Even though the global startup economy generates nearly $3 trillion in value, it is being severely impacted by the coronavirus pandemic. That’s according to the latest Global Startup Ecosystem Report from Startup Genome which claims that COVID-19 could prove a "mass extinction event" for startups. Even before the crisis struck, startups were facing fundamental challenges such as value being concentrated in a handful of cities, a lack of inclusion and tech giants like WeWork and Softbank faltering. The unexpected arrival of the pandemic has now resulted in a major slump in consumer demand and venture capital which have led to layoffs.
VC funding fell 20 percent worldwide in the first three months of 2020 while it plunged 50 percent in China. The report states that 72 percent of the world’s startups saw their revenue fall since the start of the crisis and the decline averaged 32 percent. 40 percent of all startups experienced a 40 percent fall in revenue or more while only 12 percent recorded significant growth. This infographic focuses on a selection of startup sectors worst impacted in the report with Travel & Tourism suffering a 70 percent fall in revenue. The automotive sector suffered a 43 percent decline and even though the tech sector has weathered the storm better, it has still suffered a noticeable financial impact. Social Media & Messaging startups saw their revenue decline 22 percent, Gaming fell by 19 percent and Blockchain & Crypto contracted 14 percent.