Entrepreneur
Key Takeaways
- Scaling during downturns lowers costs, unlocks talent, and captures market share
- Companies that keep investing while others cut back gain long-term advantages
- Crises shift customers and investors toward bold, efficient and growth-focused businesses
Growth investors invested $425 billion into over 24,000 private companies, and that’s 30% more compared to the year before. But there’s a point: nearly 60% of that amount of money went to a group of 629 companies. While most of the market is panic-cutting budgets and freezing their hiring, a few proactive founders gain the benefit of picking up market share. Scaling in a downturn is simply about taking the opportunities your competitors are too afraid to get. In this article, I will share 5 reasons to scale while competitors are stuck in fear of the crisis.
Customer acquisition cost drops
When the economy gets tight, the first thing most companies do is cut marketing costs. This leaves the door wide open for you. If you keep going while your competitors go quiet, your brand gets noticed way more for a lot less money.
In 2020, Procter & Gamble doubled down on marketing while its competitors cut back due to the COVID-19 pandemic. They kept their brands impossible to miss while their target audiences were stuck home and online. As a result, P&G sales saw a 5% increase over the previous year, even when everyone around had a massive downfall. More recently, Prada Group did the same. Despite a luxury slump in 2024, they refused to cut marketing to protect short-term margins. They saw a 4% sales bump while other fashion houses were sliding.
View lower acquisition costs as a green light to push harder, not an excuse to save. If your ads are bringing in more than they cost, keep scaling them up. Focus on the channels that are working right now and work on smoothing the customer experience.
The rise of talents
There’s been a worldwide reshuffle in tech. In 2025 alone, over 127,000 people were laid off in the US. This shift affected specialists from junior to senior positions. With the tech giants freezing their hiring, it’s the perfect time for smaller companies to find a rare talent.
In 2020, lots of businesses were forced to lay off workers due to the economic downturn caused by the pandemic. That’s exactly when Zoom became active and hired thousands of experts looking for their next big move in a growing company. Their team grew from 2,400 to 6,000 talented employees.
Keep in hand a ‘wish-list’ of the positions that are not burning but you need to reach your next goal. When a competitor announces layoffs, move fast. If you can’t offer a massive corporate salary, win people over with flexibility and a mission that actually matters.
‘Despite’ as an investor magnet
Investors are getting pickier, cutting the number of businesses to put money into, but they are writing much bigger cheques for the companies they actually believe in. Growth is rare in a crisis, so it stands out. Showing that you can scale while others are failing is the best way to get funded.
The AI sector proved this last year, with a handful of leaders (OpenAI, Scale AI, Anthropic, Project Prometheus and xAI) raising $84 billion – that was 20% of all venture funding for 2025. Investors aren’t interested in companies that are playing safe so show off how much faster you’re growing compared to everyone else in your field.
Shift in customer behavior
When times get tough, people tend to look for more convenient or affordable alternatives. A McKinsey survey found that 46% of customers who switched to cheaper brands actually liked the new products better than the expensive ones they used to like before. What’s more, about a third said they weren’t going back.
Temu and Shein used this shift to explode in the US market. Temu’s growth hit 285% in some regions and Shein got ranked as the fourth largest brand in the US, as they were all set and kept waiting for people to look for a better deal. We saw the same thing with food delivery, which jumped from 9% to 21% of the global market in just five years – it all started out of necessity, but people still choose it for convenience.
Make first-time experiences a top priority. First purchase should be so easy and satisfying that the customer has no reason to go back to their old ways. Show them the value (savings, speed, conditions, quality, better service) right from the start, and follow up a few times to make sure that new routine stays locked in.
Fortune favors efficiency
According to McKinsey, messy or outdated processes can swallow up to 30% of your revenue. On the flip side, simply automating repetitive tasks can boost your team’s productivity by the same amount. Scaling when things are tough actually forces you to build a leaner, smarter business from the ground up.
By 2025, 94% of retailers saw their costs drop thanks to AI, with many using it to cut down on excess stock and lower their shipping expenses. These companies aren’t just saving money; they are becoming more agile than their slower competitors.
Focus on fixing your biggest bottlenecks first. Cut out unnecessary manual checks and move repetitive work to simple templates or automated tools. Use your data to make faster decisions, but don’t forget the human element.
Not all successes come in a fruitful atmosphere; sometimes they’re claimed during the quiet or, otherwise, anxious times. By staying quite proactive with marketing, efficiency, talent, and product experience, while others retreat, you are likely to reshape the future of both your company and the market.
Key Takeaways
- Scaling during downturns lowers costs, unlocks talent, and captures market share
- Companies that keep investing while others cut back gain long-term advantages
- Crises shift customers and investors toward bold, efficient and growth-focused businesses
Growth investors invested $425 billion into over 24,000 private companies, and that’s 30% more compared to the year before. But there’s a point: nearly 60% of that amount of money went to a group of 629 companies. While most of the market is panic-cutting budgets and freezing their hiring, a few proactive founders gain the benefit of picking up market share. Scaling in a downturn is simply about taking the opportunities your competitors are too afraid to get. In this article, I will share 5 reasons to scale while competitors are stuck in fear of the crisis.
Customer acquisition cost drops
When the economy gets tight, the first thing most companies do is cut marketing costs. This leaves the door wide open for you. If you keep going while your competitors go quiet, your brand gets noticed way more for a lot less money.
In 2020, Procter & Gamble doubled down on marketing while its competitors cut back due to the COVID-19 pandemic. They kept their brands impossible to miss while their target audiences were stuck home and online. As a result, P&G sales saw a 5% increase over the previous year, even when everyone around had a massive downfall. More recently, Prada Group did the same. Despite a luxury slump in 2024, they refused to cut marketing to protect short-term margins. They saw a 4% sales bump while other fashion houses were sliding.
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