It’s a Horrible Time for Small Companies. Besides When It’s Not.


A counterintuitive silver lining against the pandemic is developing: While multitudes of small businesses across the United States have been crushed by Covid-19 and its restrictions, others have been urged to take off.

According to the US Census Bureau, there has been an increase in startups this year. As of December 5, the office said, business requests rose 43.3 percent over the same period of 2019. “However, it remains unclear how much the increase can be attributed to entrepreneurs who find the opportunity during the crisis to set up companies that are expected to hire employees as opposed to newly unemployed people who start their own business,” according to Economic Innovation Group, a non-partisan public order organization.

That increase is offset, however, by the fact that by mid-November, about 28.8 percent of small businesses were permanently closed compared to the beginning of the year, based on data tracked by Opportunity Insights, a non-partisan, not-for-profit company Research organization at Harvard University.

In New York City, an estimated one-third of small businesses may never reopen, according to a study by the New York City Nonprofit Partnership.

“The truth is, no one knows what’s next because no one has seen anything like the current intersection of crises,” said Nathalie Molina Niño, author of Leapfrog: The New Revolution for Women Entrepreneurs and CEO of O³, a privately held start-up investment firm.

“Entrepreneurs are naturally deceptively optimistic,” she said. “Because of this, entrepreneurs are still starting and in some cases expanding their business, even if on some days it looks like a mass cemetery for small businesses across the country with their storefronts closed from coast to coast.”

That’s what Eric Levitan has in mind. After 25 years in technology and software companies, Levitan, 49, launched the Atlanta-based Vivo in April, a virtual strength-training fitness program for adults 55 and older, conducted live with a certified instructor. The classes run through Zoom were inspired by having his own parents, who are in their 70s, struggling with aging and mobility issues.

It was a business he’d developed for over a year, but the pandemic threw his original concept – personal strength training classes in senior communities – out the door. “Due to Covid, we changed the model to put the classes online,” he said.

For Mr. Levitan, switching to an online fitness service has significantly increased his potential customer base. “Now there is no geographic limit – we can train someone in Brazil, California, Japan and have coaches anywhere in the world.”

Currently, Vivo, which he is building with his own resources – to this day almost 100,000 US dollars – is still in the early stages with 50 members aged 52 to 85 years. Customers take 45-minute courses twice a week. However, according to Levitan, the capacity with nine trainers is closer to 1,000 customers.

“It’s hard to build relationships over video the way you could in person,” said Alisa Cohn, a New York City-based global executive focused on startups. “But when you have the right idea that the market needs, it’s always a good time to start a business.”

Another surge in the pandemic: houseplants. In August, Alexi and Brendan founded Coffey Steward, a New York City-based virtual company to help people become successful crop growers.

“We’ve been working for the last two years developing the technology for the app, building a team, testing it, and the launch was scheduled for early spring,” said Coffey, 31. Before the pandemic, the couple had raised 500,000 Early-stage US dollars from angel investors.

“We were blind, postponed the start and rethought our plan,” said Ms. Coffey, 29. The Coffeys had developed a digital consumer subscription that was combined with a business service to provide horticultural advice to brick and mortar offices and restaurants.

“With our app, customers scan rooms in their homes with the camera on their phone. The app creates a map that shows differences in light distribution and suggests the best plants for the room and their care, ”said Ms. Coffey. Some clients have even asked for help creating video-worthy plant wall backgrounds for their home offices.

The company now has around 5,000 customers worldwide. “We have benefited from the fact that people are at home and more interested than ever to grow,” said Ms. Coffey. “Moments of planting and watering the plants destroy the strange digital reality in which we live. We will have a little joy in people’s lives.”

Pickles also have the power to produce happiness. In September, Mark Mammone, 39, a sous-chef, and Joe Bardakos, 30, a chef founded Bridge City Brinery in Pittsburgh.

Five years ago, Mr. Mammone started making cucumbers as a hobby. His inspiration was the sauerkraut of his grandmother, an immigrant from Croatia. The secret: The cucumbers are fermented in a homemade salt solution.

“I let my friends try them out and they said, ‘You have to do something with it. You have to sell them, ”said Mr. Mammone. “Once that idea came up, I thought, okay, I’ll start a cucumber company.”

But it was a Backburner idea. “The pandemic actually got business going again,” he said. Mr. Bardakos offered to help and a partnership was born. “This is something we can do now and be in control,” said Mammone, “and it won’t cost us a lot of money.”

“Managing the uncertainty during this pandemic and the associated political and economic landscape is the greatest challenge facing any entrepreneur,” said Sanyin Siang, executive director of Fuqua / Coach K Leadership and Ethics Center at Duke University and author of The Launch Book : Motivational “stories to start your idea, business or next career. “

“The motivator is a deep belief in the idea,” said Ms. Siang. “It is this belief that also creates the convincing factor for customers, employees and investors.” And that is exactly what the cucumber suppliers did. They self-financed their business with less than $ 3,000 and sought help from their family, friends, and their boss, who allowed the two to work in the restaurant’s kitchen.

The real challenge was finding supplies, which pushed the launch back a few weeks. “Glasses were in short supply – it seems everyone was busy drinking food during the pandemic,” Mammone said.

Leveraging sectors with a downturn can be a counterintuitive but successful approach. While other restaurants were closing, Suhail Karimi, 35, in Los Gatos, California knew it was his time to pursue his dream.

“There was a bit of a fire sale,” he said. As a result, he licensed liquor and other components of a restaurant business from a tenant who was on-site at about half the original pre-pandemic price. He was also able to negotiate a cheaper lease with the landlord. And so, three months ago, he opened his first restaurant, Eleven College Ave.

“It was a little fight, but we survive,” he said. “I knew what I was getting into and that there would be some challenges in complying with the ever-changing security guidelines.”

The biggest challenge: “We have such a small capacity – 40 guests at the same time,” he said. “The dining room has a full capacity of 140.”

Its start-up costs – around $ 500,000 – were funded by the family. “It was definitely a very calculated risk,” he said. “It took a lot of discussion and moving parts to make this happen.”

Christina Hale didn’t think about it. She started making hair bows for her daughter eight years ago, who was then 7 years old. It wasn’t long before she was selling her creations at craft festivals and adding jewelry, wooden signs, wreaths and more to her repertoire.

But Ms. Hale, 47, hadn’t considered opening her own retail business until the coronavirus canceled the family summer vacation in Myrtle Beach, SC and her college-age son moved home full time when his dorm was closed.

“That’s when I saw the ‘for rent’ sign,” said Ms. Hale. “It was the sign for me. I now have three children at home and there wasn’t room for all of my inventory – about 4,200 sheets alone. “

She traded that $ 4,000 vacation fund for the storefront that came with a rock bottom rent. And in October, Ms. Hale welcomed her first customers to Bows 4 U & Gifts 2, an 800 square foot retail store in Culpeper, Va.

The development of a customer base has been slow, but is growing. (Ms. Hale hopes to open an online store for her company as well.) “Some people will stop and look in the window but won’t want to go in,” she said. “I leave my door open to the fresh air and when you walk in you get dizzy. It’s such a place. “