Does Higher Startup Intention Leads to Higher Growth Performance? An Analysis into Factors Impacting Growth Performance of Indian Startups

Abstract

Startup growth performance captures the process of going from a concept to scaling up operations, dealing with obstacles, and accomplishing major indicators of success. Resilience, adaptability, and strategic vision are necessary for the dynamic journey that is achieving startup growth performance. Entrepreneur’s startup intentions act as a beacon, influencing their strategic choices for business establishment. It establishes the standard for how the startup overcomes obstacles, evolves to the expectations of the market, and adapts its offerings which makes startup intentions a key factor for the growth performances of startups.  The current study examines the impact of startup intentions, expected returns and intention for equity usage on the growth performances of Indian startups using Partial least squares structural equation modelling (PLS-SEM). PLS-SEM can be used for handling complex models with numbers of variables and indicators, making predictions, and conducting exploratory research. In addition, PLS-SEM does not require assumptions related to normal distribution of data. The structural model assessment shows that startup intention (STARTUP_INT) and intention to use equity (INT_EQT) has positive significant association with growth performances (GWTH_PER). Moreover, intention to use equity was found to be significant mediator in startup intention and growth performance relationship. However, there was negative and significant correlation between expected return (EXP_RTN) and growth performance of startups. The findings have crucial implications for entrepreneurs and policy makers, which can enhance Indian startup ecosystem.