Entrepreneurs form their worldviews not from surveys, but from what they see happening around them. For Nate McKelvey, it's been a wild ride since he started Quincy, Massachusetts-based online luxury jet charter company CharterAuction.com in 1999. McKelvey, 35, hit the tail end of the VC boom and bootstrapped the company for most of 2000. At the same time, a now-defunct competitor received $35 million in venture backing. "I was thinking I had a horrible idea at the absolute wrong time," he says.
But 9/11 spurred a flurry of bookings that helped CharterAuction.com close 2001 with sales of $1.2 million. Today, the 25-employee company books luxury jets for highfliers ranging from Wall Street executives and celebrities to political bigwigs including Bill Clinton and Rudolph Giuliani.
McKelvey describes CharterAuction.com as a survivor that's made every penny count. He's encouraged by the company's international business, which has increased from 8 to 15 percent of the company's total business over the past two years. CharterAuction.com projects sales of more than $15 million in 2004 and hopes to maintain 60 percent annual growth in 2005. Even VCs are leaving voice mails, a sign things have come full circle.
Life isn't worry free, however: Rising oil prices and wide fluctuations in the stock market have required CharterAuction.com to adjust its marketing strategy to promote aircraft availability over price. "From my perspective, [the glass] is more than three-quarters full," McKelvey says. "For people who stuck it out, the nuclear winter is over."
Still, entrepreneurs can feel weighed down by all the instability at home and abroad. Melissa Wayne is co-founder of 3 Oh! 5 Creative Inc., a 9-year-old post-production company in North Hollywood, California, that produces movie trailers, TV spots, broadcast marketing pieces and bonus features for DVDs. Business boomed after 9/11 as people sought escape through movie rentals, but Wayne, 53, can't escape reality. She is troubled by issues ranging from the war in Iraq and the soaring national debt to the way other countries view the United States.
"There are so many changes going on. It's going to be a rocky road for quite a while," she says. "My reaction after 9/11 was that the world as we know it is over." Running a small company that can adapt quickly to market changes gives Wayne some confidence about the new millennium, but she's staving off major capital improvements and won't expand her staff of 40 until things seem more stable.
The U.S. economy is back to where it was in the early 1990s when the worst of the recession was over, but we're lacking the innovation and optimism of that time period, says Maria Minniti, associate professor of Economics at Babson College in Babson Park, Massachusetts. She sees 2005 as a crucial year for decisions that will have long-term impact on the economy. Uncertainty "is not a positive thing," she says. "There's a fork in the road."
How good entrepreneurs feel depends on where they're based, says Brenda Nashawaty, 50, principal of CHEN PR Inc., a 20-employee technology PR firm in Waltham, Massachusetts, whose clients include Sun Microsystems and Fairchild Semiconductor. "I think the sense of recovery is about six months ahead on the West Coast," she says. "We've just started to feel things are turning around in the past couple of months."
Nashawaty and three PR colleagues started CHEN PR (an acronym created from the first letters of their last names) in 1996 and rode New England's dotcom wave. When the high-tech sector started to crumble in 2000, though, they stopped replacing employees who left the company, and growth stayed flat until 2003. Nashawaty thinks the downturn of the early 2000s was much worse than the slump of the early 1990s. This time, "it was bigger," she says. "There were more people in the business who lost their jobs, [and] in all businesses, not just ours."
Nashawaty is cautiously optimistic about the future. On one hand, CHEN PR is branching into PR services for biotech and security firms, and it's seen a healthy uptick in company sales, which surpass $1 million per year. On the other hand, she sees businesspeople becoming too cautious. She thinks it will take another year before the economy is healthy. Until then, she believes, it's important to look on the bright side and forge ahead conservatively. "It's corny, but we Americans plow through. We get through bad times," she says. "Everyone [in business] feels like it's going to get better if we just stick to what we're doing."