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Published: Monday, 5/4/2009

Tired of seeking work, some create their own

NEW YORK TIMES

SAN FRANCISCO - Alex Andon, 24, holder of a biology degree from Duke University, was laid off from a biotech company last May. For months he sought new work. Then, frustrated with the hunt, he turned to jellyfish.

In an apartment he shares here with six roommates, Mr. Andon started a business in September building jellyfish aquariums, capitalizing on new technology that helps the fragile creatures survive in captivity. He has sold three tanks, one for $25,000 to a restaurant, and is starting a Web site to sell desktop versions for $350.

"I keep getting stung," he said. And his crowded home office is filled with beakers and test tubes of jellyfish food. "But it beats looking for work. I hate looking for work."

Other laid-off workers across the country, burned out by a merciless job market, are building business plans instead of sending out resumes. For these people, recession has become the mother of invention.

Even in prosperous times, entrepreneurs have a daunting failure rate. But those who succeed could play a big role in turning the economy around.

In 2008, 3.8 million companies had fewer than 10 employees and they employed 12.4 million people, or roughly 11 percent of the private-sector work force, according to the Bureau of Labor Statistics.

Economists say this wave of downturn start-ups has some peculiarities. Chiefly, the Internet has provided an extraordinary tool, not just for marketing ideas but also for finding business partners and suppliers as well as doing all kinds of functions on the cheap: keeping the books, interacting with customers, even turning a small idea into a big idea.

Jerome Engel, director for the center for entrepreneurship at the Berkeley Haas School of Business, said the goal for many entrepreneurs is not to create a company that someday will make billions but to come up with an idea that will produce revenue quickly.

"It's a very painful thing," he said of the pressure to find new ways to make money. "But it's a healthy thing."

He noted that the dot-com bust helped propel a pack of hardy companies, one of which was Google Inc. Mr. Engle said it succeeded during the bust in part because it was highly focused and did not need much capital.

Mr. Andon, for one, seems to have found his niche. He said he recently received an order for a large jellyfish tank that should sell for tens of thousands of dollars.

At least four of his roommates are starting companies. Two - Erin Kitchell, 28, and her brother, Andrew, 25 - are making laminated, fold-out language guides for travelers.

"This is as good a time as any to try something entrepreneurial," said Ms. Kitchell, who took a voluntary buyout in June from Wachovia.

"There is not a lot of opportunity right now in finance."



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