2026 State of the Industry Report from Make Startups Institute

5. SWOT Analysis: Threats

The threats identified in the responses reflect a field navigating real structural pressures, both from external economic conditions and from internal dynamics. Many ecosystems remain vulnerable to funding volatility, staff turnover, and broader macroeconomic shifts that can quickly destabilize support infrastructure. At the same time, rapid technological change, capital concentration, and geographic disparities risk widening gaps between founders and regions that have access to resources and those that do not. Respondents also raised concerns about internal challenges, including burnout, misaligned incentives, and the tendency to prioritize short-term metrics over long-term value creation. Together, these risks highlight the importance of strengthening the durability, coordination, and strategic focus of entrepreneurship support systems.

Threats word cloud
Threats word cloud

Fragile program infrastructure can unravel under turnover and short-term funding

The source material makes clear that many ecosystems remain one grant cycle or one staff departure away from instability. That makes continuity difficult for founders and weakens trust in the broader support environment.

Steven Justice, Launch Fayette
Steven Justice, Launch Fayette

Capital tightening and macroeconomic pressure remain persistent threats

Respondents describe more selective investors, rising costs of capital, scarce funding for intermediaries, and broader economic uncertainty. For undercapitalized founders and ESOs alike, that creates thinner margins for experimentation and slower recovery from mistakes.

Cameron Cushman, Red Sage Innovation
Cameron Cushman, Red Sage Innovation

AI introduces execution risk, concentration risk, and cyber risk

The opportunity side of AI is real, but respondents also warn against mistaking tools for strategy, overrelying on algorithmic decision-making, and ignoring cybersecurity, liability, and rapid market displacement.

Lloyd Reshard, Kukua Institute
Lloyd Reshard, Kukua Institute

Geographic concentration can leave talent and communities behind

Several responses warn about widening gaps between hubs and non-hubs, rural and urban regions, insiders and outsiders. Brain drain, weak local density, and the concentration of capital and opportunity in a few places threaten broader ecosystem health.

Sam Herskovitz, Boyd Innovation Center
Sam Herskovitz, Boyd Innovation Center

Short-termism can weaken the field from within

Respondents worry about metrics replacing value, hype replacing fundamentals, competition replacing coordination, and burnout eroding founder and practitioner endurance. The risk is not only external shock. It is internal misalignment.

Taylor Vignaroli, Wyoming Business Council
Taylor Vignaroli, Wyoming Business Council
Article Details

A summary of surveyed threats:

  1. Fragile program infrastructure can unravel under turnover and short-term funding
  2. Capital tightening and macroeconomic pressure remain persistent threats
  3. AI introduces execution risk, concentration risk, and cyber risk
  4. Geographic concentration can leave talent and communities behind
  5. Short-termism can weaken the field from within
Category 2026 State of the Industry Report
Curriculum all
Created 2026-03-11 18:01:55
Last Updated 2026-03-11 18:01:55
IMI Provider CofounderOS
Published Make Startups Institute
Make Startups Institute
Module Resources
No assigned files for this module.
Launch with Make Startups Institute

Make Startups Institute is using CofounderOS to help founders design, launch, and scale their businesses.

Financial aid and scholarship packages are available for most programs.

Keep Learning!

SWOT Analysis: Opportunities
Strategic priorities for ESOs