Innovation characteristics of high-growth startups: the Korean case startups

Abstract Efforts to overcome low growth traps are ongoing worldwide. As high-growth startups substantially contribute to the economy, it is critical to understand what allows startups to achieve high-growth. Previous research has generally focused on high-growth firms and there is a lack of understanding in the difference between high-growth and general startups, especially in terms of innovation. To address this gap, this study examines the innovation characteristics of high-growth startups by analyzing Korean Innovation Survey data with logit regression and decision tree models. Previous studies have shown that high-growth firms are associated with product innovation. We show that process innovation is the most critical factor in creating high growth in startups. This result extends the finding of previous literature that process innovation not only increases the survival rate of startups, but also has a significant effect on achieving high growth. These results suggest that process innovation should be considered important when exploring innovation strategies or designing support policies for startup growth.