Starting a Business

What It Was Like to Launch a Startup in Post-Recession Cyprus

It was sheer anxiety provoking, it was very brave and bizarrely, in a post-recession economy on an island, it actually seemed like the only thing left to do.
What It Was Like to Launch a Startup in Post-Recession Cyprus
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Guest Writer
Founder of HR Innovate
5 min read
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Even in non-recession times, taking that leap from steady, paid employment to self-employment is panic station central and a recipe for many a sleepless night. It's like jumping off a hurtling train and hoping you won't get hurt. At first it stings like nothing else and as the bills roll in and you are chasing your invoices, your stomach contorts with each sum that doesn't add up. It's sheer anxiety provoking, it's very brave and bizarrely, in a post-recession economy on an island, it actually seems like the only thing left to do apart from leaving and venturing to new pastures for employment.

Related: With Tech Companies Booming in Cyprus, We Need to Continue to Attract Qualified Candidates

The beautiful thing about a recession, if such a thing can be said, is that suddenly all bets are off. People get creative, and as desperation grows so, too, does everyone's sudden appetite and need to experiment and grow. Because what else can you do? There are no more steady, paid jobs. For starters, everyone is back to saving their money in shoeboxes under their beds because who wants to risk another bank collapse?

In post-recession Cyprus, following the collapse of the main bank, we returned to earlier, more primitive times when barter exchanges took the place of cash payments.

My accountant became a friend who needed hot desk space. My office space came in exchange for a recruitment project. Across the island, people banded together to work out mutually beneficial barter agreements for goods or services and startups sprung up everywhere. This was the environment into which HR Innovate was born in 2016. It was hustle or be hustled, sink or swim. In a time when everything seemed to be sinking, it was the time to strike out alone and carve out a niche.

In such times, it becomes very apparent who the survivors will be -- those who stayed standing and diversified their business streams enough and those who didn't and whose office spaces now carry "For Rent" signs.

Related: Entrepreneurship in the Western Balkans: The Next Frontier?

In many ways, it might sound like starting your own recruitment business in a collapsed economy where unemployment was rising and businesses closing down was suicidal, but in crucial ways it was this energy that drove me forwards. I kept thinking that once you reach rock bottom the only way is indeed up. Many salaries of people I knew across the island had been slashed by as much as 50 percent; the impetus to work for myself also came from the realization that to work for anyone else still meant risking not being able to pay the bills. Why not take a risk on me?

In the haze of the post-recession, to form a startup and attempt a profitable business, you have to abandon all textbook business ideas of protocol and procedure, any parameters in fact that made sense before. You have to be extremely diligent in your debt collection with the forewarning that strict payment terms may not be possible since cash flow is an issue for literally everyone.

Operating in a society which is very patriarchal and most business owners and decision-makers are male also presents confounding issues as a female entrepreneur. The EU released a report for 2016 stating that for startups in Cyprus that year, a whopping 81 percent of founders were male while only 19 percent of founders were female. Female entrepreneurs are still a novelty in the Mediterranean and Middle East, and I was met routinely with some amusement and more than a little skepticism.

Related: What I Learned by Starting My Business on the Isle of Man

I knew and stubbornly clung to the belief that to knuckle down for the next couple of years or so while conditions stabilized and attempt to connect in the community with candidates and clients was the only way to weather the storm. In this way, I could establish the brand, our name and business ethic as a local force to be reckoned with, female-led and all.

As the clouds cleared and unemployment rates dropped steadily in the last three years from over 16 percent in 2015 to less than 8 percent this year, we have now gone from a candidate heavy recruitment sector to a client-heavy sector. Businesses have begun to release the purse strings as our economy has grown stronger and recruitment and training budgets have recovered. As we stood firm in our approach and branding, our source of new local business is mostly referral based and we routinely are asked for our advice by both candidates and clients.

People can be bound together by struggle, and the startup community can be very supportive and inspiring; the trick is to retain focus and drive and not give up. Almost three years in, we have made it through the worst of it. I am not met with amusement anymore but some regard, I hope, from my peers, and we are looking forward to positive market indications that Cyprus is on the upswing.

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