New venture risk management: Theoretical framework and research perspectives

Managing risk is crucial for start-ups, which often struggle due to their small size, newness, and fast-paced growth. This study highlights strategies to address these issues, focusing on practical solutions. Building early financial reserves, like emergency funds or access to credit lines, can reduce the impact of unexpected setbacks. Start-ups should implement clear risk management protocols, including market research, to validate product–market fit before launching. Rigorous product testing ensures customer needs are met and regulatory compliance is achieved, minimizing costly mistakes. Flexible organizational structures, such as agile teams and adaptable processes, enable start-ups to respond quickly to market changes and growth demands. Long-term planning, such as scenario planning or creating contingency strategies, is essential to sustain growth. This research offers actionable guidance for founders, emphasizing lean, targeted risk management to optimize resources. Policy makers can use these insights to support start-ups through programs that reduce barriers, provide mentorship, and offer financial safety nets, boosting overall success rates and resilience in dynamic market conditions.