Since COVID-19 conquered the world, the business stayed under unprecedented pressure. In particular, start-ups turned out to be endangered as well as “red zoned” while 40% of them became unprofitable, according to COVID-19 Survey. So how can a tech startup survive during the global venture drops and the raging pandemic goes on? The answer is – DNA origami implementation which calls for openness, cross-industry collaboration, and sharing of ideas on the global level to create the best possible and most needed startups in technology. Business experts state that the times of uncertainty can become an actual goldmine for the challenging and flexible startups willing to take risks and invest in the future economic growth of their countries.
Startups in times of crisis
Startup Genome reports that policymakers should put all their power to let companies create and survive. Harvard Business Review provides the case of Wayfair as an apparent example of how to keep the branch alive with 49% stack revenue while the major competitor Amazon can lose its profits. Apparently, the positive factor for the startups is not only the very surprise of offering something fresh and new but also the ability to remain competitive, original, and low-risk compared to the business flagmen rapidly losing their grip. Thus, the crisis might help the newly-formed and the fresh startups as a platform of skyrocketing their profits if worked out correctly. The mixed-method design of creating something new and highly “in” can lead to removing the adversaries caused by the COVID-19 pandemic and the subsequent lockdowns. These stressful factors lead to the decreased opportunities to preserve talent and keep the innovative ideas afloat as the underpaid workers are stripped of their benefits and demotivated by the pandemic.
Challenges startups face in difficult times
Overall, startups are having a hard time during the pandemic and might be perceived as full of difficult and sometimes deadly challenges, as:
- Lack of proper support from the government in the age of crisis. As startups growth are currently the key to an economic revival, the executing power should focus on easier taxation and medium-size business support to (SMBs) to keep competitive regulatory environments and interest in investors. The creation of “task-forces” eventually brings tech startups to ruin as many of their ideas seem unlikely, costly, and unprofitable.
- Turmoil and demand drop due to the lockdowns. Journal of Business Venturing Insights implies that the burden on the health care system caused further loans and major drops in investment schemes that further kills startups’ initiative.
- Interruption of cash flows as a major number of clients either disappear or cease showing interest due to the COVID, lockdown, or budgeted strains. Thus, luxury goods might be permanently abandoned due to the major focus on health tech products.
- Absence of “disaster resilience” as the majority of them have not created the proper savings to keep personnel and production afloat. Unfortunately, not all countries can stand up to Sweden’s example of preserving more than 90% of employees’ salaries due to their short-term COVID-related leaves.
Opportunities for startups in a time of crisis
Still, not everything with startups looks so bleak and unpromising. The continuous change in production priorities might result in unprecedented opportunities such as:
- Creation of the unique product straight up the clients’ needs. E.g., WeCare and CoronaFree are the best possible options, according to EU-Startups.com. While the first app aims at seeking financial opportunities for the young families-in-need, CoronaFree helps to issue ECDC Stockholm “immunity certificates” to facilitate the client’s transition to a post-lockdown life.
- Cross-industry collaboration to provide innovations to tech startups. Robotics, IoT, AI such as medical DeepMind from NHS Great Britain and VoiceMed from Italy provide lengthy and fruitful integration of AI and healthcare. Thus, the potential COVID patients might estimate their symptoms remotely or gain telemedicine via their smartphones and other gadgets.
- Stay adaptable and low-risk apart from larger corporate sharks. A data-driven approach can provide up to 30-40 experiments within the single company, Chris Locke of Startup Europe narrates. E.g., the UK announced unprecedented co-financing for the innovative companies that face financial difficulties according to OECD 2020a. That is where the stagnating companies can take a deep breath and start the daring experiments to bring development ideas to the table.
Innovations for startups to grow when it's hard to exist
The potential creator should not fear to fulfill the most daring ambitions and call for action in the time of crisis. The main winning positions in technology startups should follow three major principles as
- Cross-industry approach
- Data-driven approach
- Health tech orientation and research actuality
The investment in 3D printing, engineering, nanotechnology, robotics, and Coronavirus prevention and diagnosing might serve the best potential strategy to gain both support and the possibility to soar. For instance, HealthTech startups bring collaboration between the State government in India and the VCs leading entrepreneurs, ACT reports (Action COVID-19 Team). US Zipline, a medical drone delivery, is currently getting an FAA (Federal Aviation Administration) grant to roll out out-of-contact deliveries. The eCommerce industry grows while work-from-home tools like Zoom are growing. The CORE MaaS reshapes mobility creating the source marketplace as a startup growth opportunity. Eventually, the demand for the COVID-19 safety and provision of the goods and medicine leaves much space for any daring idea.
Startups remain not only the highly innovative market segment but currently serve as the source of economic rebuilding. As business is currently facing numerous challenges while its growth is hampered, tech startups can bring a hunger for innovation and AI into the market top. As blatant copying and isolated approaches are left behind, the companies should face the new reality of infrastructural activities, active collaboration, and adaptability in this uneasy time. That is how tech startups become the flesh and blood of modern innovations and the unceasing source of ideas not only eases the COVID-19 pandemic struggle but safely brings us into the digital future.
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