The effects of the COVID-19 pandemic on startups

Putting causation, effectuation, and crucible strategies into practice

Abstract

Purpose: Companies around the world have been challenged by the unprecedented crisis caused by the COVID-19 pandemic. Although several studies have been conducted to understand how companies are surviving these challenges, little attention has been paid to survival strategies among startups. This research intends to address this gap by exploring how startups have put into practice causation, effectuation and/or crucible strategies in attempting to secure the survival of their businesses. Design/methodology/approach: Applying an inductive approach, this research uses descriptive and comparative 3 case studies from three Brazilian startups. Findings: The main findings reveal that: (i) the startups have been able to create positive effects from the COVID-19 pandemic after adopting different sets of causation, effectuation and crucible strategies; (ii) the emergence of the Reborn Epidemic Company concept has developed since startups started generating revenue following changes implemented due to the effects of the pandemic; (iii) crucible strategies have been successfully implemented by startup 2 in redesigning the business entirely and reorienting its product towards a completely new market niche. Originality: The findings corroborate the emergent Low-Touch Economy paradigm. Theoretical and practical contributions are addressed, as well as suggestions for future research.