Crisis Management and Early-Stage Greek Startups : The case of COVID-19 pandemic crisis

Abstract: The COVID-19 pandemic had a worldwide economic effect, and it seems to have produced a challenging economic climate for startups to work in. Thus, the aim of this degree project is to investigate how startups survived the financial and organizational crisis caused by the COVID-19 pandemic, and what was the role of their employees during the crisis. The objective is to look at how early-stage startups in Greece are dealing with the COVID-19 crisis, whether they can utilize crisis management models, and how the crisis encourages creative destruction. Schumpeterian innovation theory has been merged with crisis management theories to achieve this goal. The thesis employs a qualitative methodology and uses a multiple case study design where cases are the individual startups interviewed. Semi-structured in-depth interviews were conducted with a top-management representative of each company.  The results indicate that the startups under discussion are experiencing significant changes. At the beginning of the crisis, they faced a threatening disengagement and demotivation of their employees, which they managed to overcome by focusing on their wellbeing, coaching them, and guiding them through the crisis. The Caplanian model was utilized to analyze their approach. Based on the companies’ core competencies, they are actively pivoting to emerging business models and new markets. These companies are discovering new possibilities and innovating in a number of areas, following both the Schumpeterian evolutionary theories of creative destruction and creative accumulation. Overall, the findings suggest that in responding to the crisis, startups modified and strengthened their strategies. The shift in customer purchasing behavior was a major reason why businesses needed to develop their strategies. The modified consumer behavior was the outcome of actions taken by the Greek government and the Public Health Agency to avoid the spread of the virus such as social distancing, travel bans, and closed borders.