The coronavirus pandemic has many businesses on the ropes, but it has also inspired a lot of innovation and startup activity. Employees have had the time and mental space to think about their lives, and, for many, that time has led them to recognize potential business opportunities and to consider pursuing them.
Find out how the global pandemic could spark new and innovative startup opportunities.
The silver lining
"Economic downturns are like fertile land for startups," says Tim Reitsma, co-founder of People Managing People, and the coronavirus pandemic is no different. With employees being furloughed or let go from their jobs due to economic distress caused by the pandemic and, consequently, having the time and space to devote to exploring new business ideas, startups are bound to emerge.
"The COVID-19 'time-out' has enabled aspiring entrepreneurs to re-examine their life's goals, reflect on their quality of life, and ultimately commit to pursuing that new business idea they've "always wanted to do," says Bryan Mattimore, co-founder of Growth Engine. "The 'time-out' that the pandemic has forced on us has also sparked, and history will show unprecedented levels of creativity—indeed a creative renaissance of a kind—especially among those able to ply their trade in isolation." Writers, artists, and songwriters are among those who may now have time to explore their creativity.
Some will be in response to new problems discovered or exposed by the pandemic lockdown. "Times of crisis are opportunities for businesses to fill a demand, as there is a proven need," says Ruggero Loda, founder of Running Shoes Guru.
New solutions to new problems
With the massive shift to working from home, increased concern for cleanliness and personal health, dramatic reductions in traffic, supply chain backlogs due to a dearth of workers, to name just a few challenges that have emerged during the coronavirus response, new business and consumer needs have appeared.
Marc Ian Snyderman, Esq, of the Snyderman Law Group, PC says, "I've been approached by multiple entrepreneurs and am involved in a series of different projects which are both related to or caused by COVID-19, as well as other new ideas. There's an entire suite of new projects that will arise around the concepts of work from home and reduction in travel on a longer-term basis."
Michael Hamelburger, CEO of The Bottom Line Group, also sees opportunities. "However, I believe that these startups will have to do with healthcare-related needs and those that involve immediate deliveries to adjust to the new normal. There will also be more online businesses, as well as physical stores that require cashless payments."
However, Mattimore cautions that, while the pandemic will spark new startups, those new ventures will be of the self-funded variety. Startups needing funding will take longer to get going because, "in many cases, the private equity funds are being used at this time to keep their current investments afloat," Mattimore says.
He says that some of the new services, products, and business models will likely include home delivery, community fundraising, virtual celebrations, new distribution channels, subscription models, and new positioning of products and services for added safety.
On top of new solutions to our new reality, some ventures will choose instead to innovate in response to previously existing challenges.
New solutions to older problems
The uncertainty that the coronavirus brought to the business world will likely push society "towards digital-first experiences and investing in high-tech bio and healthcare technologies," says Christian Antonoff, co-founder of Excel Template.
"There will be a growing need to find new ways and solutions to problems in the healthcare, financial, and other sectors," Antonoff says. Some of those solutions may include digitalization, increased use of virtual reality, and more interactive online events.
Brian Folmer, CEO of FirstLook, doesn't believe we will come out of this pandemic with more startups, though. "Straightforward economics don't allow it," he says. "We will come out of this with an uptick in exciting, higher quality brands."
According to Folmer, "The founders who are persistent, scrappy, and creative are finding ways to continue pushing forward. They are separating themselves from the pack."