The pandemic has definitely turned everything around resulting in an awkward playing field for most businesses not knowing what right actions need to be done in order for their companies, specifically Tech Startups, to survive the ongoing pandemic.
Challenges during the ongoing pandemic are very much expected for every segment of the industry and although the general growth of the tech industry has not been severely affected, there are still a few underlying problems that these tech startups face in the time of COVID-19.
Here are a few of the major problems that most Tech Startups are experiencing:
- Creative Competition
Since most companies are transitioning to tech, even the entrepreneurs are looking towards a tech-approach for their startups therefore increasing the competition in this industry. The competition when it comes to offering something new is definitely increasing. Uniqueness is now very rare and some entrepreneurs are actually looking towards perfecting certain systems on top of offering new ones.
The competition is fierce as it seems like there are already competitors in just about any niche anyone could possibly think of. The competition right now is mostly in marketing. How do tech startups stand out against the many others just like them or offering a similar niche?
It’s definitely much harder these days to set up a business in an office due to the pandemic. This is probably the biggest change that COVID-19 has impacted in the world. Nowadays, offices aren’t really as practical as they used to be. The problem now is being able to properly communicate with the team.
Due to the whole work-from-home setup, communication has become much harder due to a many different reasons. Some of them are due to family members in the background, unstable internet connection, lack of good conferencing equipment, and etc.
Obtaining funding is a little bit harder nowadays. Everyone is trying to protect their capital instead of investing on something that they aren’t entirely sure of. The pandemic has evidently caused a lot of investors a lot of money so getting private funding could be harder than it normally was.
Although obtaining funding from banks is possible, they’ll most likely turn out to be loans instead of actual funding. This is one of the biggest problems that tech entrepreneurs are facing nowadays. Even the best startups are currently having a hard time right now like how Airbnb almost completely lost its business due to the pandemic.
The situation of most tech startups right now is quite dire but this does not mean that the situation won’t turn around. In fact, most of the best startups right now are tech companies. While other industries like the tourism industry are gravely affected, tech startups have an advantage due to the change even in lifestyle of the general public. One example of this is companies like Zoom whose profits rose massively during the whole pandemic and although the situation has gotten better and people are starting to meet in person, the company has still retained its massive status in the consumer market.
Other advantages of tech startups now in the time of the pandemic is that they are most likely going to be used by the target market. Also, the tech target market has increased with more and more people becoming a bit more tech savvy than before. The younger generation has become one of the biggest consumers of tech products. From games, different apps, all the way to watching YouTube videos and using other applications like Discord or Twitch, the younger generation has definitely contributed to these company’s successes.
Opportunities for tech startups in COVID-19 include the following:
- Bigger Market
Since more people are now using technology, or technology related products and services, the chances of tech startups nowadays are fairly higher than now they previously were. The demand for different tech services and products has also grown as almost everything has transitioned to digital and was sped up due to the pandemic.
The market has grown for both consumers and other tech startup developers which makes other tech startups, especially those that provide programming and development services more in demand nowadays. Another factor of this industry’s growth is in the digitalization of most businesses. Although traditional business used to work, due to the pandemic, digitalization is now a requirement.
- Availability of Resources
Since most tech startups involve going online, well, the best way to source the needed talent to develop the ideal company, services, or products can also be found online. Due to digitalization, even outsourcing the needed skills for accomplishing the best startups can be found online as well.
Another good thing about the competition between service providers is the price drop. The availability of good talent and needed skill can easily be found online since even those professionals have moved towards sourcing clients online as well.
- Infinite Possibilities
The good thing about tech startups is that the source, the market, and also the development all come from the same place which is on the computer or the internet. Depending on the type of product or service that a company offers, the possibilities really are infinite. Of course, just like any other business, this depends entirely on the vision, the availability of resources, and also the availability of talent to make this possible.
Depending on what the entrepreneur wants to achieve, the possibilities are endless when it comes to technology. The growth of the tech industry has been one of the most rapidly increasing industries in the 20th century.
The opportunities for tech startups this 2020 has definitely been fast-tracked due to the reality of COVID-19 having a huge influence on the way technology has been used.
ICTS is a Vietnam-based software development boutique that focuses on cutting-edge technologies. We help startups visualize their product to test market-fit or to raise funds. Contact us and discover what benefits we can bring to your mobile app development project in terms of quality and budget.
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