Influential Factors Impacting Startup Innovation and Growth

Abstract

Businesses play a crucial role in every economy by generating employment opportunities and alleviating financial burdens for many households. However, despite the high number of startups launched, a significant proportion fails to survive. Various factors contribute to this trend, including environmental, social, technological, and political factors. Additionally, factors such as expertise in the startup domain, leadership capabilities, financial resources, and effective marketing and promotion strategies also significantly impact startup performance.

The aim of this research is to explore the factors influencing innovation in startups and identify elements that can enhance success in securing funding. Through the utilization of three distinct models - the pooled model, fixed effect model, and random model - and further analysis employing the Hausman test, certain findings have emerged. Notably, it has been revealed that financing plays a substantial role in driving innovation within startups.