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Top 7 Reasons Why This Recession Is a Great Time to Start a Green Business

Scott Cooney | Thursday March 26th, 2009 | 7 Comments

newgreenbusinessShiraGolding.jpgWhile counterintuitive, a recession is actually a terrific time to start a business. Sure, credit is tight, and venture capital is definitely hard to come by, so startup ideas requiring large amounts of up-front capital are perhaps best left to the drawing board for the moment. But for many entrepreneurs with a dream, startup capital requirements are small, and other elements of the economic outlook are very favorable.

As far as timing, for most businesses, it simply takes time for their product, service, or brand to become recognized, trusted, and sought after. Estimates vary widely, but it is simply a truth that average customers have to see your product or company several times before they make a purchase. This makes a recession a great time to get your name out there while most other companies are cutting back and the competition for people’s attention is less. Your company will be in good shape when the economy rebounds.
So while recessions can be a good time, and historically have been a good time for businesses to get their start, this particular recession is a great time to start a green business. Here’s why:


1. The green economy is finally gaining widespread traction. While interviewing Warren Lloyd, a green architect based in Salt Lake City, I was struck by his assertion about the timing of the recession. “Things will be very different [when the residential construction industry starts to heat up again],” says Lloyd. “Building green will just be the way things are done.” Truthfully, the perfect storm of high heating and cooling costs, widespread recognition of health benefits in green buildings, decreasing costs of low and no VOC paints and other green building products, and the leadership of the US Green Building Council’s LEED standards where the industry has a generally accepted set of guidelines to follow has created an environment in which green will become standard in the very near future. While this may be sooner for green building than for other green industries, such as biofuels, the overall logic applies to just about every part of the green economy.
2. The green labor situation favors the eco-entrepreneur. The popularity of Bright Green Talent, Green Career Central, Net Impact, and other green career resources testifies to the fact that many job seekers are seeking more than just a job, but a job they can feel good about. With a lot of folks out of work, you could likely hire some terrific and highly committed talent for less than what they could probably demand from traditional companies and in better economic times.
3. It’s a great time to lay the foundations of a business culture that spends wisely. Having a business culture that values thrift and wise use of money will go a long way toward ensuring future success and profitability. It is much easier to create that culture at the beginning of a business rather than changing gears after several years of lavish expenditures. Thrift and wise use of money have long been accepted norms of green consumerism, and will weave themselves throughout your business as you go and stay green.
4. The government has got your back. With nationwide training programs in green jobs a likely result of Van Jones’ nomination as ‘green jobs czar’, you’ll be able to pick up some skilled workers (see #2 above). In addition, tax credits and incentives for energy efficiency and other green incentives are being pushed from Washington all the way down to local municipalities.
5. It’s no longer weird to be a green entrepreneur working out of your garage. Let’s be honest, social considerations are as important as any when it comes to starting a business. When meeting new people, frequently the first question you get is ‘What do you do?’ Six years ago, when I was running an eco-friendly landscaping firm out of my garage, this was two strikes against me. Not only was I running a low budget business out of my garage, but it was weird because it was different. How could a girl tell her dad she was dating a guy who was running some strange eco-experiment in his garage? Telling that story now would yield very different results as people have started to acknowledge that there are better ways of doing things.
6. There are tremendous resources available to get going green. I wrote my book, Build a Green Small Business, for exactly that purpose, and have had great satisfaction from meeting several green startups who’ve gotten their start from ideas in my book. In addition, there’s Ecopreneuring by John Ivanko, 75 Green Businesses by Glenn Croston, and a great variety of websites that tailor to starting green businesses, such as Ecopreneurist, the Ecopreneur’s Guide, and of course, Triple Pundit.
7. Having a niche is as important as ever, and nowadays, green is one sexy niche.
Scott Cooney is the author of Build a Green Small Business: Profitable Ways to Become an Ecopreneur (McGraw-Hill), and hopes that someday the green economy will simply be referred to as…the economy.
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  • http://www.padosa.com Shilpa Amladi

    Nice article. I like point 3. The green cultural foundation is very important for building the green industry further.
    I think even the government backing is very crucial for any industry to flourish. And seems like the government will become a financial supporter, especially now that the economic stimulus package for green technology is so promising.

  • Dale S

    Fantastic summary. This is the kind of thing I love to pass around. I’m also fond of $5 – the way we do business is different now, less formal, and that’s a good thing! I’d skip #7 – this won’t be a niche for much longer. This is common sense!

  • http://renewableenergyuk.blogspot.com Matthew Green

    This is a really interesting piece and I think highlights the fact that green industries, including renewable enrgy are some of the better industries to be in. As you quite widely point out, now is a good time to hire because of the widescale job losses in other companies, and in the UK renewable energy companies are some of the few who are still hiring staff, whereas many just fire staff instead.

  • http://hyperlocavore.com Liz M owner hyperlocavore

    The people best positioned are those folks that understand that green and frugal go together like peanut butter and jelly. Unfortunately the last two years have been about promoting conspicuous not at all ‘green’ consumption that has been marketed as ‘green’ – 14 dollars for three one time use silk tea bags comes to mind.
    Being green can save you lots of green and that’s why real green businesses will do fine in the next 5 years. If you are actually green you will know how to sell your value proposition as the wise and thrifty thing to do in these times.

  • http://www.sustainablebrands09.com KoAnn

    If you’ve got a new green business looking for exposure, partners or $, submit today to the Sustainable Brands new venture exchange here: http://www.sustainablelifemedia.com/events/sb09/newventures!

  • http://www.buytradebiz.com/ Fitzgerald

    good informative article…. starting any small business during a recession is a baptism by fire, but if we can survive, we will thrive as the economy recovers.

    thanks for sharing this information.

  • http://www.buytradebiz.com/ Fitzgerald

    good informative article…. starting any small business during a recession is a baptism by fire, but if we can survive, we will thrive as the economy recovers.

    thanks for sharing this information.