A MATTER OF PERSPECTIVE: 7/26/13

The Recession Advantage

Low cash, low risk.
Founding a business can be a risky decision, particularly during a recession. AIE had been a side business for Ben until 2009, when Ben and Jeremy partnered to take the company full-time.

Benjamin Wills

I went full-time with AIE because quite honestly, I was tired of working for “the man.” After the third unemployment situation in a single decade, I decided to go where my quirky personality would be accepted – my own business. At least my brother knew what he was getting into when accepting to partner with me to form what AIE is today.

Two good things helped our start-up situation. 

First, because I had no money in the first place, eating dirt for the first few years of growing the business was familiar to me already, and not very scary to the family.

Second, Jeremy and I agreed to keep the company out of debt and go it on cash alone

Running a business essentially debt-free forces good behavior.  

One behavior is being very conscious of the return on investment when spending your own (scarce) cash. This leads to being constantly hungry to improve the returns of the business.

Other people’s money (OPM) and loans distort a business owner’s judgment. Taking risks becomes less personal to the business owner and therefore, more risky. This consequential behavior has been easily observed over the last couple decades with the all the bubble market chasing and resulting collapses.

In the midst of a recession, being free of that debt is critical for survival.

We have always felt that the market may go south hard, but we as a partnership will not have many of the pressures other firms will operate under because of their spending behavior.

It's clear to us that our debt-free beginning has placed us in a very advantageous pricing and survival situation.

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Jeremy Wills

I have entrepreneurship in my DNA.  

I’ve learned this over time and through various experiences. Reflecting on my career path and where I’ve found myself volunteering my time, I have tended towards start-ups in nearly every decision. Something intrinsic in me revels in making meaningful decisions that have high impact results across multiple people and processes—all from scratch.

Funny what one week can do to a life.

Within one week in early 2009, my wife had given birth to our second child, we sold our home and I unexpectedly lost my job.

Not long after, I was suggesting to my wife that Ben and I would go full time with AIE.

It was a surprisingly easy decision for me personally. And she supported me! Although the cumulative effect of these life changes brought higher levels of stress, there was a resounding peace that this was the right decision

Starting the business in a recession gave me more confidence, not less. 

I had confidence that the poor economic climate was going to be to our advantage. Companies were being forced to realign budgets, and often found themselves searching for new suppliers as a result. Additionally, we were going to be able to hire more-qualified people at more affordable rates. As a matter of fact, everything was going to be less expensive—labor, equipment, real estate, etc. 

It was a concern for me that we had no capital in the company as we began.

This worked to our advantage in some respects, as little cash meant little mistakes. Big cash would have meant the potential for big mistakes. This allowed us to mature in each area of the company at a healthy pace.

The biggest hesitation I had in making the decision was my lack of industry experience, having been out of the technology field for a number of years. The entrepreneur within won out, however, and I'm very glad it did.

In the end, that burning entrepreneurial thirst would never be quenched if I did not step out of the boat.

And with that, we strapped on our suits, knocked on some doors, and…voila!