Telecom and Military
Ask HN: What tech companies/industries will do well in a recession?
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Re: Ask HN: What tech companies/industries will do well in a recession?
#72None. Tech is highly cyclical. Maybe some are closer to government spending which maybe will rise in a recession but they will all be hurt.
During the 2007-2009 recession, I worked for a software development company that provided custom software development services to local and state governments. My understanding was that their sales rose during the recession because replacing government agency staff with our software was a cost saving measure.
Re: Ask HN: What tech companies/industries will do well in a recession?
#73Earlier quoted context omitted.
> Companies that cater mostly to luxury clients Nah - look at what happened to the Boating industry in 2009. The values of jetskis, sailboats, etc took a major hit as demand dried up. Boats are considered luxury items
I would think the important distinction would be luxury products that cater to the extremely wealthy (as opposed to luxury products bought by people that can barely afford it).
What kind of luxury products cater to only (or even primarily) the extremely wealthy? Superyachts, airplanes, maybe some exclusive villas/hotels, what else? Even supercars are bought by the merely "very" wealthy, who may be affected.
Re: Ask HN: What tech companies/industries will do well in a recession?
#74The defense sector, but you'll eat lower payments until a recession
Re: Ask HN: What tech companies/industries will do well in a recession?
#75Earlier quoted context omitted.
I would think the important distinction would be luxury products that cater to the extremely wealthy (as opposed to luxury products bought by people that can barely afford it).
What kind of luxury products cater to only (or even primarily) the extremely wealthy? Superyachts, airplanes, maybe some exclusive villas/hotels, what else? Even supercars are bought by the merely "very" wealthy, who may be affected.
For a watch analogy, consider Tissot vs Omega. The former is considered an "entry-level luxury" brand with many offerings around the $1000 mark, while the latter is a true luxury brand with most offerings in the range of tens of thousands of dollars. Pretty much any broke person can get a Tissot to appear well-off, if they want it hard enough.
For a car analogy, consider BMW vs Aston Martin. Many people in an unfavourable financial sitation can get a well-specced 3-series and appear well-off, while a $200k DB11 is well out of reach for most "pretenders".
Re: Ask HN: What tech companies/industries will do well in a recession?
#76Video streaming
Re: Ask HN: What tech companies/industries will do well in a recession?
#77Related question: which tech products are 'inferior goods' - goods whose demand rises when incomes fall https://en.wikipedia.org/wiki/Inferior_good
Non-car modes of powered transit - small petro scooters, e-bikes, etc.
People always need to get around in a non sweaty way but a car is both a lead weight financially and a potential windfall when car prices are artificially high.
Re: Ask HN: What tech companies/industries will do well in a recession?
#78Platforms like airBnb/Uber. The house always wins.
Except there is no house during a recession. People don't travel nor look for vacation rentals to stay in.
Re: Ask HN: What tech companies/industries will do well in a recession?
#79There is no exact answer to this question, just a set of factors that contribute towards doing better than someone else. First, do you directly make money for a company, or directly reduce costs? The closer you are to core activities that generate income, or increase efficiency, then the more protected you will be from being laid off. This applies to companies too in a way. Companies need core services like email or…
+1 for being close to the money. Prefer the revenue side over efficiency if possible.
Re: Ask HN: What tech companies/industries will do well in a recession?
#80I suppose we could also frame the question as which tech companies and industries will NOT do well during the recession.
I think that streaming services will not do well. People will return to torrenting and piracy. Same with crypto trading platforms. Basically any place where Joe Average can't afford to spend more than he has on hand. Tesla will see a big drop too, as people will cash out to buy their groceries.
As for what will: free for the end user services that get by on ad revenue and data mining. Alphabet, Facebook, stuff like that.