Start-ups have emerged in the last years as key drivers of economic growth and job creation. Their businesses are based on technology and innovation and they play a key role in the economy.
The COVID-19 crisis hit everywhere. As opposed to big companies that have more resources to hold their financial balance, Start-ups are more vulnerable. The lack of financial support could put their survival in danger, which affects a large number of people.
They have a significant role in the economy not only because they employ lots of young people, but also because they develop new technologies and innovative products or services. This is one of the reasons why Starts-up should receive some support through special policies. The crisis is reducing the creation of new firms, challenging the current ones' survival and limiting their growth.
Start-ups have shown that they can quickly adapt their business to the current situation. They've brought big innovations to many fields: telemedicine, remote personal care, medical equipment, home delivery, food processing, teleworking, and online education.
If Start-ups get the right stimulus, they can show their best skills and play a significant role in the community. Sometimes, a crisis helps to sharpen creativity. In fact, many successful businesses emerged as Start-ups during a crisis, like Dropbox, Uber, Airbnb, WhatsApp, Groupon, and Pinterest, all founded during or just after the global financial crisis.
In order to give them opportunities for growth, there should be some policy intervention. In the short-term, there should be financial help with minimal bureaucracy, and promotion in investments in skills and online training. During the crisis, it'll help to keep current employers updated, and encourage the upskilling of start-up workers.
Policymakers should also take into consideration the short-term liquidity and the availability of funding. Available fundings are key for innovative start-ups at all stages of their development. The government could provide additional public funds to public venture capital umbrella-fund-investors, which can be used in co-investment with private investors for financing start-ups.
Finally, entrepreneurs should receive the right incentives in the easiest way. It's never comfortable to face red tape, but during the crisis, it's much worse. Administrative burdens and complex procedures discourage any initiative, and Start-ups already face enough significant challenges during COVID-19.
BONUS TRACK: HOW TO BECOME A SUCCESSFUL ENTREPRENEUR
Financial problems and poor management decisions are the main reasons why start-ups fail, but some strategies can avoid this happening to yours. Follow these tips and increase your chances of success:
1. Go From Hobbyist to Entrepreneur
You may have a hobby that people are always saying you should be selling. It may be your birthday cakes, the sweaters you knit, the web pages you help friends design, or the way you can fix your own car. If this is the case, maybe you should consider taking their advice and turning it into a business.
Doing something you love, is the best secret to enjoy your work. You already have expertise in your field of choice, which is a necessary ingredient for success. So, whether it’s an on-the-side job or your new regular job, all you need to do is to start thinking like a successful entrepreneur.
2. Create A Business Plan
Create a business plan that includes details about your company’s product line, organizational structure, marketing strategies, and goals. This provides an entrepreneur such as yourself with an agenda for reaching your objectives. A well-developed business plan can also help you get financial help if necessary.
3. Know Your Target Audience
Identifying your customers will help you determine what the best sales strategy is. If you know who you are aiming at with your business, promotions, advertising, and communication plannings become a lot easier. Basing your target customers on age, sex, income, or lifestyle are some of the possible options.
4. Study Your Competition
Once you have decided what you are going to offer, and who you are going to offer it to, you need to look into your competitors. Finding out what customers think, at what things they are good at, and at what things they are not, will help you work on what your target audience is needing. It can also give you an idea of how to price your products or services.