In business, high risk means high return. Enterprises accepting high risks earns higher profit. Every business operation is covered by insurance. Developing an insurance market for startups to replace government support policies in the future is the way out for businesses to face the future termination of government support policies.
Enterprises introduce products at the Start-up day.
Over 110 thousand businesses were established in 2016. Not all of them succeed in the first three to five years of operation. This is the promising market for startup businesses insurance. If all the newly established enterprises in 2016 buy insurance, there will be 110 thousand insurance contracts. By the year 2020, when the target of creating one million enterprises is fulfilled, these enterprises are a huge potential for the startup insurance service.
Insurance firms deemed this is a business opportunity that should not be missed. Investment startup funds including venture capital funds, angel investment funds, and entrepreneurial incubators all implied certain activities of start-up insurance. These funds have proven to be successful internationally, meaning that start-up insurance has the potential to be highly successful even in the highest risk business environment.
Immediately after identifying this market segment, insurance firms are approaching customers, thoroughly studying the market and then coming up with product suitable for startups. A safe insurance market for startups will become a driving force for business creation.
Risks related to start-ups are diversified which can be built into categories such as insufficient market information, lack of legal knowledge, financial and human resources, weak branding, as well as risks related to competition. Start-up insurance will ensure the efficiency of start-ups, making it easier for anyone to startup with the support from these professional services.
Assc. Prof. Dr. Vu Thuong Lang - Nguyen Tung