Business model design and performance in nascent markets

Abstract

Purpose The purpose of this paper is to investigate the nascent market settings from a business model innovation perspective with the research questions: How do incumbents and start-ups make sense of an emerging technology through business model design in a nascent market setting, and how does business model choice influence firm performance? Design/methodology/approach The authors have tracked the development of four case companies in the nascent electric vehicle market from 2009 to 2018 and have conducted interviews and analyzed the archival data. Findings The authors propose a typology of business model choices and performance where the four types of business models distinguish themselves by how the companies innovate or imitate the value proposition of the current industry as well as how they innovate or imitate the business model archetype. In accordance with these different business model choices, the actors express different logics behind their new to the product market space business model choice. These logics represent different understandings of technology potential, customer needs as well as potential for value capture and contribute to and limit the translation of emerging technologies into dominant designs in diverse ways. Originality/value The business model is conceived as a focusing device that can be used to identify market applications for emerging technologies. As new disruptive technologies often require a new to the product market space business model, literature has in recent years put a premium on business model innovation. However, the linkages between emergent technologies and the choice of a novel business model are under investigated especially in relation to how business model choice affects business performance in nascent market settings. This paper aims at filling this gap.

Translational mechanisms in business model design: introducing the continuous validation framework

“…Third, we integrate previous studies on business model design (e.g. Zott and Amit, 2010; Rask and Günzel-Jensen, 2019) by introducing a novel framework that underlines extensively the role of idea validation and iteration to improve alignment and collaboration between different stakeholders. Extensive idea validation and iteration through the steps proposed in the CVF help address recent critiques of the LS methodology related, among others, to inadequate guidance about how to generate hypotheses for experimentation (Felin et al , 2019).…”

“…This paper contributes to the entrepreneurship and innovation literature in three ways. First, we contribute to the growing literature on business model design (Zott and Amit, 2010; Rask and Günzel-Jensen, 2019) by placing emphasis on design as an important antecedent of developing effective business models. Second, we put forward the idea that business model design encompasses useful mechanisms for entrepreneurs wishing to translate complex concepts related to their start-up (e.g.…”

Leveraging the value from digitalization: a business model exploration of new technology-based firms in vertical farming

“…It is therefore pertinent to explore how manufacturers manage efficiency and novelty when innovating their business models to fully leverage the benefits offered by digitalization (Metallo et al, 2018;Horv ath and Szab o, 2019;M€ uller, 2019;M€ uller et al, 2018;Rachinger et al, 2019). This is especially the case when considering NTBFs that are uniquely positioned to benefit from it (Sabatier et al, 2012;Rask and G€ unzel-Jensen, 2019;Autio et al, 2018).…”

“…Despite being recognized as an important element in the transition to Industry 4.0, the ways in which firms across the industrial spectrum leverage digitalization in their business models remains unclear (Buer et al, 2021;Montes and Olleros, 2020;Holzmann et al, 2020b;Rask and G€ unzel-Jensen, 2019;M€ uller, 2019;M€ uller et al, 2018;Rachinger et al, 2019). Achieving a better understanding of how firms leverage digitalization in their business models is a critical question in digital transformation (Del Giudice et al, 2021).…”

Cluster Typology of Business Models of Start-Ups. (Example of Slovakia)

“…According to Wirtz (2019), there are four types of B2C business models: focusing on content, commerce, context and connection. Another theory (Rask and Franziska 2019) proposed a two x two typology of business model choices and performance where the four types of business models distinguish themselves by how the companies innovate or imitate the value proposition of the current industry as well as how they innovate or imitate the business model archetype: The Infrastructure start-up, The Manufacturer start-up, The Incumbent Manufacturer and The Infrastructure Incumbent.…”