Houston voices

Here's what challenges — and opportunities — Houston startups are facing amid COVID-19

The pandemic has destroyed a good part of the startup ecosystem. Here's how it happened and how startups can pick up the pieces. Miguel Tovar/University of Houston

There are startups struggling to keep their heads above the deluge of a pandemic-induced depression.

Between 2016 and 2018, the global startup economy generated over $3 trillion — a far cry from today's economic value. Today, startups struggle to keep operations running during the pandemic. Web companies throughout Europe have lost close to 400 billion euros during the coronavirus pandemic. Chinese venture capital investing has dipped 50 percent compared to everyone else.

"Startups that are supported by venture capital funds are merely a small part of the startup ecosystem. Startups that don't have venture capital funding, which is the majority of them, stand to lose substantial money during this pandemic-caused shutdown," says Dane Stangler, a business writer for Forbes.

"All across the country, there are startups that, while they may not have hefty venture capital funding, are still significant to the ecosystem because of their job creation," he continues.

These startups face serious setbacks and are expected to see a giant decline of growth during this pandemic. Small businesses are already in a bind because of forced closures and rapidly waning sales.

Far-reaching effects

Startups supported by venture capital have far-reaching effects on the rest of the economy. These high-tech companies generate up to five jobs for every one job they directly create.

"That means that the inevitable economic bodyslam they're about to receive or have already received will be felt by almost every other facet of the job market," explains Stangler.

According to the Startup Genome report, the pandemic will damage startups that were in the process of raising capital and will likely kill the majority of them.

What can be done?

"Federal emergency support for small businesses is certainly the right play here. The deli down the street, the local mechanic, the mom and pop burger joint; they all need help right now," Stangler says.

Tech and science startups need help too — and many of which were in the middle of getting off the ground when the corona crisis crashed the economy.

"Pumping money into them right now is the best thing that can be done to help them in the now."

The low-interest rate climate that has helped boost venture funds has also pushed many startups to survive on debt. We'll have to come to terms with this for now.

"Market momentum isn't necessarily ideal for the time being. Moreover, the "reallocation" forces that you hear entrepreneurs mention a lot has been kiboshed for now," explains Stangler.

Startups struggling to put the pieces of their company back together might see a glimmer of hope on the horizon, though.

Hope is on the horizon

Recessions breed good businesses. Don't believe me? According to the Startup Genome report, over 50 billion dollar tech startups were created during the recession of 2007 to 2009. Fun fact: more than 50 percent of the companies on the Fortune 500 list to date were founded during a recession.

Sure, startups struggling during a national pandemic can paint a demoralizing picture. But there might be some good news peaking through the dark clouds. It's clear that venture capital funding is at a standstill right now. But it could mean that more startups will get funded when things return to somewhat-normal.

The Startup Genome report shows us that during the 2001 and 2009 recessions, the number of companies that were funded by venture capitalists exploded and fast. For example, in the four years after the 2009 recession, the number of venture capital deals spiked by 25 percent every year.

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This article originally appeared on the University of Houston's The Big Idea.

Rene Cantu, the author of this piece, is the writer and editor at UH Division of Research.

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Five research teams are studying space radiation's effect on human tissue. Photo via NASA/Josh Valcarcel

A Houston-based organization has named five research projects to advance the understanding of space radiation using human tissue. Two of the five projects are based in Houston.

The Translational Research Institute for Space Health, or TRISH, is based at Baylor College of Medicine and funds health research and tech for astronauts during space missions. The astronauts who are headed to the moon or further will be exposed to high Galactic Cosmic Radiation levels, and TRISH wants to learn more about the effects of GCR.

"With this solicitation, TRISH was looking for novel human-based approaches to understand better Galactic Cosmic Rays (GCR) hazards, in addition to safe and effective countermeasures," says Kristin Fabre, TRISH's chief scientist, in a news release. "More than that, we sought interdisciplinary teams of scientists to carry these ideas forward. These five projects embody TRISH's approach to cutting-edge science."

The five projects are:

  • Michael Weil, PhD, of Colorado State University, Colorado — Effects of chronic high LET radiation on the human heart
  • Gordana Vunjak-Novakovic, PhD of Columbia University, New York — Human multi-tissue platform to study effects of space radiation and countermeasures
  • Sharon Gerecht, PhD of Johns Hopkins University, Maryland — Using human stem-cell derived vascular, neural and cardiac 3D tissues to determine countermeasures for radiation
  • Sarah Blutt, PhD of Baylor College of Medicine, Texas — Use of Microbial Based Countermeasures to Mitigate Radiation Induced Intestinal Damage
  • Mirjana Maletic-Savatic, PhD of Baylor College of Medicine, Texas — Counteracting space radiation by targeting neurogenesis in a human brain organoid model

The researchers are tasked with simulating radiation exposure to human tissues in order to study new ways to protect astronauts from the radiation once in deep space. According to the release, the tissue and organ models will be derived from blood donated by the astronaut in order to provide him or her with customized protection that will reduce the risk to their health.

TRISH is funded by a partnership between NASA and Baylor College of Medicine, which also includes consortium partners Caltech and MIT. The organization is also a partner to NASA's Human Research Program.

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