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This study aims to explore the research on the entrepreneurial challenges faced by tourism startups, their impact on employee well-being, and suggests future directions for researchers and practitioners. We have conducted a systematic literature review of peer-reviewed journal articles indexed in the Scopus database using the preferred reporting items for systematic reviews and meta-analysis (PRISMA) guidelines, considering 26 relevant articles published in 15 peer-reviewed journals. The literature review indicates that the topics related to tourism startups have been increasingly explored and studied in both developed and emerging nations in the past decade (2014–2024). The findings of the study revealed that the major issues that tourism startups face are a lack of job security and financial stability, high competition, market fluctuations, gender disparities, integration barriers, lack of digital competency, and high demand for sustainable businesses. The review also provides the factors influencing the overall well-being of employees such as role strains, work-related stress, financial constraints, work-life conflict, migration, and lack of motivation. This study stands out as one of the limited works to systematically review the entrepreneurial challenges and employee well-being in the tourism industry.

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