Startups in times of crisis – A rapid response to the COVID-19 pandemic

By Andreas Kuckertz, L. Brändle, Anja Gaudig, S. Hinderer, Carlos Arturo Morales Reyes, Alicia Prochotta, Kathrin M. Steinbrink, Elisabeth S. C. Berger. Journal of Business Venturing Insights, 2020

924 citations recorded by the source corpus.

Research summary The discovery of the coronavirus (SARS-CoV-2) and the spread of COVID-19 have led many governments to take drastic measures. The lockdown of large parts of society and economic life has come as an exogenous shock to many economic actors, not least innovative startups. This rapid response research combines a qualitative research design informed by entrepreneurial ecosystem actors with an analysis of policy measures called for, announced, and reportedly implemented in the international press. Interviews from an entrepreneurial ecosystem offer a first-hand account of the adversity startups face during a crisis and how by utilizing bricolage responses they cope, and the analysis of policy measures can serve as an inspiration to design support initiatives to protect startups from the consequences of the current lockdown and to alleviate the effects of future crises. Managerial summary The lockdown measures as a response to the spread of the new coronavirus threaten the existence of many innovative startups. Our rapid response research first illustrates the challenges entrepreneurs face as a consequence of the crisis. Second, we illustrate how entrepreneurs are dealing with the effects of the crisis and what they are doing to protect their ventures. Finally, we present measures that could be utilized by policymakers to assist entrepreneurs facing challenges. The research conducted suggests that while startups are successfully leveraging their available resources as a first response to the crisis, their growth and innovation potential are at risk. Therefore, policy measures should not only provide first aid to startups by alleviating the pressure caused by constrained cashflow, but also involve long-term measures embedded in and supported by the wider entrepreneurial ecosystem to ensure rapid recovery and growth.

Subfields: Business and International Management, Economics and Econometrics, Management of Technology and Innovation

View Paper: https://www.semanticscholar.org/paper/84ac6945b787f54b0434ec5b642cf4208a7bb109

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Citations in the corpus

The impact of social capital and collaborative knowledge creation on e-business proactiveness and organizational agility in responding to the COVID-19 crisis (2020, background): “These perspectives include human resources (Carnevale & Hatak, 2020), innovation (Chesbrough, 2020), entrepreneurship (Kuckertz et al., 2020), and family firms (Kraus et al.”
Identifying Digital Transformation Paths in the Business Model of SMEs during the COVID-19 Pandemic (2020, background): “The various challenges faced by SMEs include decreased customer purchasing power, restrictions on interaction and working hours, shortages of raw materials, cancellation of orders, cash flow difficulties, and supply chain disruption [10,32].”
Perceived social impacts of tourism and quality-of-life: a new conceptual model (2020, background): “People may be motivated by high levels of place attachment to address economic and societal goals (Kuckertz et al., 2020).”
COVID‐19 and entrepreneurship: Future research directions (2021, background): “To reduce the spread of the disease, nonpharmaceutical interventions such as social distancing were implemented (Kuckertz et al., 2020).”
Exogenous shocks and the adaptive capacity of family firms: exploring behavioral changes and digital technologies in the COVID‐19 pandemic (2021, background): “Hence, the COVID- 19 pandemic is an exogenous shock, as it has drastic implications for companies that have been affected by contact restrictions and lockdowns in their respective countries (Kuckertz et al., 2020).”
Innovative Finance, Technological Adaptation and SMEs Sustainability: The Mediating Role of Government Support during COVID-19 Pandemic (2021, background): “Many economists consider this epidemic as a metaphorical “black swan” event, defined as “an unexpected, unanticipated occurrence of tremendous importance and severe effects that profoundly transforms the political and economic landscape that leads to business failure” [11].”
Hop to it! The impact of organization type on innovation response time to the COVID-19 crisis (2020, positive): “…of our analysis for established firms and their innovation management could thus be not only to avoid cutting down on innovation activities but also to ensure that start-ups will continue to be part of a “holistic and overarching corporate innovation system” (Kötting & Kuckertz, 2020, p. 90).”
International entrepreneurship in the post Covid world (2020, background): “This is likely to pose a serious challenge to many INVs that have to do more and more with limited resources in an increasingly volatile business environment (Kuckertz et al., 2020).”
COVID‐19: Small and medium enterprises challenges and responses with creativity, innovation, and entrepreneurship (2021, positive): “Crisis management fosters resilience (Kuckertz et al., 2020).”
The coronavirus (COVID-19) pandemic: challenges among Iranian startups (2020, methodology): “Nevertheless, there are currently a few published academic manuscripts and publications regarding their challenges (Kuckertz et al. 2020).”
Entrepreneurial behaviour: The effects of the fear and anxiety of Covid-19 and business opportunity recognition (2021, background): “Kuckertz et al. (2020) also reported that the existence of many start-ups has been threatened by the lockdown measures to control the spread of the Covid-19 pandemic.”