Bhaskar Chakravorti has also now jumped on the “this is not the time for gloom and doom” bandwagon. In his recent interview by the Harvard Business School Press people, he cites a bunch of reasons why the old adage “when the going gets tough the tough get going” holds strong, even in this time of unprecedented global recession. He cites the rise of Motorola, HP, Revlon, Southwest Airlines and MTV as a few examples of companies that emerged to offer faster, better and cheaper solutions during times of deep economic strife.

We couldn’t agree more. In a blog back in early February entitled, Angel Advice, we observed that the difficult economic times were forcing a comprehensive rethinking of how organizations make money and serve customers. It concluded that this focus was a healthy, albeit in some cases, a painful process, but one that was lacking over the last several years when most organizations felt by and large invincible. Today, and I say at long last, organizations are asking the right questions … where will innovation solve a problem that will move the needle now…instead of … this is cool, I am sure we’ll figure out how to make money on it someday.

Chakravorti also makes the point that shortage and adversity drives entrepreneurs to dig in and find solutions. There are lots of complementary forces that will help this process. For instance, the availability of technology and corresponding decrease in communications costs makes many new ventures, particularly those that are based on the platform business model, easier to establish than ever before. I am sure we will see a lot of very talented but downsized executives trading adversity for new angles directed at a variety of sectors and sector specific problems - in fact, it hasn’t taken long for many to already step out of the corporation and into the business incubator.

That said, it won’t be easy – this economy is delivering adversity on steroids. Those with the vision, the drive and the determination to see past the dark clouds will find a lot of willing accomplices…venture companies with cash sitting on the sidelines waiting for sound new ideas, angels and advisors with time, money and expertise to help accelerate both the business and business model, and established enterprises looking for innovation outside their 4 walls. We believe that the next few years will be a period of unprecedented innovation; the kind of pragmatic innovation that creates long lasting value based on sound business models and rational business plans. We only wish that some of the trillion dollar bills that the government is throwing about would land in these promising new businesses. But that is another blog post for another day. And in the meantime, check out, Don’t Save The Dinosaurs.