Innovation-driven entrepreneurship: Challenges and barriers to startup growth

Abstract

The paper examines the systemic factors that influence the scalability and sustainability of innovation-oriented startups in contemporary economies. Drawing upon recent statistical data from the Flash Eurobarometer and comparative analyses of public policies for startups in the EU and emerging economies, the study investigates the structural, institutional, and financial barriers that limit entrepreneurial growth. The research identifies key determinants of startup competitiveness, including access to finance, the quality of human capital, digital infrastructure, and institutional support, and highlights significant disparities between EU member states and smaller non-EU economies. Special attention is given to the Republic of Moldova, whose startup ecosystem is represented internationally through Startup Moldova and characterised by promising digital potential yet persistent constraints in funding, innovation infrastructure, and talent retention. Empirical evidence suggests that innovation-driven entrepreneurship is a catalyst for economic growth, contributing to technological diffusion, job creation, and regional competitiveness. However, the findings underscore that the effectiveness of startup development policies depends not merely on lowering entry barriers, but on fostering conditions conducive to long-term scalability, integration of R&D ecosystems, cross-sector collaboration, and strategic internationalisation. The paper concludes that a comprehensive policy approach combining financial instruments, institutional reforms, and innovation-driven education is essential to enhance the resilience of startup ecosystems, particularly in small and emerging economies.