Pivoting in innovative startups during the Covid-19 Pandemic

Innovation allows firms to test innovative methods or upgrade existing ones and explore alternative business opportunities by setting up new sectors and activities and exploiting new resources and competencies. Leveraging innovation is a critical factor in building, transforming and/or reconfiguring capabilities by dealing with external and internal challenges and vulnerability of the competitive environment. Many startups are using a model of innovation mainly problem-solving, changing their business models and generating new technological solutions aimed at satisfying new market demand during the Coronavirus Disease 2019 (COVID-19) global pandemic crisis. As a result, innovative startups could play a relevant role in the definition and implementation of rapid responses to the unprecedented exogenous shock. Indeed, being innovative is a prerequisite of being resilient, constantly tending to anticipate the threats, adapt the business model and exploit the potential of new technologies. In addition to this, Governments are issuing different measures to protect companies and startups affected by the COVID-19 crisis. The most effective are tax incentives, advantages supporting short-hour working, grants and special programs such as growth loans and co-investment schemes, not necessarily developed to address the COVID-19, but, in the same way, appropriate. Some pivots are intended as temporary changes while, in others, innovation is the opportunity to experiment with new value generation processes beyond the COVID 19 crisis. The paper intends to explore the importance of pivoting for innovative startups by providing a complete framework of different conceptualizations and research streams. Furthermore, it offers several propositions for future research. To achieve the previous objectives, the paper analyzes the state of the art of literature on pivoting in the different research fields and deepens, through exploratory analysis, the pivoting phenomenon in the context of innovative startups facing the COVID-19 pandemic. The results highlight trends and gaps in a research field not yet fully explored and identify evidence useful to understand the determinants of pivoting. Theoretical and managerial implications are discussed by underlining some insights for policymakers.