The economy is crashing. Stock portfolios are shrinking. And entrepreneurs are wondering where they are going to turn for help.

Smartsheet.com co-founder Brent Frei has an answer to the madness. "Invest in yourself," said Frei, who decided to participate in the company's $1.25 million venture round that was announced today.

Of course, that's easier to do when you have a venture capital firm like Madrona Venture Group participating in the deal. But Frei -- who prevously founded Onyx Software -- said it is better to take a risk on yourself in this climate than to let the money get beat up in the stock market. In fact, that's exactly what Frei had to say to his stock broker when he took the money out of his account to help fund Smartsheet.

"There’s no better time to double down on yourself than when the tailwinds are out of everyone's sail and you have strong rowers," he writes in a well-crafted blog post today on the funding. "Market inertia won't be driving your competitors around you, they'll have to put their backs to the oars if they expect to survive."

In an interview, Frei said that he sees similarities between Smartsheet.com -- a low-cost online business service -- and the market share gains achieved by Salesforce.com during the tech bust. His theory, customers flocked to a cheaper, more innovative solution.

Smartsheet, which makes a online project management tool for small businesses, is hoping it can follow on that success. Having a low-cost productivity application "isn't a bad product to have in this climate," he said.

In fact, Smartsheet signed up three times as many clients as it did in the fourth quarter than it did in the first three quarters combined, he said. The product ranges in price from free to $60 per month.

An inside round led by Madrona, Frei said that the company decided not to waste its time by trying to find external investors.

"Given the nature of the investment climate out there, it seemed like a waste to go shopping it around," he said.

With the new money, Frei expects the company to reach cash flow positive some time next year. Total funding now stands at $5.56 million.