The lockdown measures taken in response to the coronavirus have put many innovative startups in jeopardy.
The pandemic caused widespread disruptions in the demand and supply of goods and services due to quarantines and resulting travel disruptions. So it was no surprise that thousands of businesses worldwide succumbed to supply chain disruptions, productivity losses, and facility closures.
Consider this: the critical supply chain elements for 94% of Fortune 1000 companies were housed near the epicenter of the outbreak in China. And many of these businesses were caught completely unaware by the supply-side shocks.
Even central banks couldn’t do much to contain the fallout because financial stimulus can’t really do much against production paralysis.
This was the ultimate stress test, especially for young firms that were left reeling from the worst economic slowdown of the millennium.
The Future For Startups After Covid-19
Most new businesses are emerging companies where innovation, disruption, and technology form the philosophy fueling their growth. Startups that thrive in the future must show the following traits:
Flexible Business Models
In the weeks and months that followed the onset of covid-19, e-commerce businesses were the first to rebound from the shakeup.
People could no longer go to stores, they wanted to eat healthy in hopes of building up their immunities, and they had to abide by social distancing measures. As a result, e-commerce shot up by 300% in Latin America alone.
But only agile and consistent businesses, many startups included, had the ability to ride this wave while all else collapsed around them.
Most businesses that survived the pandemic only did so because they decided early on to establish a remote policy. This decentralization of work was welcomed by employees because now they could abide by their quarantines without missing out on work.
However, not many employers could survive work from home. Startups that prioritize cybersecurity ensure the safety of their business, processes, data, and people who work for them. Only then can they hope to keep the staff and customers happy at the same time when they know that their data is safe
with a culture.
Another space where startups excel is creating a digital culture where they obsess over their customers and record the smallest metrics to find room for improvement. When decisions are made based on data, it automatically removes many of the risks and stressors resulting from the impact of covid-19 on a business.
Traditional businesses can have trouble cultivating the rapid experimentation and self-organization that startups take for granted. These practices can see alien to organizations that were designed for risk-aversion and cautious stability.
Investment in Innovation
There is no denying the fact that digital transformation and innovation have become the cornerstones of successful firms.
Startup venture studios help these young businesses find ways to stimulate growth by investing in exciting new technologies. These new projects are often focused on market demand but may need external support to their ambitions.
Covid-19 has made long-lasting changes in societies and consumer habits across the world. Startups that keep an eye on this ongoing evolution will find ways to make the most of it as global value chains and entire cities transform.
Policymakers, venture capitalists, startup consultants, and other key influencers and decision-makers can come together to lift entrepreneurial potential while also reducing barriers to free enterprise.
This means providing startups with the help they need to keep working in the short-term and limiting the disastrous effects of a lost generation of startups.
The good news here is that these young firms are resilient and robust, and they only get resilient with stress and instability. They’ve applied innovative approaches to the market while staying true to their values. So, in essence, startups could be the actual survivors of this pandemic.