baby Boomers, our millennials proved to be superior to their older counterparts in how to adapt and think creatively. They knew how to leverage technology and were surprisingly practical when it came to implementation.

Once we had a plan, it was we older types who had to organize it and manage it. They required a bit more attention and were easily distracted at times, but our millennials are a big reason why we not only survived but we grew in most difficult commercial real estate market since World War II. I think younger Americans are going to blow away their Baby Boomer parents’ generation and be fantastic entrepreneurs.

Phil Bannan, co-owner of Scuttlebutt Brewery Co. in Everett:

I don’t think the long recession will have much of a negative impact on the next generation of entrepreneurs because nothing seems to constrain the true entrepreneur. It’s in their DNA. Yet, there are a lot of steps between the germination of an idea and a fully functioning enterprise. Somewhere in there, financing and capital accumulation become a key determinant of successfully bringing an enterprise to life. I think the question is: Will there be financing? Venture capital is difficult, IPOs aren’t working and the tax policy is confiscatory. That’s where I see the future entrepreneur’s problem.

What do you think about the future of entrepreneurship? Please send your comments to entrepreneurship@everettcc.edu.

Pat Sisneros is the vice president of college services at Everett Community College. Juergen Kneifel is a senior associate faculty in the EvCC Business program.