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How Perth startups are responding to COVID-19

Updated: Jun 24, 2020

by Georgia J. Hay, M.K. Ward, Sharon K. Parker

Most of us have probably heard the phrase “unprecedented times” almost daily during the COVID-19 pandemic. Individuals and organisations have had to make rapid, and often drastic, changes to cope with this incredibly devastating and, indeed, unprecedented event.

However, for many entrepreneurs, the process of creating and scaling a business involves incredible uncertainty and volatility during the best of times.

So what happened when these entrepreneurs were faced with the uncertainty and volatility of COVID-19? How have their businesses been affected, and how have entrepreneurs responded to these challenges?

Georgia Hay and M.K. Ward, Posdoctoral Research Fellows at the Centre for Transformative Work Design, sought to answer these questions. They conducted interviews with a group of 15 startup founders across a breadth of industries (e.g., technology, education, energy), business models, and business maturity levels.

“It’s like the quote from Bane, in that we were born in the darkness, moulded by it. As a founder, we solve problems and face crises daily,” said one founder.

Challenges and changes

What can we learn from founders facing the uncertainty of COVID and finding themselves equipped to tackle the challenges it has posed? What can we learn from founders who have been able to see, and act on, opportunities within these extreme changes (to survive, and sometimes even thrive)? Collectively, the interviews revealed a variety of stories and themes that pointed to some answers.

Founders who invested in the wellbeing of their employees – through well-designed, autonomous and supportive work structures (i.e., good work design) – found that their teams were particularly resilient during the challenges of COVID. Conversations about team restructuring or downsizing, although undoubtedly difficult, were conducted transparently and received with empathy and understanding. Checking in with team members, involving employees in strategic conversations, and providing flexibility to team members who worked from home was associated with greater morale during these uncertain times.

Contextual factors

Context has played an important role in shaping the specific situation that each founder faced. For example, in mobile technology , there has been a boost in demands such that workload has increased; whereas some aspects of the energy sector, and founders with clients in the food industry, saw demands drop to almost zero. COVID has also revealed – or amplified – vulnerabilities in business models, such as reliance on the US market or Chinese suppliers. Fundraising has been affected, existing ways of working have been challenged, and the constraint of no in-person interaction has revealed new efficiencies in business processes. Some founders have found that they may not need that regular meeting, and it may not be so important to customers to spend time with them in person before they buy.

The swings have been extreme at both ends, and entrepreneurs who invested in providing social support, autonomy, and feedback to their employees from day one have seen all of their employees rally, proactively, to keep the business alive.

Times of crisis, such as COVID, have a human impact through work, and we see processes playing out in dynamics of startups where entrepreneurs reap the benefits of having provided their employees with social support and autonomy from the start. The result is that as COVID challenges business as usual, the teams who have built good work design are more resilient and can proactively spot opportunities and capitalize on them. It is a journey, and good work design has paid off in entrepreneurs’ ability to strategize, survive, and thrive after COVID.

For further detail on how founders coped with these challenges and changes, and for specific examples, access the full report.

Read the West Australian article below featuring our study.

The West Ward Hay June 2020
Download PDF • 393KB

Stay tuned for our full analysis of the 50 founder interviews our team has conducted between December 2019 and May 2020.

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