The Great Disruptive Transformation: The Impact of COVID-19 crisis on Innovative Startups in India

Abstract

Startups are one of the main agents of creative destruction especially in times of crisis, because of their favourable characteristics such as size, exibility and lack of bureaucracy. This study aimed to investigate how hi-tech innovative startups in India are responding to the COVID-19 crisis and how the crisis stimulates creative destruction. Towards this purpose, Schumpeterian innovation theory has been combined with dilemma theory and Trompenaars' seven dimensions of national cultural di erences. The design deployed in this study entailed a qualitative case study approach, involving in-depth interviews with the leaders from 15 hi-tech startups in India from various industries. The results demonstrate that the investigated startups are undergoing major transformations. They are successfully pivoting to new business models and new markets based upon their core capabilities. They are experiencing emerging opportunities, and are innovating in various ways, resembling both Schumpeterian evolutionary economics notions of creative destruction and creative accumulation. Seven major dilemmas have been identi ed and reconciled. These reconciled dilemmas, coupled with several identi ed key learning points, provide further understanding and knowledge on best entrepreneurial practices to support startups through the COVID-19 crisis, potentially relevant to a broader context than the current study.