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 63 

 

                       FINANCE AND BANKING 

                                                                  IJFB VOL 13 NO 1 (2023) P-ISSN 2574-6081  E-ISSN 2574-609X 
                                                  

        Available online at https://www.cribfb.com 

                                                                                                                                           Journal homepage: https://www.cribfb.com/journal/index.php/ijfb 
                                                                                                                                                                                                   Published by CRIBFB, USA 

STARTUP SUSTAINABILITY BASED ON GOVERNMENT, 

TECHNOLOGY, AND MARKET: EMPIRICAL STUDY MEDIATION 

OF PERFORMANCE & SATISFACTION                                  

          
 Shivani Shivhare (a)1   Nupur (b)    V Shunmugasundaram (c)    

 

(a) Junior Research Fellow, Faculty of Commerce, Banaras Hindu University, Varanasi, Uttar Pradesh, India; E-mail: shivanihare38@bhu.ac.in 
(b) Senior Research Fellow, Faculty of Commerce, Banaras Hindu University, Varanasi, Uttar Pradesh, India; E-mail: kuharnupur9404@bhu.ac.in 
(c) Professor, Faculty of Commerce, Banaras Hindu University, Varanasi, Uttar Pradesh, India; E-mail: sundaram@bhu.ac.in 

 

 
A R T I C L E I N F O 
 

 

Article History: 
 

Received: 1st January 2023 

Revised: 19th February 2023 

Accepted: 20th February 2023 

Published: 28th February 2023 

 
Keywords: 

 

Startups, Sustainability, Satisfaction,  

Performance, Market Orientation,  

Government Support, Technology,  

Incubators 
 
JEL Classification Codes: 

  

E20 

 
 

  

 
A B S T R A C T 
 
Start-ups are one of the driving forces of growth and development for developed economies, although 

emerging economies are now striving to encourage start-ups for the advancement of the country with 

the support of the startup ecosystem. However, 90 percent of the start-ups failed within a year of their 

establishment. This study focuses on the factor affecting the sustainability of start-ups, and it is based 

on primary data collected from 384 start-ups in India. This empirical study analyzed, whether factors 

such as government support, market orientation, and technology orientation, affected the sustainability 

of the start-ups by using entrepreneurial satisfaction and performance of the start-ups as the mediators. 

Correspondingly, the study analyzes the mediation effect of entrepreneurial satisfaction between 

performance and startup sustainability. The results conveyed that government support, and technology 

affected startup business sustainability by fostering startup enterprise performance and entrepreneurial 

satisfaction, while market orientation does not mediate business sustainability using startup enterprise 

performance as the mediator, and technology orientation affected startup business sustainability with 

entrepreneurial satisfaction as the mediator. 

 
 

© 2023 by the authors. Licensee CRIBFB, USA. This article is an open-access article distributed 

under the terms and conditions of the Creative Commons Attribution (CC BY) license 

(http://creativecommons.org/licenses/by/4.0/).                           

 

INTRODUCTION 

Entrepreneurship has grown as a popular domain of research by both corporates as well as academicians, there are multiple 

articles available to describe entrepreneurs’ behaviours (Blackburn & Kovalainen, 2009; Wadhwa et al., 2011). But the 

present scenario focused on resource-based theories, entrepreneurial satisfaction innovation, and sustainable development 

of entrepreneurship unlike the past studies were focused on demand and supply, production, entrepreneurs’ characteristics, 

etc. (Weidinger et al., 2014). “Without sustainable organizations, there is no sustainable development, thus, no future.”. In 

the modern world, the resource-based theory is combined with the sustainability theory to move entrepreneurship toward 

sustainable development. According to the sustainability theory proposed by Professor Tim Waring, entrepreneurs must act 

to overlook the environment and society’s welfare besides just economic profit (Waring et al., 2015). 

A startup is the basic step of any entrepreneurship initiatives. It is an early-stage avenue for employment and 

innovation (Salamzadeh & Kawamorita Kesm, 2017). The startup has paramount importance in improving environments 

and society, which involves critical business activity for existence and growth (Silva et al., 2021). Lean startups and business 

models in startups are burning topics in entrepreneurship literature (Ghezzi, 2019; Kountur et al., 2020; Lizarelli et al., 2022) 

(Slávik et al., 2021). 

                                                      
1Corresponding Author: ORCID ID: 0000-0002-1576-034X 
© 2023 by the authors. Hosting by CRIBFB. Peer review under responsibility of CRIBFB, USA.  

https://doi.org/10.46281/ijfb.v13i1.1976 

 
To cite this article: Shivhare, S., ., N., & Shunmugasundaram, V. (2023). STARTUP SUSTAINABILITY BASED ON GOVERNMENT, TECHNOLOGY, 

AND MARKET: EMPIRICAL STUDY MEDIATION OF PERFORMANCE & SATISFACTION. Indian Journal of Finance and Banking, 13(1), 63-77. 

https://doi.org/10.46281/ijfb.v13i1.1976 

https://orcid.org/0000-0002-1576-034X
http://creativecommons.org/licenses/by/4.0/)
http://creativecommons.org/licenses/by/4.0/)
https://doi.org/10.46281/ijfb.v13i1.1976
https://orcid.org/0000-0003-0748-5904
https://orcid.org/0000-0003-0336-8073


Shivhare et al., Indian Journal of Finance and Banking 13(1) (2023), 63-77 

 

64 

Startups’ ecosystem growth is visible in the past few years in India (Singh et al., 2020). India’s startup ecosystem 

steered growth and development and has become the third largest startup ecosystem after the US and China (Basu & Virick, 

2015). India is still a growing economy with an abundance of large populations, and skilled and cheap labor (Sivathanu & 

Pillai, 2020). However, a large population has more demands but, due to limited resources availability resource available, 

alternative and substitute solutions can ease the market entry of startups in the Indian market (Scillitoe & Birasnav, 2022). 

Indian startup ventures fail to ensure sustainability criteria due to various reasons. The survey conducted by IBM and oxford 

economics displayed that around 90 percent of startups failed within the first five years of their establishment in India (Negi, 

2021). And, 77 percent of venture capitalists stated that, the lack of technology is the major cause of this failure (Demming 

et al., 2017). But recently technological startup entrepreneurship got momentum in India with around a 10 percent annual 

growth rate (Sivathanu & Pillai, 2020). Technology advancement develops the technological capabilities of the firm to get 

competitive advantages and to improve financial performance (Rezaee, 2016). Other than technology market orientation 

plays a crucial role in the performance and overall sustainable development of the firm (Ismail, 2022). Customer attracts to 

firms that have sustainability market strategies to incorporate economic, social, and environmental sustainability (Sivathanu 

& Pillai, 2020). Sustainable development in industries has become a comprehensive strategy to guide the world’s social and 

economic transformation while pursuing business activities (Shi et al., 2019). Startups are found to be uncertain regarding 

the acceptability of products or services in the market and disclosing their performance, but the performance and 

sustainability are inclined by the economic and environmental conditions of the operation area (Costa et al., 2022). 

Further, this study adds dimension to the analysis, explicitly sustainable entrepreneurship along with the emphasis 

on the need for business satisfaction & sustainability of startups (Murphy & Callaway, 2004), it empirically analyses the 

effect of attributes such as government support, market orientation, and technology orientation on business sustainability 

through the performance of startups and entrepreneurs’ satisfaction. The accelerator program initiated by the government 

helps startups to facilitate performance in startups (Polo García-Ochoa et al., 2020). There is a need to study internal and 

external factors that can impact the relationship between two variables (Caseiro & Coelho, 2018), because internal factor 

has a profound impact on understanding the performance indicator in startups (Behl, 2022; Furtado et al., 2017). Thereby, 

this study analyses the key factors to steer startups' business sustainability and survival. In this aspect, a theoretical model 

was prepared based on (Lee & Kim, 2019) and empirical analyses were made on 384 samples. 

The research Objectives of the study are as follows: 

 To develop a theoretical framework for linking GS, TOR, MOR, SEP, ES, and SBS in the context of Indian start-

ups. 

 To evaluate the mediation effect of SEP and EG between GS and SBS on the startups. 

 To assess the mediation effect of SEP and EG between TOR and SBS on the startups. 

 To measure the mediation effect of SEP and EG between MOR and SBS on the startups. 

 To determine the intervention effect of EG between SEP and SBS on the startups. 

 

LITERATURE REVIEW 

Starting a new firm has the objective to grow into a valuable firm to benefit society, through the creation of employment 

opportunities and innovations (Harlin & Berglund, 2021). India’s startup has experienced significant growth over the past 

years (Scillitoe & Birasnav, 2022). Startups have been seen as drivers of change and innovation (Palmié et al., 2021) A 

startup is defined as a temporary organization in search of working under a scalable, repeatable, and profitable business 

model (García-Gutiérrez & Martínez-Borreguero, 2016). According to DPIIT startup is defined as any firm not formed by 

reconstruction and mergers, as established less than 10 years ago, and has a turnover under 100 rupees crore shall be 

considered a startup (startupindia.gov.in). Startups exhibit the potential to enable the transition of local areas, and economies 

with progress, competitiveness, and industrial transformations through new technologies and innovations (Passaro et al., 

2020). Factors that are related to startup success such as customer value proposition, government schemes, marketing, 

technology, and operations affect the performance of the new venture (Eisenmann, 2020). The introduction of new products 

and technological innovation are of paramount importance in ensuring the success and growth of a business startup (Hazudin 

et al., 2015).  Some factors such as human resources, technological support, management system, relationship with 

government, finance, and marketing, were found to affect entrepreneurial satisfaction in e-commerce startups (Gide & Wu, 

2007). 

The need for sustainability along with profit must include social, ecological, and economic aspects has catalyzed 

the trend toward a paradigm shift in the business world (Sarango-Lalangui et al., 2018a). Sustainability encompasses both 

environmentally oriented and socially oriented practices, and rather than distinguishing between different types of 

sustainability goals, it is more general to pursue sustainability goals through corporate means. Sustainability 

entrepreneurship embodies the concept of shared value in business.  



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65 

Sustainability in financial performance is essential (Filser et al., 2019). A number of studies reported performance 

as the comparative indication based on economic and non-economic criteria, economic measures include sales, profitability, 

financial return, and turnover of the business (Inmyxai & Takahashi, 2011; Seo et al., 2018; Soeryo Prayogo et al., 2019). 

(Brush, 1992) Suggested future businesses should not measure the performance in growth terms, but also different ways 

such as the growth of skills, knowledge, and business satisfaction of the entrepreneurs. Moreover, (Bamgbade et al., 2022) 

have found the mediating role of organizational capacity and performance on business sustainability. This is essentially the 

creation of economic value, and being involved in it, also creates value for society (Reynolds et al., 2018). This study 

believes to address the research gap related to the experience of entrepreneurs of startups about stainability and performance 

of the business together, (Lauto et al., 2020)  specified the need of examining factors that can impact the entrepreneurial 

experience and decisions.  

 

Attributes of Startup (GS, MOR, TOR), and Startup Enterprise Performance (SEP) 

Start-up enterprise performance reflected in growth rate, sales growth, business stability, customer satisfaction, and 

entrepreneurial satisfaction (Rompho, 2018). Many studies explain that government support positively impacts 

entrepreneurship (Fonseca et al., 2018). Firms that received support from the government relatively survived for a longer 

period than the firms that did not get. Government support resulted in the greater performance of start-ups (Lee & Kim, 

2019). Market orientation is the process that emphasizes not only customer satisfaction but also other functional areas of 

the organization (Eric et al., 2017.). "A market orientation appears to provide a unifying focus for the efforts and projects 

of individuals and departments within the organization" (Kohli & Jaworski, 1990.) Market orientation includes the external 

environment to measure the competitive business environment of the firm, it is a culture placed focused on customer needs 

or satisfaction along with watching the capabilities of the competitor (Pelham, 1999). Several studies show a positive direct 

relation between MOR and performance. MOR is associated with superior performance in the form of profitability, sales 

growth, and new product development (Mastorakis et al., 2020.). Some studies emphasized that a business can only grow if 

it can maintain market orientation in an external business environment with severe dynamics where the customer’s demands 

are diversified and subdivided (Lee & Kim, 2019). 

Technology orientations are often understood as collecting resources and formulating strategies to avail 

opportunities with the technical system, it shows an organization’s devotion to research and development, accepting and 

applying the latest technologies to meet customers’ needs (Sala et al., 2022). The technology orientation refers to a set of 

organizational decisions regarding the aggressive use of technology position, Process innovation and automation, and new 

product development. Technology innovation is deemed an important enabler of perceived performance and sustainable 

development through business activities (Soeryo Prayogo et al., 2019)(D’Amato et al., 2020). 

 

Hypothesis 1. (H1) Government support for start-ups will positively affect startup enterprise performance. 

Hypothesis 2. (H2) The market orientation of start-ups will positively affect startup enterprise performance. 

Hypothesis 3. (H3) The technology orientation of start-ups will positively affect the startup enterprise performance 

 

Attributes of Startup (GS, MOR, TOR), and Entrepreneurial Satisfaction (ES) 

MOR has a mediating role in the performance and entrepreneurial orientation of startups   (Ruzgar et al., 2014). Also, the 

higher government supports enhance higher satisfaction among entrepreneurs. Government certification is important for 

startups indicating that a government-funded program of research and development is directly associated with the quality 

performance of the firm (L. Li et al., 2019). In general, “satisfaction” in business management is a variable used for customer 

satisfaction and is measured as a non-financial performance of consumer products and corporate brands. However, 

satisfaction with business can be considered in terms of companies rather than consumers, where financial and non-financial 

performance can be considered. Entrepreneurial satisfaction is a scale that measures the overall satisfaction that a business 

owner obtains while accomplishing its requirements and expectations from the business (Seco Matos & Amaral, 2017). 

Entrepreneurs should be asked how satisfied they are with their performance and business doing (Kerr, 2017).  Since, it is 

difficult to estimate the quantitative indicators necessary in measuring the company’s performance in the initial stages of a 

start-up, objective performances such as the sales and earnings rate, or subjective performances such as the expected 

achievement and satisfaction are measured. Moreover, (Chakraborty et al., 2019) stated that non-financial satisfaction is 

related to markets, technologies, and human resources after business start-up as entrepreneurial satisfaction. The concept of 

entrepreneurial satisfaction is a subjective feeling about the business field in which entrepreneurs started their businesses, 

and satisfaction is the state of being that is contentment without deficiency (Cooper & Artz, 1995). Thus, entrepreneurial 

satisfaction can be measured by non-financial factors such as the pleasantness of business operation, enthusiasm about 

business, sense of achievement in business, and attainment of sustainable development. 

 



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66 

Hypothesis 4. (H4) The government support for start-ups will positively affect entrepreneurial satisfaction. 

Hypothesis 5. (H5) The market orientation will positively affect the entrepreneurial satisfaction of startupreneurs. 

Hypothesis 6. (H6) The technology orientation will positively affect the entrepreneurial satisfaction of startupreneurs. 

 

Mediation and Significance in Business Research 

The mediation effect measures the causal relationship between two variables in the presence of the third variable called as 

mediating variable (Demming et al., 2017; MacKinnon, 2001; MacKinnon et al., 2007). A mediating variable can totally or 

partially transmit the impact of the antecedent on the result (Aguinis et al., 2017). According to (Namazi & Namazi, 2016)   

in the mediation process “the independent variable first influences the mediator variable, and then the mediator influences 

the dependent variable”. Several researcher has used mediation analysis in the field of business and management and 

mediating variable were R&D, innovations, performance, customer engagement, business models, corporate culture, etc. 

(Chen, 2022; Ferreras-Méndez et al., 2021; Garg et al., 2020; Zhao et al., 2022). Mediation is a statistical technique to 

examine whether the impact of (X → Y) where causal variable ‘X’ and outcome variable ‘Y’ is at least partly explained 

through a series of impacts of the ‘X’ on an intermediating variable Z and then on the intermediating variable on the ‘Y’ 

(i.e., X → Z → Y) (Fiedler et al., 2011). 

 

Mediation Process  

Start-up Enterprise Performance (SEP) and Entrepreneurial satisfaction (ES) as Mediators 

Start-up enterprise performance can be used as synonymous with business performance, operational performance, business 

growth, etc. The study (Haryono & Paminto, 2015,) explains the mediating effect of performance on the relationship 

between corporate value and financial risk, and performance revealed a positive relationship between corporate value and 

financial risk. Also, it was identified (Wahba & Elsayed, 2015) that the financial performance of the firm positively mediated 

the relationship between ownership structure dimensions and corporate social responsibility. Most of the research are 

concerned with the mediation effect of a firm’s performance in the sector of finance (Al-Slehat, 2020). The authors (Namazi 

& Namazi, 2016) highlighted a framework to use performance as the mediator between CSR and stakeholder perception.  

Moreover, some studies have emphasized the role of financial performance as a mediator between the size of the firms and 

corporate value or corporate governance, and on capital structure and corporate value as well as risk on the value of the firm 

(Al-Slehat, 2020; Author et al., 2014; Haryono & Paminto, 2015).     

The study carried by (Lee & Kim, 2019; Zhao et al., 2022) used the satisfaction of entrepreneurs and performance 

as a mediating variable in the analysis of environment and sustainability through entrepreneurial activities. (Iskamto & 

Ghazali, 2021) has examined mediation analysis through the satisfaction and performance of MSEs. Hmieleski and Corbett 

(2008) presented interaction effect on self-efficacy and entrepreneur’s satisfaction of startups. Nonetheless, the empirical 

findings of (Lauto et al., 2020) also suggested the relationship between economic performance and the satisfaction of 

entrepreneurs.  

 

Startup Enterprise Performance (SEP), Entrepreneurial Satisfaction (ES), and Startup Business Sustainability (SBS) 

Among the various business studies, most studies measure effectiveness and efficiency of startup by a focus on the financial 

performance of business operations (Seo et al., 2018), but now there is more stress on the importance of non-financial 

performance or intangible assets based on the current environment uncertainty (Hoque, 2005). For start-ups and SMEs, 

business sustainability practice is a critical factor that must be considered, along with performance (Sarango-Lalangui et al., 

2018). The theory of sustainability states that the sustainable development of the organization mainly depends on the goals 

and objectives of the organization and sustainable organizations can operate consistently and stably despite various 

difficulties in the market   (Shi et al., 2019). Sustainability needs should emphasize sustained natural resources, sustained 

technology, sustained employment, and sustained performance of the firm (Sha, 2022).   Good doing of the enterprise and 

entrepreneur’s caliber in the process of business start-up may serve as a key variable in the sustainability of entrepreneurial 

intention and behaviors (Harlin & Berglund, 2021; Tur-Porcar et al., 2018). The intention to sustain a business can be related 

to positive attitudes among entrepreneurs, which makes them more satisfied with their business. 

As mentioned above, satisfaction immerses the best emotions, the ultimate pleasant experiences, and a happy 

mental state of the entrepreneurs that are encouraged by enterprise well performance thus, they both are critical success 

factors of sustainable development of entrepreneurship and society (Eriksson Muyu Li Supervisor et al., 2012). Moreover, 

(Lee & Kim, 2019) argued that entrepreneurial satisfaction can be related to non-financial factors such as the congenial 

environment of business operation, enthusiasm about business, sense of achievement in business, and attainment of business 

stability (Gupta & Muita, 2012). Accordingly, this study provides the following hypothesis that is based on startup 

performance and satisfaction with the motivation of bringing sustainability to new ventures. 

 



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67 

Hypothesis 8. (H8) The startup enterprise performance of start-ups will have a positive effect on startup business 

sustainability. 

Hypothesis 9. (H9) The entrepreneurial satisfaction of start-ups will positively affect startup business sustainability. 

 

MATERIALS AND METHODS 

This study examines the key attributes to promote the business sustainability of nascent venture and startup to convert the 

short survival rates into long-sustained startup firm, factors such as market orientation, technology orientation, and 

government support are taken as the causal variable to empirically verify the effect on start-up performance, entrepreneurial 

satisfaction, and business sustainability. Accordingly, this study surveyed Indian start-ups to verify the effects of 

government support, market orientation, and technological advancement on the sustainable development of 

entrepreneurship, and the startup performance and entrepreneurial satisfaction as mediators bring novelty in the field of 

sustainable entrepreneurship. The research model as shown in figure 1 is designed with the research hypotheses provided 

based on the literature review. 

 

 

 

 

 
Figure 1.  Research Model 

Source: Authors’ compilation 

 

Variables and Analytical Approach 

Based on an extensive literature review on business, startups, and entrepreneurship, the research instrument for this study 

was developed. The measurement scale for entrepreneurial satisfaction was adopted from the literature for technological, 

government support, market orientation, financial and non-financial performance, satisfaction and motivation of 

entrepreneurship, and other relevant area presented in table 1. 

 

Table 1. Variables and Operational Definition 

 
Variables Factor Definition Items Reference 

 

 

 

 

 

Independent Variable 

Government Support 
(GS) 

The support from the government has benefitted 
start-ups  

3 (Joanne L. 
Scillitoes 2021) 

(Hazudin et al., 

2015) 

Market Orientation 

(MOR) 

The attitudes and strategies of satisfying 

customer need, competitiveness, and acquiring 

market knowledge for achieving customer 
satisfaction 

3 (O ´ 

Scar 2007)    

(Mastorakis et al., 
2020.) 

Technology 

Orientation (TOR) 

The technology support availed by the start-ups 

for ease of their business activities 

4 (Zahra and Covin, 

1993.) 

(Deshpande et al 
2013) (Urban & 

Heydenrych, 2015) 
(Bamgbade et al., 

2022) 

 

 

 

 

Parameter/ Mediator 

Startup Enterprise 

Performance (SEP) 

The financial performance of the start-ups 

acquired by their operation 

4 (Sivathanu & Pillai, 

2020) (Rompho, 
2018) (Zahra and 

Covin, 1993) 

Entrepreneurial 

Satisfaction (ES) 

Satisfaction with business activities and 

acknowledgment of doing something owned by 
the entrepreneur regarding start-up activities. 

7  (Seco Matos & 

Amaral, 2017; St-
Jean & Mathieu, 

2015) 

Government Support 

Market Orientation 

Technology 

Orientation 

Business 

Sustainability in 

Startup 
Entrepreneurial 

Satisfaction 

Startup Enterprise 

Performance  



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68 

 

Dependent Variable 

Startup Business 

Sustainability (SBS) 

The possibility is that the business activities of 

start-ups are enough to sustain business 

economically, socially, and environmentally in 
the long run. 

8 (Karani 2021) 

(Sarango-Lalangui 

et al., 2018a) 

Source: Literature 

 

Sampling and Data Collection 

This research follows quantitative methodology with the use of primary data collected through the questionnaire, the data 

was collected from more than 400 startups operating in Madhya Pradesh, India. The sample was considered using the 

stratified random sampling technique and the key respondent of the questionnaire survey were owners/founders, partners, 

executives, and other key persons of the startups. The data was collected from the respondents through surveyed by visiting 

their work areas or offices and gathering all the details about technology and digitalization, government support through 

policies and programs for startups, startup perceived performance, market and market difficulties, satisfaction level through 

entrepreneurship and practice of business sustainability, questions was explained to the respondents and their confidentiality 

and annoying reassured. The sample size of 384 was calculated by using Cochran’s formula of indefinite population and a 

startup the total revenue for startups must be under Rs. 25 crores, situated in India as prescribed by DPIIT, GOI was used 

as the eligibility criteria for the selection of startup.  

 

Instrument/ Scale Used 

All the variables were measured by using the 5 Likert scales. The independent variables were measured using the scale 

representing strongly disagree=1, Disagree=2, Neutral=3, Agree=4, and strongly agree=5. The startup firm’s performance 

was represented as extremely declined=1, Declined=2, Average=3, Improved=4, and extremely improved=5.  

 

Analysis of Reliability and Validity 

A pilot study was conducted to inspect the validity and reliability of the questionnaire before collecting the final data. The 

reliability of the model was tested and the result has shown as .917 which should be more than the required value of 0.7 to 

get the reliability of the instrument.  

To ensure the reliability and validity of the research model, the constructs of this study were analyzed by using 

exploratory analysis as the result is presented in Table 2. 

The result of the standard loading value when scored 0.6 or more, can be used as a latent variable. All the constructs 

of this study scored more than 0.6 or more. The composite reliability of all the constructs should be close to or more than 

0.7, as all constructs of this study score 0.9 or higher thus, meet the standard set by (Bhattacharya et al., 1998) and (J. J. Li 

& Zhou, 2010). The AVE should be 0.5 or more as the standard set by (Frare & Beuren, 2021), and all the constructs in this 

study scored AVE more than 0.8 (See Table 2). Thus, ensuring the validity of this study model. 

 

Table 2. Results of reliability and convergent validity test 

  
Factor Loading Cronbach’s Alpha rho_A Composite Reliability Average Variance Extracted 

(AVE) 

ES 0.898 0.947 0.948 0.96 0.826 

0.882 

0.924 

0.919 

0.921 

GS 0.901 0.923 0.924 0.952 0.868 

0.958 

0.935 

MOR 0.929 0.92 0.923 0.95 0.863 

0.947 

0.911 

0.901 

0.898 

0.917 

0.935 

0.909 

SEP_ 0.961 0.934 0.941 0.958 0.884 

0.957 

0.901 

TOR_ 0.927 0.909 0.909 0.943 0.846 

0.912 

0.92 

Source:  Compiled from primary data using PLS-SEM 

 

Discriminant validity 

The off-diagonal values (see Table 3) show the correlation between the latent constructs. The discriminant validity is verified 

by comparing the inter-correlations of the constructs with AVE, as displayed (see Table 3). As the shared variance values 



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69 

were lower than the corresponding AVE, discriminant validity between the constructs in the study was proved as per  (Ab 

Hamid et al., 2017) the required criteria. 

 

Table 3. Correlation matrix and average variance extracted (AVE) 

  
ES GS MOR SBS SEP_ TOR_ 

ES 0.909 
     

GS 0.378 0.932 
    

MOR 0.372 0.558 0.929 
   

SBS 0.667 0.402 0.459 0.912 
  

SEP_ 0.626 0.395 0.367 0.465 0.94 
 

TOR_ 0.403 0.469 0.657 0.466 0.409 0.92 

Note: The numbers in bold are AVE square root values of each variable. 

Source: Primary data 

 

Common Method Bias 
The single-factor Harmen test (Podsakoff et al., 2003) was conducted to check the existence of common method bias. The 

result was 40.082% which is less than 50%, justifying that there is no concern of common method bias for this study.  

 

RESULTS AND DISCUSSIONS 

Demographic Characteristics of the Respondents 

The survey results showed from the total of 384 respondents, 77.60 percent were male and 22.13 percent were female, in 

case of age concerned 12.8 percent of total less than 25 years, and 55.7 percent were aged between twenty-five to thirty -

five, 24.9 percent were between thirty-five to forty-five, and only 6.8 percent were older than forty-five years, that show 

more start-up entrepreneurs are in the age of twenty-five to thirty-five years. In case business ideas of current start-ups 

showed that seminars and conferences are the most idea-genic source has 26.6 percent of ideas came from there, the next 

vital source of start-up ideas are found to be friends and relatives as 14.6 percent of ideas came from there, and 13.5 percent 

were from newspapers, and 37.5 percent is from other sources. (Table 4). 

 

Table 4.  Demographic profile of respondents 

 
Category Frequency Percentage 

Ages Less than 25 49 12.8 

25 to 35 years 214 55.7 

35 to 45 years 95 24.7 

More than 45 26 6.8 

Total 384 100.0 

Gender Male 298 77.60 

Female 85 22.13 

Total 384 100.0 

Marital Status Unmarried 136 35.4 

Married 225 58.6 

Divorced 23 6.0 

Total 384 100.0 

Business Idea Newspaper 52 13.5 

Seminar/Conferences 102 26.6 

Bank/ Financial institutions 30 7.8 

Friends/ Relative 56 14.6 

Other 144 37.5 

Total 384 100.0 

Source: Compiled from primary data. 

 

Measurement Model 

The SmartPLS 3.0 software was applied for primary data analysis as many businesses used it for analyzing measurement 

models (Hwa et al., 2017). The measurement properties in the final model was calculated for the latent constructs, reflective 

and formative in nature having multiple indicators. There are two methods for structural equation analysis; one is covariance-

based and the other is partial least square based (Moqbel et al., 2020), and the study of (Sarstedt et al., 2020) (Carrión et al., 

2017) suggested the use of PLS-SEM for mediation analysis.  

 

Model Fit 

The standards for the goodness-of-fit index (GFI) of the revised model were verified to check the fit of the model.  The 

model is considered fit if the NFI will 0.9 or higher (Hwa et al., 2017). This model showed significant results, i.e., NFI = 

0.91, SRMR = 0.037, as per the standard set by (Hair et al., 2011)  (see Table 5). 

 

 



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Table 5. Model fit 

  
Saturated Model Estimated Model 

SRMR 0.037 0.073 

d_ULS 0.341 1.332 

d_G 0.442 0.465 

Chi-Square 1026.155 1097.575 

NFI 0.91 0.878 

Source:  Compiled from primary data by using PLS-SEM 

 

Table 6 has shown the results of the hypotheses tested showed that GS (T value = 3.423, β= 0.240) and TOR (T 

value = 2.787, β=0.253) had a positive and significant effect on SEP, but MOR have an insignificant effect (T value= 0.274, 

β= 0.067) on SEP. Thus, we fail to accept hypothesis two, but fail to reject hypotheses one & three.  

For the hypothesis four, the significant impact of GS on ES has been identified, with findings (T value = 3.448). 

Similarly, for the hypothesis five the impact of TOR on ES is positively significant (T value = 2.582), but hypothesis six 

was rejected due to the insignificant effect of MOR on ES.  

Moreover, the hypothesis seven was accepted as the result revealed a significant and positive impact of SEP on ES (T value 

= 9.744, β= 0.526). 

Finally, both the hypotheses eight and nine were accepted with a significant impact of SEP (T value = 4.462, 

β=0.334) and ES high impact (T value = 10.606, β= 0.618) SBS.  Further, table 6 also, shows MOR does not find a significant 

effect on SEP as well as ES, whereas GS had a greater effect on ES, and ES has a greater positively significant effect on 

SBS than SEP (see Table 6). 

 

Table 6. Results of the hypothesis test 

 
Hypothesis Channel Path Coefficient T value  Decision   R2 

Hypothesis 1(GS - SEP) 0.240 3.423 Accepted 0.223 

Hypothesis 2 (MOR - SEP) 0.067 0.274 Rejected 

Hypothesis 3 (TOR -SEP) 0.253 2.787 Accepted 

Hypothesis 4 (GS- ES) 0.375 3.448 Accepted 0.427 

Hypothesis 5 (MOR -ES) 0.061 0.548 Rejected 

Hypothesis 6 (TOR- ES) 0.215 2.582 Accepted 

Hypothesis 7 (SEP - ES) 0.526 9.744 Accepted 

Hypothesis 8 (SEP - SBS) 0.334 4.462 Accepted 0.449 

Hypothesis 9 (ES - SBS) 0.618 10.606 Accepted 

 Notes: t-values for two-tailed test: ***t-values 2.58 (sig. level = 1%), (Sivathanu & Pillai, 2020) 

 

 
 

Figure 3. SEM (structural equation model) analysis of the research model 
Source: Compiled from primary data 

 

 



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Mediation Effect 

We are concerned with evaluating whether the effects of the causal variables; GS, MOR, and TOR on SBS are mediated by 

ES and SEP. To examine the mediation effect of the ES and SEP through these pathways we used the SmartPLS algorithm. 

The result (see Table 7) revealed that the total effect of GS (β= 0.150) and TOR (β=0.169) on SBS was significant with the 

inclusion of mediating variables of SEP and ES, whereas, MOR has insignificant relation on SBS (β=0.037, T= 0.515) in 

presence of SEP and ES. 

The indirect effect of GS on SBS was significant (β= 0.053, T= 3.185, P=0.002) in presence of mediator ES. 

Additionally, GS also has a significant impact on SBS in presence of mediator SEP (β=0.019, T= 3.185, P=0.002). Further, 

the indirect effect of TOR on SBS was identified through ES as a mediator between them (β=0.067, T= 2.884, P= 0.004) it 

is more significant than the indirect effect of TOR on SBS through SEP (β=0.020, T=2.884, P=0.004). However, no 

significant indirect impact of MOR is found on SBS through both the mediators; ES and SEP. 

Table 7 also indicates, the impact of SEP on SBS through ES being a mediator, the result was significant with 

direct effect (β= 0.334), indirect effect (β= 0.325), and total effect (β= 0.659).  Moreover, the impact of ES on SBS was the  

significant direct and total effect (β=0.618), and the null indirect effect was assessed. 

 

Table 7. Results of Direct, Indirect, and Total effects 

 
Dependent variable Independent variables/ 

Mediator 
Direct Effect Indirect 

Effect 
 Total 

Effect 
T- value 

 

 

Startup Business 

Sustainability 

GS - 0.019 GS->SEP->SBS 0.150 3.185 

0.053 GS -> ES -> SBS 

MOR - 0.005 MOR->SEP->SBS 0.064 0.515 

0.037 MOR->ES->SBS 

TOR - 0.020 TOR->SEP- >SBS 0.169 2.884 

0.067 TOR->ES- >SBS 

SEP 0.334 0.325 SEP-> ES -> SBS 0.659  

ES 0.618   0.618 10.606 

Source:  Primary data collected through questionnaires analyzed using PLS-SEM 

Note: GS= Government support, MOR= Market orientation, TOR= Technology orientation, SEP= Start-up enterprise performance, ES= Entrepreneurial 
satisfaction, BSB= Start-up business sustainability 

 

DISCUSSIONS 
This study is conducted to empirically determine the factors affecting business sustainability and the survival rate of start-

ups, as recognized since global government support in an attempt to secure new growth engines and create jobs. The results 

of the data analysis showed that start-ups based on GS, and TOR had a positive effect on business sustainability through 

mediator’s startup enterprise performance (SEP) and entrepreneurial satisfaction (ES). The findings show that the 

government assistant program (GS) has a significant association with the performance of the start-up and were validated by 

the study of (Musa et al., 2017) which suggested a significant government role in the performance of nascent ventures. The 

findings of the present study indicate that technology orientation (TOR) has a significant impact on the performance of 

startups, with a similar result to the findings of (Holgersson & Granstrand, 2021) revealing the importance of technology 

such as patenting, digital innovations, R&D has a significant positive impact on the performance including cost reductions, 

productivity, sales growth. Ultimately, factors such as innovativeness, digitalization, and information symmetry of 

entrepreneurs had a positive impact on the performance of the start-ups as well as business sustainability.  

The previous empirical investigation of (Gibson et al., 2014; Gupta & Muita, 2012) is also revealed similar results 

that there is a positive significance in enterprise performance on the entrepreneurial satisfaction of startups. The development 

of technology significantly impacts on the satisfaction of entrepreneurs in nascent ventures this result is similar to the 

previous literature (Lee & Kim, 2019). Additionally, the government support has been identified as a significant factor in 

this study to foster business satisfaction among entrepreneurs of the start-up, this result is consistent with (Reddick & Roy, 

2013; Sharma et al., 2021) that show government support including development programs, websites, and e-portal, etc. are 

boost the satisfaction of the startupreneurs.  

Caseiro and Coelho (2018) stated that GS has unique competitiveness in start-ups that are difficult to imitate, thus 

entrepreneurship can serve as a critical factor in terms of mid/long-term growth and sustainable development for start-ups. 

On the other hand, market orientation positively impacted business sustainability with startup enterprise performance as the 

mediator, but not on entrepreneurial satisfaction.  

Previous studies on startups stated that start-up sustainability is affected by variables such as the entrepreneur’s 

satisfaction and the start-up ecosystem consisting of government and society and there is a positive association between 

satisfaction and sustainability in entrepreneurship of new ventures (Lee & Kim, 2019; Ziakis et al., 2022). 

The role of the performance of the startups is found significant to the sustainability of the business which can be 

validated by the study of (Deslatte et al., 2021; Lee & Kim, 2019). This shows that when the performance is a key factor of 



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72 

start-ups that connects with sustainable practices, it means if startup performed well, it motivates the entrepreneurs to 

implement sustainable business practices.  

It is observed from the study that market orientation is insignificant in obtaining satisfactory performance and 

satisfaction among startupreneurs, this finding is similar to the study of (Lee & Kim, 2019), A company must maintain its 

market orientation in the dynamic market environment for sustainable growth (Scillitoe & Birasnav, 2022). Accordingly, 

start-ups should encompass the marketing environment to analyze customer values and to adapt good market fit for ultimate 

sustainability (Ruzgar et al., 2014). Moreover, MOR positively impacted on business sustainability with entrepreneurial 

satisfaction as the mediator, which is contrary to (González-Benito et al., 2009; Huang, 2016). 

The present study is also identified that performance has a significant impact on sustainability through mediator satisfaction, 

this comprehensively indicates that performance brings satisfaction among entrepreneurs which motivates them to 

sustainable business practices (Deslatte et al., 2021). 

The study shows that business leads to entrepreneurial satisfaction and performance with aid of government, and 

technology with sustainability. Moreover, as mentioned, government and technological support are useful to perceive 

opportunities that will accelerate entrepreneurial success and sustainable business growth.   

 

CONCLUSIONS 
Based on the results, this study can provide inferences to set the direction for sustainable growth and development of start-

ups. First, as indicated by the results, startup performance is a key variable for the business sustainability of start-ups. 

Previous studies based on performance confirmed that it is only possible when it is supported by an entrepreneurial 

ecosystem. Furthermore, startup performance promotes the more explorative activities of start-ups and improves their 

capacity to implement sustainable ideas. Thus, entrepreneurs must immerse themselves in innovative ideas and sustain 

events to develop their capabilities. Accordingly, entrepreneurs can be satisfied in the early stages of a business when they 

focus on both financial and non-financial performance and entrepreneurial satisfaction. Moreover, the government support 

programs must be intended for safeguarding various challenges and obstacles of startups, and further technology should 

encompass entrepreneurship programs for start-ups to support at early-stage.   

Besides, start-ups have different environments and ecosystems depending on the business field, which is why more 

detailed research must be conducted when considering types of business such as manufacturing, IT, or service. Startups in 

the area of automobile and IT and fashion industries should adopt sustainable marketing strategies to enhance customer 

satisfaction (Ejovwokeoghene OGBARI et al., 2022; Jung et al., 2020). Correspondingly, the government should collaborate 

with startups (specifically with cleantech and energy) to increase the financial benefits of the startups. Technology 

advancement should be encompassed to reduce the information asymmetry, that not only benefits startups but all the 

participants of the industry (Kim et al., 2020). 

 

Limitations and Further Scope area 

The study has found a link between government, technology, and market support, along with the mediation effect of 

entrepreneurial satisfaction and startup performance on startup sustainability. It has many limitations that create 

opportunities for future research such as the survey of this study has geographic limitations as samples are collected from 

the startup of Madhya Pradesh, India, to generalize the results. In Addition to limitations, the data for the present study were 

collected in a one-time frame, longitudinal studies can be incorporated in the future. It is a quantitative analysis further 

studies may incorporate a qualitative method for a better understanding of entrepreneurial behaviours on sustainability.  

 

Implications 

This research is a theoretical background of sustainability in start-ups in the context of India to provide inclusive factors 

required for sustainability building in startups the proposed theoretical model validate empirically.   

This study serves academicians by contributing to the entrepreneurship domain by providing a research framework for 

business sustainability. This study contributes managerial implications to suggest strategic planning a scaling of the startup 

for sustainable growth, sustainability in business is not simple to attain and retain, and this research contributes to startup 

entrepreneurs developing healthy customer relations and better implementation of the start-up ecosystem for sustainable 

growth of the firm.  

From the perspective of government implications, this research suggests that the government should provide more 

training to entrepreneurs for sustainable practices, and there must be more involvement of the government in increasing the 

performance of start-up companies. And it will prove better if the government encourages marketing training and platforms, 

especially for start-ups.    

 

 
Author Contribution: Conceptualization, S.S., N. and S.V.; Methodology, S.S.; Software, S.S; Validation, S.S., N. and S.V.; Formal Analysis, S.S., N. 
and S.V.; Investigation, S.S., N. and S.V.; Resources, S.S., N. and S.V; Data Curation, S.S.; Writing – Original Draft Preparation, S.S., N. and S.V.; 

Writing – Review & Editing, S.S., N. and S.V.; Visualization S.S., N. and S.V.; Supervision, S.V.; Project Administration, S.S. and N.; Funding 

Acquisition, S.S., N. and S.V. Authors have read and agreed to the published version of the manuscript.    
Institutional Review Board Statement: Ethical review and approval were waived for this study, due to that the research does not deal with vulnerable 

groups or sensitive issues. 

Funding: Jawaharlal Nehru Memorial Fund, New Delhi for this research.  
Acknowledgments: Not applicable. 

Informed Consent Statement: Informed consent was obtained from all subjects involved in the study. 



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73 

Data Availability Statement: The data presented in this study are available on request from the corresponding author. The data are not publicly available 

due to restrictions. 

Conflict of Interest: The authors declare no conflict of interest.        

                                                                                                                                                                                                                            

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