Thrive to revive: turnaround strategies of startups in India

Abstract

In today's fast-paced world of technology and innovation, India stands out as the third-largest startup hub globally, thanks to its favorable business environment. However, despite the promising infrastructure and support systems, many startups face challenges that lead them off course. This research focuses on understanding why startups sometimes struggle and how they can bounce back. The study explores the reasons behind these struggles and the strategies startups use to recover. Additionally, we investigate if the sector and stage of a startup play a role in determining the success of these turnaround strategies. A survey of 120 startups that underwent a turnaround, reveals that a lack of funds and changing customer preferences were significant factors influencing these situations. Interestingly, it was discovered that the healthcare sector is particularly well-suited for successful turnarounds, and these strategies are more effective during the growth stage of startups. The findings provide practical insights for startups, helping them tailor their turnaround strategies based on their unique business nature and developmental stage. This research not only contributes to the academic understanding of startup challenges but also offers a useful guide for entrepreneurs navigating the ups and downs of their business journey. In the past few years, startups and unicorns have become the talk of the town, marking a major breakthrough in this decade. Globally, we've witnessed a surge in startups popping up everywhere, and India has been at the forefront of this exciting trend. While the term "startup" used to be synonymous with Silicon Valley giants like Facebook and Google, things have changed with the evolving world. Now, India proudly holds the third spot in the global startup ecosystem, following only the United States and China. This evolution has had a significant impact on India's economy over the last two decades.