Whether firms founded during or outside economic crises have greater growth potential is an important question for both prospective entrepreneurs and policy makers. Existing research offers conflicting answers, and mostly either focuses on aggregate cohort-level effects or selectively excludes small new firms from the analyses. Using extensive linked employer-employee data on young German firms around and during the Global Financial Crisis, a period of sharply reduced access to external capital and recession, we show that young firms respond to cyclical conditions in highly heterogeneous ways. Our firm-level results reveal that the average new firm found it easier to hire its first employees when it was founded during the crisis. These firms achieved countercyclical growth by hiring career entrants. More specifically, hiring in very young (<1.5 years) and small to medium-sized (below the 90th percentile) young firms was countercyclical, while this was not the case for older and larger young firms. Thus, the firm-specific effects for young entrepreneurial firms may be very different from those reported in previous research. Our results suggest that market entry during a crisis may facilitate hiring and that policies that promote entrepreneurship may usefully complement policies that encourage labor hoarding by incumbents during recessions. Crisis-founded startups provide employment opportunities for entry-level workers. We investigate whether startups founded during economic crises perform better than those founded in stable times. Contrary to conventional wisdom, we show that crisis-born startups exhibit unique growth patterns. Examining young German firms during the Global Financial Crisis, we find that crisis-born startups experienced easier hiring processes, particularly attracting career starters. This suggests that there may be advantages to entering the market during crises. The findings also highlight the need for nuanced policies to support entrepreneurship in difficult economic environments, as support for new firms may usefully complement policies that encourage labor hoarding in incumbent firms, such as short-time work schemes.