My first recession

There’s an entire generation going through a recession for the first time.

Sure, everyone says we need to adapt, and while true, I think the phenomenon in itself – going through a recession for the first time – is a key paradigm shift for all of us first-timers. I’ll try capturing some of it here through my personal experience.

I was a one-year-old when the Dotcom bubble burst, and I was 9 when the Great Recession started. To be honest, I don’t remember much about those times. I was just a kid wanting the latest Hot Wheels of that time, happily enjoying my innocence and being sad when my parents couldn’t afford it. But I do remember the stories. I remember my parents struggling, mad about some bankers that suddenly disappeared with everyone’s money, and others losing everything. A decade later, I moved to San Francisco, a city known for its creative, ambitious people. It shaped almost everything about me, especially my perspective on startups.

What I didn’t know was that 2018-2022 San Francisco was pretty unprecedented, a time of infinite abundance. And being early in my career, I wasn’t thinking about why there was such abundance; I just focused on trying to run faster, leveraging what I could. Maybe I’d read here and there that zero interest rates lead to assets like technology being overvalued. But no one seemed to care, so why would I?

I kept running, increasingly used to playing a game that knew nothing about scarcity. The funny thing is that (almost) everyone gets used to whatever rules of their time. It’s the logical thing to do to leverage market opportunities. The difference, however, is that while I was running the same race, I had no perspective on how it could change. Emotionally, I had no idea what was ahead.

Start March 2022, and the Fed increases rates for the first time since 2018. It was the first time I had read news about anything like this. I studied how recessions work, but I had never seen it happen live. Seeing it play out felt different. I knew what people were talking about but didn’t yet understand it. Before I knew it, the rules had changed. Seemingly out of nowhere, everyone started playing a new kind of game.

The transition was intense. It had taken me years to adjust to San Francisco. The pace of the city and the drive of my peers were inspiring but also daunting. I trained myself to survive first and how to ‘win’ second; by the time I thought I was getting pretty good at it, the world shifted.

People started saying the bubble was starting to burst, and for a while, everything felt motionless. So many of us were lost in trying to figure out how to move forward; we were on this race, were we now supposed to change speeds? And in what direction? Uncertainty was at its highest.

I was trying to make sense of a world that was changing in unknown directions. The only thing I knew was that this new world’s driving forces seemed to be different from those before. So, it was pretty clear I had to adapt, but I was trying to figure out how. The 12 months that followed were very uncomfortable. It was a process of self-inspection, trying to figure out all the wrong knowledge that led me to where I was today but which I knew was outdated for years ahead.

For better or worse, our attention through the last few years was fixated on all the things that come out of abundance. Our role models were starting to feel off. A lack of substance and hard work seemed to have infected our culture, and now that the economy was beginning to deteriorate loudly, all these things were becoming apparent.

Very quickly, the spotlight started to change. People that had been in the trenches for decades, that knew what a recession felt like, were now having a louder voice, trying to warn all of us that were about to face the same fate.

This shift in attention was starting to feel inspiring. Online voices play a massive role in how the newer generations turn out; we might be smart, incredibly driven, and more courageous, but our biggest weakness is that we lack perspective. It’s hard to recognize how I should evolve if the spotlight never sheds light in new directions. Now it has.

The spotlight was on the wrong people, the loud people, full of noise people. We grew to believe that scammers were the talent we had to learn from. Now we were starting to see some of those stories play out, and the playing field was starting to become more honest. This was an important reminder. There’s nothing worse than thinking that hard work and consistency don’t matter. That there are easier, faster ways to succeed under capitalism.

I think 2022 will be remembered as the year that made us wiser. It forced me to evaluate everything I thought I knew, adapting to a new environment that seemed so hostile at first but now I’m starting to understand. I won’t lie, though; sometimes, I am deeply scared. Again, I grew up with stories of people losing everything. What if I’m one of those? I can only hope I won’t.

There are certainly tough times ahead, but they are also exciting. There’s something beautiful in being recession first-timers; times like this force you to understand the kind of person you want to be, to grow up. Now we get to decide if we keep the same pace, slow down, or increase it, diving deeper.

Gadi Borovich