How does a recession influence a start-up?

Disclaimer: I'm not a financial expert.



Explanation of graph: The higher the point where the supply curve (entrepreneurs) meets the demand curve (consumers, investors, and acquirers) the better it is for start-ups.

Conclusion: Everything in a recession shows that the equilibrium point is going to move down.

Examples: Fewer jobs equals more people willing to do a start-up. (supply curve shifts right)

Lower salaries for existing jobs equals more people willing to do a start-up. (supply curve shifts right)

Consumers spend less equals less demand for start-up products. (demand curve shifts left)

Less income for Investors decreases the amount of venture capital available. (demand curve shifts left)

Lower profits for big business equals fewer acquisitions and lower acquisition prices. (supply curve shifts right)

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