Things Are Looking Up

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It is a great time to be starting your company. The early stages of any company do not really depend on the economy.  In fact, there are many things that are better for a start-up in a sluggish economy such as this one. Vendors grant more credit, landlords give better deals, and all the services like legal and accounting will often grant deals or work for equity. While banks have been difficult for the last few years, they will need to start making loans to make money.  There is a huge amount of liquidity in the cash market such that banks will have to start making loans to businesses not just in real estate. At the very least very attractive leasing for equipment is now a reality.

The most important driver of growth in the New Year will be the latest tax bill. Among other elements, there was an extension of the provision that qualifying investments in start-ups and small business is capital gains-free for its life.  This means that an investment in a start-up just made a lot more sense for a high net worth investor. Thus, I predict that angel investors will become very active throughout 2011.   The states with similar programs will also help.

THE EFFECTS OF THESE PROGRAMS WILL BE HUGE!

There are many signs that the economy is improving and unemployment will start to fall. It is difficult to keep the economy down when interest rates are effectively zero or slightly negative.  

Except for California, New York, and a few other states financially collapsing (think Greece), 2011 will be a great year of growth. Many very cool companies will be founded. Many more will thrive.  Make one of them your own. 

Veteran entrepreneur Nolan Bushnell is the founder Atari, Chuck E. Cheese, Etak, ByVideo, Axlon, and uWink. Among his accomplishments, Bushnell invented Pong, hired Steve Jobs, and developed a series of robots. He lives in California. @NolanBushnell