Lessons from Survivors: How Businesses Can Beat a Historic Crisis

Chris Latham

Entrepreneurs struggling through the current global crisis may be searching for guidance on how to survive, if not thrive, in the moment. History offers plenty of lessons.

Past upheavals each had their own triggers and unfolded in unique ways. Yet the companies that succeeded and contributed to society while enduring those downturns also share a few key traits.

They figured out how to attract the right talent, build on the technologies of their era, and adapt their operations to fit rapidly changing circumstances. This meant that daring leaders had to take their firms into uncharted and risky territory with new products and services that anticipated the unspoken needs and desires of a target audience.

“It comes down to the idea of giving entrepreneurs the green light to let their minds run wild,” says Adam Thierer, Senior Research Fellow at the Mercatus Center at George Mason University. “When America has done this, we’ve unleashed more entrepreneurial activities, had a lot more success, and benefited our nation and the globe.”

Thierer is the author of the 2014 book Permissionless Innovation: The Continuing Case for Comprehensive Technological Freedom, and of the 2020 book Evasive Entrepreneurs and the Future of Governance: How Innovation Improves Economies and Governments.

“A big part of the history of the innovation of entrepreneurialism is resistance. A resistance by people or institutions or special interests who like the status quo and don’t like change,” says Thierer, who argues that entrepreneurs who create useful new technologies and products have sometimes been forced to launch them before gatekeepers in the media and government were ready to accept them. “Innovation is almost a form of what some people call heresy.”

These common themes are visible when examining the rise of the airplane manufacturer Boeing during World War I, the entertainment giant Disney amid the Great Depression, the online movie portal Fandango despite the 2000-2002 dotcom bubble bust, and the digital payments service Square in the 2008-2009 financial crisis.


The war of 1914-1918 was without precedent in human history, changing the map of Europe and the Middle East as well as elevating the United States to the status of a global power. Unhealthy trench conditions among soldiers also led to the 1918 to 1919 influenza (commonly known as the Spanish flu), which was the worst pandemic since the bubonic plague of the Middle Ages.

Industrial production in the United States skyrocketed both prior to America’s 1917 entry into the war, as the country supported the Allied Powers with materiel, and during American combat engagement, boosting the domestic economy. But the one-two punch of the flu pandemic, along with the swift slowdown in post-wartime production, hit the U.S. economy hard.

From 1920 to 1921, the U.S. suffered a deflationary recession marked by the sharpest plummet in wholesale prices on record, rampant business closures, and the unemployment rate reaching as high as 11.7%. So how was a young and unproven company able to not only make it through the tumult but go on to remain a household name for over a century?

William E. Boeing transitioned from a successful lumber business to manufacturing airplanes in 1916. A former U.S. Navy engineer, George Conrad Westervelt, and a Chinese-born graduate of the Massachusetts Institute of Technology, Wong Tsu, designed Boeing’s first plane, the B&W. Boeing offered it to the Navy, which rejected his (at the time) unconventional proposal.

After literally going back to the drawing board, Wong Tsu’s new Model C design secured Boeing a 50-plane contract with the Navy. In 1918, the U.S. commercial market then became saturated with inexpensive, unused war planes. Boeing briefly switched to making wooden furniture and boats, as well as making the Model 6 Flying Boat, which it manufactured until 1927.

The company eventually deepened its relationship with the government by producing aircraft for the Army and the Post Office. It also became a serial acquirer of smaller competitors and supply chain manufacturers, while expanding into production for the commercial airline industry and space flight. In 2019, despite one of its worst years ever due to a series of deadly plane crashes and subsequent aircraft groundings, Boeing still had revenues of $76.6 billion.


Massive growth in the U.S. economy during the Roaring Twenties fueled wild stock market speculation from Wall Street titans and Main Street households alike. As production and the job market began to cool, stocks kept rising devoid of business fundamentals. This heady combination ended in the 1929 market crash that signified the onset of the Great Depression.

By 1933, many of America’s banks and the companies they loaned to had failed, 15 million people were jobless, and Dust Bowl droughts in the Midwest and Great Plains destroyed vast swaths of farmland, spawning food shortages. Fixed exchange rates pegged to the gold standard spread the economic turmoil to Europe.

The U.S. government responded with the New Deal, which encompassed everything from huge stimulus measures like the Works Progress Administration for jobseekers to the creation of Social Security. But it was the outbreak of World War II, along with the drafting of able-bodied men away from the private workforce and the full activation of U.S. factory production for military purposes, that finally pulled the United States out of the Depression.

Throughout this period, cartoonist and filmmaker Walt Disney inspired and entertained the American public. His previous venture, Laugh-O-Gram Studio, had gone bankrupt in 1923. Disney released Steamboat Willie, starring the animated character Mickey Mouse, in 1928, through the Disney Brothers Studio (the forerunner to the Walt Disney Company). It was the first cartoon with the new technology of synchronized sound, and a commercial success.

Disney hired the most skilled animators and technicians in Hollywood to make his films, whose stories helped audiences laugh while acknowledging real-world troubles. The shorts Orphan’s Benefit (1934) and Moving Day (1936) referenced the Depression, while 1943’s Der Fuehrer’s Face and Education for Death were wartime propaganda films made for the U.S. government.

But the first full-length cartoon, 1937’s Snow White and the Seven Dwarfs, was Disney’s turning point. Walt Disney had to mortgage his house for financing. His wife and brother tried to stop him from making the film. Many Hollywood insiders dismissed the idea. Engineer William Garity had to invent a new camera to capture the imagery. Snow White was immensely profitable, and Disney has been turning out hits ever since. In 2019, the entertainment company had revenues of $69.6 billion.


In retrospect, the 2000-2002 dotcom bubble and bust pales in comparison to other crises of the past century. That was unclear at the time, with the Y2K bug threatening to wreck computer systems worldwide, the hotly contested U.S. presidential election, the 9/11 terrorist attacks, and the Enron and Worldcom accounting scandals all unfolding in quick succession alongside it.

Between 1995 and 2000, the NASDAQ index of technology stocks increased in value fivefold as fledgling internet-related companies found it easy to acquire funding for initial public offerings. Whereas bold tech firms like Oracle, Cisco, Intel, and Amazon were providing real digital innovations, other firms, like Pets.com, the short-lived online vendor of animal goods, were not.

Mere days after the NASDAQ peaked on March 10, 2000, Japan announced that it had re-entered recession, and Yahoo! and eBay ceased merger talks. AOL and Time Warner, however, went through with their costly and disastrous merger in January 2001. By Oct. 9, 2002, dozens of firms had died out and the NASDAQ had fallen 78% from its peak.

One dotcom that lived is Fandango, the popular online portal for purchasing movie tickets in the U.S. and Latin America. Theater managers, journalists, and investment analysts all derided the concept at first. Co-founded in 1999 by serial entrepreneur J. Michael Cline, Fandango grew a loyal audience by advertising on theater screens and charging a small premium to ticket purchasers.

This approach helped Fandango beat rivals Moviefone and MovieTickets.com. Cline sold the company to telecom conglomerate Comcast in 2007. In 2016, Fandango bought Flixster and its subsidiary Rotten Tomatoes, which together added movie and TV review aggregation as well as a strong social media presence. AT&T owns a minority stake in Fandango due to that deal.

Also in 2016, Fandango acquired M-GO, which provides on-demand streaming of new-release and older shows for movies and TV. In April 2020, Fandango announced it would acquire the online video rental and streaming service Vudu from Walmart. At the start of 2020, Fandango and its subsidiaries had more than 67 million unique visitors per month and was accessible on more than 200 million devices. The acquisitions also diversify Fandango’s revenue streams, offsetting lost ticket sales from theater closures during the ongoing coronavirus pandemic.


In 2008, so-called “too-big-to-fail” financial institutions had become saddled with toxic collateralized debt obligations; the result of too many U.S. homebuyers having taken on mortgages that they could not pay off, while credit rating agencies and government watchdogs ignored the warning signs.

Economic trouble spiraled further out of control in 2009 when Western Europe discovered that some of its less fiscally responsible countries could not pay off their sovereign debt. A protracted tug of war ensued between Germany, Europe’s economic powerhouse, on one side, and Greece, Portugal, Ireland, and Spain on the other, with the European Central Bank caught in the middle.

A wave of government stimulus measures in the U.S., Europe, and Asia ultimately quelled the devastation. These included central banks lowering interest rates to zero or below and unleashing quantitative easing by purchasing debt-related securities, and the U.S. government bailing out large financial institutions and failing automobile companies.

This backdrop did not stop the digital payments upstart Square from launching and catching on in several countries. Square got its start in 2009 when computer programmer and glassblower Jim McKelvey could not complete the sale of some glass faucets because his smartphone couldn’t process the sale.

After speaking with his friend Jack Dorsey, who founded the social media sensation Twitter in 2006, McKelvey and Dorsey brainstormed how to streamline point-of-sale electronic payments. They began as a square-shaped device that plugs into smartphones. The company expanded into software and hardware for small business owners who conduct in-person and online transactions with customers.

Square had seven rounds of private funding while many other businesses of all sizes were collapsing. The company also had to handle state-level regulatory battles in 2013 over its business model before turning attention in 2015 to its IPO. Square had 2019 revenue of $4.7 billion and income of $375 million. With a market capitalization of $38.6 billion as of June 1, 2020, Square was worth more than Dorsey’s first hit, Twitter, which had a market cap of $25.4 billion.


During the fallout from World War I, Boeing grew by hiring ingenious engineers and then shifting production to overcome supply shock and demand challenges. Disney prospered despite the Great Depression by turning cartoons into cutting-edge cinema, thanks to some customized inventions and financial risks. Both companies also understood how to work with the federal government for mutual benefit.

Fandango survived the dotcom bubble and bust by providing simple entertainment services that the masses actually wanted — and by merging with the right rivals when those businesses began to sputter. Square built itself amid the financial crisis of the last decade by filling a large gap in consumer service, while making mobile devices more useful for customers and small businesses. Both firms also figured out how to add value through the internet.

Looking at the current global coronavirus pandemic and U.S. recession, Adam Thierer of Mercatus is optimistic that innovations in technologies as different as bioengineering and automated vehicles will blaze new paths forward on both the health and economic fronts.

“The promise of personalized medicine is that we get closer to cracking serious public health problems by really drilling down on the data and figuring out how to help people,” Thierer says. “That can be done with a combination of machine learning and artificial intelligence, which relies on big-data collection, sensors, and other wearable technologies that we carry with us.”

The building blocks of different industrial and technological revolutions, including traditional communications and transportation technologies, are being combined and recombined in new and interesting ways. “Driverless cars, drones, facial recognition, all sorts of things involve elements of the digital computing revolution but also old sectors,” he points out. Key to success will be regulators at every level of government cooperating with entrepreneurs who seek to improve society.