AMAZON, AIRBNB, IKEA: WHO FAILED AND WON DURING THE COVID-19 PANDEMIC

The crisis processes in the world economy have not spared the start-up market either.  Many technology projects that were in trend have found themselves at the bottom as a result of the pandemic.

However, there are those for whom the established social restrictions and measures to prevent the development of a pandemic have become conditions for a rapid growth.  What companies have failed and what have won amid the Covid-19 pandemic?

The majority of experts agree that the start-up market has held out as a whole, but a significant part is still in the red.  First of all, due to a decrease in the volume of investments.

According to analysts' calculations, the first half of the year was marked by a 7% decline in investment activity.

The market capitalization of the most of companies has dropped significantly.  Half of the players have lost from 20 to 30% of the previous capitalization.  More than 30% of companies experienced a decline in revenues.

Many start-ups were forced to dismiss the  staff.  Someone did it very technologically, like, for example, a Bird scooter rental company.  Management simply invited over 400 employees to a conference at ZOOM, where a voice chatbot informed them of the layoff.  The Russian analogue of the service, SamokatShering, did it in a simpler way, having gone bankrupt in April.

Airbnb, a landmark start-up, known to almost every traveler in the world, was forced to lay off a quarter of its employees (about 1.9 thousand people), facing the prospect of a double decline in profitability in 2020.

As Brian Chesky, the head of the company noted, it is no longer possible to travel in the way we traveled before.  By the way, not only Airbnb felt the negative impact of the pandemic.  Almost all businesses, operating in the entertainment market or related to the provision of travel services, have been hit by the pandemic.

Abroad, many similar start-ups, such as Stay Alfred or TripActions, have suspended their activities.  The first was engaged in the selection of apartments in the United States for the provision of short-term rent.  The second helped with the business trips’ organization.  The company was threatened with bankruptcy, from which it was saved by the debt obligations in the amount of $ 125 million, attracted on the security of a future stake in a block of shares after the IPO.

The sad story of the British tech star-up OneWeb, which applied for the bankruptcy protection to the court of the US, became known back in March.

The company capable of providing the whole world with cheap and affordable mobile communications and having such giants as Airbus, Virgin, Coca-Cola, SoftBank among its investors, did not cope with financial obligations.

Who benefits from the pandemic?  According to the analysts, about 23.5% of investors working in the venture capital market have increased their profitability.  And these are not only giants like Amazon - the company not only supported its leader in the status of the richest person in the world, but also provided work for about 175 thousand people in the midst of the pandemic.

As the practice has shown, food delivery services, educational and medical start-ups unexpectedly turned out to be "on the top".

For example, IKEA chain, forced to close its malls, acquired a star-up measuring the furniture in an apartment through a mobile device.  The software, powered by Geomagical Labs technology, allows the buyers to create a 3D image of their apartment and then move new furniture to replace old furniture in the virtual space.

Who could have guessed that in mid-March Zoom will increase its capitalization by 40% in one week?  By the end of May, Zoom cost more than $ 50 billion, while at the beginning of 2020, its market value was estimated at less than $ 30 billion.

Food delivery services, which had been actively developing before, experienced several times growth during the crisis.