To get to the top and remain there, businesses must constantly develop new capabilities as they leverage existing ones. Keeping both priorities in play is tricky in the best of times, which is why legacy companies of late have been increasingly outsourcing innovation to tech start-ups via partnerships or outright acquisitions, a trend that has generated tremendous value for start-ups and their investors. However, with economic activity now slowed to a crawl in many sectors, firms have increasingly shifted their focus to short-term survival considerations and longer-term innovation priorities have temporarily fallen by the wayside. One result is that start-ups have been hit especially hard. Interestingly, late-stage start-ups were more pessimistic than early-stage ones, despite experiencing less severe fundraising woes in the pandemic (see below). It may simply be that inexperience breeds an optimism that can survive initial encounters with adversity. Investors, too, do not appear to be thinking beyond the pandemic. Depending on the nature of their business, companies are either busy capitalizing on the market changes produced by the pandemic, or scrambling to adapt. This opportunistic approach may not hold true in other entrepreneurial ecosystems and may also vary as a function of the level of government support.  Read More >>