Laid-off employees launch startups

If Seattle’s tech sector was borne of the deep recession in the 1970s when engineers laid off by Boeing started their own companies, will the sharp increase in unemployment among our region’s talented workers today create a fertile new spawning ground for innovation?

Consider. When Alex Hillinger lost his marketing job at Suncadia Resorts last summer, he took off on a long road trip the following day, recording his travels in pictures that he shared online with friends and relatives. In this compelling desire among people to connect, he concluded, was the germ of a business idea. Even as advertising budgets shrink, Hillinger thinks his new company, Good Chemistry, can help companies engage with people of influence through the rapidly expanding landscape of social media networks.

When Andres Krogh, 25, lost his job at a security startup last summer, he worked on projects, taught himself new programming skills and developed an iPhone game. Sitting still, he says, “drives me nuts—to a disabling degree.” In December, he and a friend came up with the idea of a Santa’s secret helper website that would use an automated dialing service to ask kids what they wanted for Christmas and deliver the information to interested relatives. The idea, which went from concept to launch in five days, was a modest success and has since morphed into Flaunt, a company that provides gift ideas for all sorts of occasions. Krogh has had trouble raising money, but he doesn’t mind. “It keeps me hyper-focused. I’m not going to blow my money on some fancy business cards.”

Michael Kim, who left Microsoft when his position at the company was eliminated, could have found another job in the Bay Area. He chose to stay because his wife had a good career and his family liked the Bellevue community where they lived. Instead, he started Grapevyn, launched this spring, which builds on existing social networks to help trusted friends find referrals on important issues like who to use for a doctor, a mechanic or a baby sitter.

Nathan Casey co-founded Jobvana, a social networking site for job seekers, with two colleagues after the three of them lost their positions at Washington Mutual last year. He told TechFlash that WaMu’s collapse provided the “spark” he needed to pursue his long delayed dream of launching a startup.

So, are we experiencing a surge in startups? Marcello Calbucci, publisher of Seattle 2.0, says that from early March to early April, he added a record 19 startups to his “startup index,” far more than the typical five to six additions in previous months. He thinks most of those startups were spawned before the current downturn began. Even so, Calbucci believes the downturn may have intensified startup activity. Where there might have been one networking opportunity for startups every month, today there are five or six. And with so many people facing career changes, he says, the networking sessions are packed with people.

“If it takes a recession to make people realize they are entrepreneurs,” says Kim of Grapevyn, “maybe that is a good thing.”   

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