The availability of capital or liquidity is going to be a big challenge for early-stage start-ups in the post-Covid scenario and those able to significantly address this challenge will be winners, said Thillai Rajan A, Professor, IIT Madras during the webinar hosted by BusinessLine and moderated by its Editor, Raghavan Srinivasan, on Wednesday.
The webinar titled Post COVID: The landscape for start-ups and entrepreneurs covered how various aspects of the start-up ecosystem will be impacted in the post-pandemic scenario.
Talking about the effect of Covid-19 on businesses, Rajan said that while travel, hospitality and grooming sectors have dramatically gone down, businesses in medical equipment, sanitisers, testing kits, work from home aids have taken off in a big way. “Businesses that shrunk dramatically are not going to be in a position to expand in the same dramatic pace,” said Rajan. The expansion and the resuming normal operations for them will be at a much slower pace, he added.
The webinar also shed light on what the new normal will be post pandemic and how much of an impact it will have on investors and founders. Rajan also highlighted the major trends that can be expected such as uncertainty in product and capital markets, the discretionary spending reducing significantly, new sunrise sectors such as healthcare and personal transport, and how the focus will be on costs.
Rajan also noted that the investment duration for start-ups will be longer in the post-Covid scenario. He added that investors would expect more skin in the game from the promoters and founders before they make an investment.