Tag Archives: Covid-19

How to Support Your Startup Ecosystem in Times of Crisis

In this article, we are not going to discuss the steps you need to take to support your startup ecosystem, because there aren’t any! Instead, there are a variety of potential steps or procedures and you can choose what, if anything, is relevant. 

Here we are going to go deep into the philosophy and the basic principles of how to approach this issue, before you start implementing changes and allocating resources. 

Stay on top of emerging trends 

Startup innovation and entrepreneurship happens even during times of crisis, In fact, many might even come to see this time as a tremendous opportunity to foster new ecosystem development growth. You can access more reports on global and regional economic development as well as our new Coronavirus Innovation Map that shows the best countries fighting the pandemic and facilitating new developments in the pandemic era.

How To Support Your Startup Ecosystem Development

The Good and the Bad 

If you play your cards right in time of crisis you can actually save the startup ecosystem in some capacity and allow those that have the most potential to persist. At the same time, your government policy can create a situation where the bad players or those that have to be cleared out are eliminated. 

First of all, government and public sector officials are needed a lot more in ecosystem development in times of crisis rather than during routine times. In everyday situations, they help the wave go wherever it does and cannot make that much of a difference bar some exceptional examples of ecosystem development. However, during times of crisis, they have a lot more influence and can make or break startup ecosystem developments to a larger capacity. 

We have to remember this is not only a positive thing, your interference can create a legacy of a broken startup ecosystem. It is possible that the things you implement will distort the startup ecosystem and create situations that are hard to recover from due to a problematic intervention. 

No textbook solutions 

It is then clear, that the decisions and ideas put forward during times of crisis should not be taken lightly. This is not a textbook situation where you can implement steps of tried and tested strategies that will work for all startup ecosystems. 

Actually, one of the worst things you can do is to copy-paste from what other countries are doing. Just because something works in one country doesn’t mean it is the best course of action for you and it will most probably bring totally different outcomes. Each startup ecosystem is distinctive in its needs, placement, and potential and thus the steps that you will need to take according to the current changes will also need to be customized to each particular case. 

This means you need to tread carefully and acknowledge that there are no clear guidelines. The unknown variables are bigger than the known and you might be doing more damage than good by interfering.

You will be expected to interfere 

While your actions need to take into consideration the real possibility of inflicting more damage than good, doing nothing is not an option either. 

The public expects you to interfere. The startup ecosystems themselves expect you to interfere and to provide support. It is crucial to show that you care enough about innovation in your country to allocate resources to save startup ecosystem developments if needed. 

At the same time, your approach should signal that you are thinking and researching deeply on what the best measures are based on the specific needs of your startup ecosystem and that you are ready to step in and intervene when it is time. 

The Hero Doesn’t Save Everyone 

One of the main things to take into consideration here is that 90% of startup ecosystems are dead. This is not a Catcher in the Rye moment and you are not going to be able to help all the children from falling off a cliff. 

This is also not a situation where you want the survival rate of startup ecosystem developments to be higher during the crisis than during routine times. 

Ask the right questions 

What changes during a crisis? 

The first thing that changes during a crisis is that the startups that are mature and are generating revenue may be hit fatally due to the industry they are in. For example, an amazing startup like Airbnb that has built something in the tourism and hospitality sector will be disproportionately hit during a global pandemic like Covid-19. 

While startups are not alone in requesting help and begging for rescue packages, sometimes less than one month after the beginning of the crisis, they must be defended because they didn’t have enough time to build the cushion that we expect the bigger companies to have. 

Which are the quality startups? 

To start with, it is important to locate high-quality startups in the industry that you believe are going to bounce back. If you are lucky enough to have a startup in a competitive and profitable industry like aviation, tourism, and hospitality, and expect things to recover in some capacity, you don’t want to lose your best technical talent just because of this situation. 

What are the investors doing? 

This is the second thing to consider and most people, in general, will assume that investors are playing it safe. Whether that is true will need to be determined on an individual case basis.

In general, times of crisis still offer plenty of opportunities, people have money to invest and there is often an exodus from the stock market. In addition, this is a time where we see massive value deflation, which is not necessarily bad for your startup ecosystem development. 

There is a little bit of a clearing process here when we talk about investors, that makes a lot of sense. However, we still need to take into account the possibility that investors are much more defensive right now. It could once again be a positive thing. Maybe they are focusing on the things that they should have invested in all along. If that is the case, not interfering with the private market might be advisable. 

However, if that is not the case, and investors are much less aggressive now than in other situations, an intervention will be necessary. Starting with an acknowledgment that there is going to be downward valuations and the dilutions are going to be bigger, you have to pick startups that the private sector would have picked anyway. That means that whatever solutions are being implemented, will need to have skin in the game for VCs and someone participating in the rounds. You don’t want to be distributing the money at random. 

One option, may be to cover a percentage of an investment. For example, covering 50% of the total investment value while they are receiving more or less the same as before. This way, you are taking the hit together with the startups that are getting highly diluted in order to stay alive and that is okay. It is important to note that Taxpayer money should not necessarily cover those rounds to be matching what they used to be before. 

Bootstrap Startups 

Regarding bootstrap startups, the possibility of most of them failing is even higher. Specifically, the kinds of bootstrapped startups that by definition do not have a lot of revenue. If your startup ecosystem is not investor driven and not investor motivated, there isn’t much you can do or should do other than identifying the first type of startups we discussed above with high revenue and good potential.

Don’t Save… Leverage 

This is one of the most important things you can do to support your startup ecosystem development and it requires a change in mindset above everything else. One of the things we have noticed in Startup Blink is that crisis time is the best time for startup ecosystem growth. 

In part, this is due to the fact that a lot more talent is drifting into startups after previously not being able to. Possibly, previous alternatives, in conventional 9-5 jobs, were too good. Whereas now they feel less secure or are already out of reach. 

Instead of looking at it as a difficult time, look at it as the time your startup ecosystem can evolve to the next step. 

The things that you can accomplish during a period of crisis, massive jumps, product development, and innovation, cannot be done during normal times. The talent pool that has always wanted to dive within the startup ecosystem pool will increase due to a lack of alternatives. 

A few ways to support a growth rather than disaster mindset (for ecosystem developers) 

  • Try to make regulations much easier. 
  • Make registering a startup easier. 
  • Consider giving grants to those who are just starting out. 
  • Organize hackathons 
  • Recreate online events where people can meet and foster new ideas 
  • Focus on the opportunity that this period of crisis has created 

Summing Up 

We urge you to consider this time as a massive opportunity for growth rather than a massive crisis that you have to pick up the pieces from. There is no doubt that you will be tasked and expected to support and interfere. But you can still invest most of your energy into making sure that the leap towards new types of innovation happens. 

The most innovative countries and cities in the time of covid-19

The Coronavirus Innovation Map launched together with Health Innovation Index (HIEx) by the UNAIDS and Moscow Agency of Innovations and other global information partners such as Crunchbase, Meetup, and SEMrush, now features hundreds of initiatives and solutions aiming to solve problems caused by the COVID-19 virus as well as to help people cope and adapt to life amid the global pandemic.  You can read more about the map here.

As we learn about new projects every day, we would like to acknowledge and celebrate the innovators in the most active locations on the coronavirus innovation scene. We are proud to release the first-ever global COVID-19 Innovation Ranking featuring the top cities and countries on the scene. 

The first run of the rankings reveals an interesting insight that some of the cities that have been badly hit by the crisis such as New York, Milan, Paris, London, Beijing, and Barcelona, are the ones that have been mostly over-performing in the charts. This is counterintuitive since those cities are in a major crisis, but still, manage to excel and innovate due to the needs they are facing.

As for the top 20 countries ranking, we see that specific countries in Europe such as Estonia, Switzerland, Italy, and Ireland are surprisingly over-performing in COVID-related innovation compared to their general rankings in our 2019 global ecosystem ranking report.  

Coronavirus Innovation – Cities Rankings

San Francisco takes the top spot on the list of most innovative cities for coronavirus just like in our Global Ecosystem Report. We see that this city continues to top the rankings regardless of the industry and it is inspiring to see that it also comes first in the world when it comes to COVID-19 related innovation.

San Francisco is followed by two other US cities, also on the podium: Boston and New York. Boston is historically known for having great health-related startups and that is shown as it takes the second spot in this rankings. In the previous rankings we have done, we see that Boston is always in the top 5 cities but never second. This shows its resilience and excellence in producing health-related startups and initiatives. New York, on the other hand, is known for its FinTech startups but we see that it takes third. Its response and adaptation to the effects of the Coronavirus crisis have been outstanding considering that it has been one of the worst-hit areas in the world and we think that this is exactly why they’re excelling.

Toronto is featured in the fourth spot which is a higher sport compared to what we see in our general rankings, showing that this Canadian city is over-performing in response to COVID-19. It is followed by Milan which is the biggest surprise for us in this rankings. It usually ranks relatively low in the other rankings we have done in the past. Considering how badly hit the Milan region was during the crisis, they’re doing incredibly well. Closing in the top 5 is London which is usually in our top 3 cities in previous rankings. This shows that although it s actively innovating in the time of this pandemic it is relatively underperforming considering its potential.

Seattle takes 6th place which is higher than it’s usual ranking. As another city that has been badly hit by the crisis, we see a trend of the worst-hit cities innovating when faced with adversity. Zurich for a long time has been on the radar for global innovation but it doesn’t rank this high in our Ecosystem Rankings. It has been doing great in the deep tech field and has is also playing an active role in global initiatives that try to combat the effects of the pandemic. Moscow is a giant ecosystem that has to build its own unique and special solutions in many cases. Being a megacity, it seems that it has been developing innovations that has to deal with COVID-19. Paris is another badly hit city and it joins other badly hit cities that are overperforming.

Tel Aviv, at 11th spot, is doing really well. Although it is currently underperforming considering that it usually ranks higher in previous rankings where it was always in the top 10. Taipei City, at 12th, is an example of how Taiwan is doing amazing work in dealing with this crisis. They are leading the way in public policy on the ways to deal and contain the crisis. Dublin is another city that is overperforming considering how it usually ranks in previous reports. Beijing is in 14th place and since the pandemic originated from China it is natural to see various innovations coming from here. We notice that a lot of these Chinese innovations are local solutions, similar to Moscow, nevertheless, they still have a global impact.

The three US cities in the second half of the rankings, Austin, Denver, and Washington usually are not in the top 20 of our previous rankings but due to the impact of the crisis in the USA these cities are doing substantially well. Barcelona is another city that has been badly hit and we see that it does not rank as high as it usually does. However, it is ranked higher than Madrid showing that most Spanish innovations during this time are coming from this city.

Closing up the top 20 cities are Vancouver and Tallin. Both cities are usually not in our previous rankings and it shows that both are doing great in the face of this pandemic.

The first run of the rankings reveals an interesting insight that some of the cities that have been badly hit by the pandemic such as New York, Milan, Paris, London, Beijing, and Barcelona, are the ones that have been mostly over-performing in the charts. This is counterintuitive since those cities are in a major crisis, but still, manage to excel and innovate due to the needs they are facing. Also noteworthy that some top cities, such as Miland and Zurich, both in the top ten, stand out on the global coronavirus innovation scene, with a much better position than in the global startup ecosystem rankings, an assessment in a more general startup and innovation context, also by StartupBlink. 

Coronavirus Innovation – Countries Rankings

The United States leads the global coronavirus innovation efforts, according to the rankings published by Coronavirus Innovation Map. While Canada takes the second spot, the rest of the top five spots are given to the relatively small nations of Estonia, Switzerland, and Israel. Also in the top ten are Ireland, Italy, the United Kingdom, France, and Spain. Although the top twenty list is dominated by Europe and North America, some of the most promising coronavirus innovations are also emerging in Asia (China, Taiwan, India, Philippines) and Australia, which appear in the second half of the top 20 rankings. 

Two countries to note which do not have cities in the city rankings are Germany and Australia at 14th and 15th place, respectively. In the case of Germany, we see that although no single city stands out it has various cities that are producing innovative solutions. Similar to Germany, Australia also has a variety of cities that have coronavirus-related initiatives and this variety places it in the top 20 countries.

As for the top 20 countries ranking, we see that specific countries in Europe such as Estonia, Switzerland, Italy, and Ireland are surprisingly over-performing in COVID-related innovation compared to their general rankings in our 2019 global ecosystem rankings report. We also see countries such as Poland, Portugal, and the Philippines performing better than usual since they are not typically in the top 20 in previous rankings.

Methodology

In its current form, the rankings consider the number of innovations in each city and country, with extra points given for selected outstanding initiatives, identified as the “champions”. Although StartupBlink has a broad experience in startup ecosystem research and rankings, this is only our early attempt to quantify innovation in the coronavirus context. The current COVID-19 Innovation Ranking methodology is not evergreen and we will continue adapting and innovating the algorithm as we gather more data.

The ranking will be updated regularly and you can influence it by submitting innovative projects related to COVID-19 here.

The world needs good news now. We hope that the rankings will energize and encourage the innovators around the world who will work even harder against the virus.

CORONAVIRUS (COVID-19) Global INNOVATION STARTUP MAP by StartupBlink

With the emergence and clear effect of the Coronavirus (COVID-19), people around the world are dramatically changing all aspects of life. This is an unfortunate circumstance that no one can escape, but as human beings are resilient creatures, we survive, and most importantly, we innovate.

We at StartupBlink recognize this change, and we decided to use our technology to help spread the innovation in this global quest to stop the virus. Together with the Health Innovation Exchange (HIEx) by UNAIDS and Moscow Agency of Innovations, we have launched the Coronavirus Innovation Map.

Continue reading CORONAVIRUS (COVID-19) Global INNOVATION STARTUP MAP by StartupBlink