What opportunities lie ahead for startups and MSMEs in the post-pandemic world

As businesses across the world get disrupted amidst the coronavirus pandemic, a ‘new normal’ is on the horizon. How will this look like for startups and MSMEs moving ahead?
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With COVID-19 having disrupted the entire world for the year 2020 at least, theories around how the pandemic is going to define the ‘new normal’ are being discussed almost daily. Social distancing has become the basic requirement for now and is likely to remain so even in the post-pandemic era.


While factoring in ‘social distancing’ in our personal lives seems challenging enough from a long-term perspective, the impact that it has had, and will continue to have, in the business world is far and beyond.


The short-term adverse effect on India Inc. is already visible and relatable for many. Now that the pandemic has moved the proverbial ‘cheese’, stakeholders need to figure out the best way to capitalise on the opportunities that the new circumstances present.


Startup opportunities

Remote working — consequences and opportunities

Primarily, a lot of companies are moving their focus to the ‘online’ part of their business model. Starting with the availability of ‘basic essentials’ with one click, we now see that various services, which traditionally had a physical set up, are being made seamlessly available right to the comfort and security of our homes.


Similarly, businesses other than traditional ecommerce, including consultancy of almost every kind — whether legal, financial, medical — now have a digital address as a part of business continuity plans to adapt to the pandemic situation.


Thus, incorporating IT-enabled services in any business might become the mantra for a sustainable business model. This presents a huge opportunity for smaller tech-based companies engaged in providing remote working enabling solutions at affordable costs. This is evident from the sudden increase in the popularity of applications like Zoom.


This pandemic has highlighted that businesses with robust IT infrastructure were quick to make the transition. Thus, it underlines that for sustainable future growth for businesses looking to work within this new model, they must invest in sophisticated IT infrastructure and appropriate personnel training.


This is another area where startups and MSMEs may have a head-start since most of these companies are tech-based or are already reliant and comfortable with using technology for their day-to-day operations.


Additionally, companies are looking at reducing their real estate footprint to make remote working a practical possibility in the long run. This gives way to smaller office spaces and coworking spaces, something which is already a part of the culture of startups and MSMEs.


Established companies with big office set-ups may also adapt to this, and save on rentals and associated operational costs.

Entertainment in the times of COVID-19

The pandemic has also fundamentally challenged some of the most popular businesses as we knew them in the tourism and entertainment industry. The players in these industries will need to significantly restructure their business models and this may present a level playing field to young companies looking to compete in a novel manner.


Online entertainment industry is an area, which is likely to see a huge influx since entertainment avenues with physical involvement, such as cinema halls, amusement parks, travelling, etc, will now be pushed back.


Online gaming, including virtual reality (VR) gaming, and streaming of visual content on over-the-top platforms would serve as the go-to for most consumers. Companies may also see ‘bundling of services’ as an impetus to offer an edge to their customers.

Rise of the sanitation industry

In the wake of the pandemic, our society has witnessed a sudden spike in demand for sanitisation products. This too could be a potential opportunity for small and medium businesses to make products such as disinfectants and protective gear available at affordable costs.


Using technology aptly to cater to the sanitation requirements of industries could also be a potential line of business.

Tech and delivery models

With respect to the food hospitality industry, cloud kitchens, and delivery services while already popular, are likely to increase their share in the market.


In the education sector as well, tech-based solutions — enabling institutions to function remotely by conducting lessons, giving assessments and feedback, and offering training online — are likely to see a demand surge.

Impact on investments

Due to these ever-changing circumstances, a lot of pre-existing business models may not appear as lucrative to private equity and venture capital investors, and they may be on a lookout for new potential avenues for investment.


Businesses that fall in line with the post-pandemic normal, especially tech-based solutions and those that support flexibility and adaptability, may potentially garner more interest and funding.

Expected regulatory support

A potential challenge that these newer businesses may face is lack of technology infrastructure supported by a regulatory regime to cater to the requirements of these businesses. The government must enable creation of robust technology infrastructure to support such requirements while ensuring adequate regulation.


Consequently, steps like the introduction of 5G spectrum, amendment and enactment of various information technology and data related laws, including the much-awaited Personal Data Protection Bill, 2019, may also resultantly be taken up on priority now.





With India also being looked at as an investment hotspot in the near future, it would augur well for both India Inc. and the policymakers to proceed in tandem towards capitalising on these opportunities.


Edited by Saheli Sen Gupta

(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)

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