Digital Entrepreneurship: A Research Agenda on New Business Models for the Twenty-First Century

International Journal of Entrepreneurial Behavior & Research
Digital entrepreneurship: A research agenda on new business models for the
twenty-first century
Sascha Kraus, Carolin Palmer, Norbert Kailer, Friedrich Lukas Kallinger, Jonathan Spitzer,
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Sascha Kraus, Carolin Palmer, Norbert Kailer, Friedrich Lukas Kallinger, Jonathan Spitzer,
(2018) "Digital entrepreneurship: A research agenda on new business models for the twenty-first
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IJEBR-06-2018-0425
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Digital entrepreneurship
A research agenda on new business models
for the twenty-first century
Sascha Kraus
ESCE International Business School,
Ecole Superieure du Commerce Exterieur, Paris, France
Carolin Palmer
University of Giessen, Giessen, Germany, and
Norbert Kailer, Friedrich Lukas Kallinger and Jonathan Spitzer
Institute for Entrepreneurship and Organizational Development,
Johannes Kepler University Linz, Linz, Austria
Abstract
Purpose – Digital entrepreneurship is of high topicality as technological developments and advances in
infrastructure create various opportunities for entrepreneurs. Society’s great attention to new digital business
models is opposed to very little research regarding opportunities, challenges and success factors of digital
entrepreneurship. The purpose of this paper is to gather the state-of-the-art literature on digital
entrepreneurship and to provide an up-to-date compilation of key topics and methods discussed in the
relevant literature. Furthermore, based on findings of the systematic literature review, a research map
pointing at further research opportunities for scholars working in the field will be proposed.
Design/methodology/approach – Utilising a systematic search and review of literature across the domain
whilst following the established methodology of Tranfield et al. (2003) combined with the application of a
quality threshold for journal selection, 35 articles on digital entrepreneurship could be found relevant for an
evidence-informed literature review.
Findings – Based on a conceptual literature review, six streams of research that deal with digital
entrepreneurship are identified and discussed: digital business models; digital entrepreneurship process;
platform strategies; digital ecosystem; entrepreneurship education; and social digital entrepreneurship.
Originality/value – This systematic literature review identifies current research paths on digital
entrepreneurship by structuring the dispersed status quo of research in the identified different areas.
In addition, future research opportunities to deepen the understanding of digital entrepreneurship are
highlighted and pictured in a research map.
Keywords Business development, Opportunity, Entrepreneurship
Paper type Literature review
Introduction
Digital entrepreneurs with their new ways of doing business had an enormous effect on the
whole world, especially in the last decade. Google, Facebook, Microsoft and Apple not only
completely changed the business world, but also shaped the way we communicate with each
other in everyday life. At this stage, we live in a world of digitalisation, where artificial
intelligence can be used to enhance the quality of decisions and our perception of the reality
can be augmented to broaden our perspective in many ways. Developing a device is faster,
when its digital twin shows errors even before the physical product is completed.
Computing, storing and researching information is not only becoming easier, but also more
flexible and economical as cloud services are continuing to evolve and the internet
transforms towards the so-called Internet of Things (IoT). With blockchain, the transition to
the “Internet of Values” has just begun. By 2020, IoT technology is expected to be
implemented in 95 per cent of electronics for new product designs and a worldwide volume
of $1bn of legalised cryptocurrencies will be traded in the banking industry (Richter, Kraus
and Bouncken, 2015; Panetta, 2017).
International Journal of
Entrepreneurial Behavior &
Research
© Emerald Publishing Limited
1355-2554
DOI 10.1108/IJEBR-06-2018-0425
Received 30 June 2018
Revised 4 August 2018
16 August 2018
17 August 2018
Accepted 17 August 2018
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/1355-2554.htm
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As the digitalisation phenomenon causes various implications through rapid and
transformative change, it is relevant for entrepreneurs and entrepreneurship researchers to
be aware of related outcomes and connections and identify emerging opportunities on
business. In this paper we understand entrepreneurship as “the process of designing,
launching and running a new business” (Hsieh and Wu, 2018, p. 1) with its distinct
characteristic of “new value creation” (Hull et al., 2007, p. 293), though entrepreneurship is
more than starting up a new business. Applying a holistic perspective, entrepreneurial
activity arises of the interplay of institutions (e.g. education or business development),
stakeholders and entrepreneurs themselves (Palmer et al., 2018).
Digitalisation is not reduced to single new developments in entrepreneurship. Rather,
business models face a huge shift towards entire digital environments. In addition to new
businesses created out of arising opportunities due to digitalisation, existing branches
and businesses alter from offline to online business – establishing “digital entrepreneurship”
as a novel form of entrepreneurial activities. In this paper “digital entrepreneurship” is
understood as “a subcategory of entrepreneurship in which some or all of what would be
physical in a traditional organization has been digitized” (Hull et al., 2007, p. 293) and
thereby is defined as “the sale of digital products or services across electronic networks”
(Guthrie, 2014, p. 115).
Digital entrepreneurship is a phenomenon which arose through technological assets like
internet and information and communications technology (Le Dinh et al., 2018). In general,
any entrepreneurial activity that transfers an asset, service or major part of the business
into digital can be characterised as digital entrepreneurship. According to Hull et al. (2007),
digital entrepreneurs face a lot of differences compared to traditional entrepreneurs.
Products, marketing activities and workplace are major differentiation criteria between
digital and non-digital entrepreneurs.
Numerous opportunities for entrepreneurial activity got created through digitalisation
(cf. Hull et al., 2007). Entrepreneurs need to be aware of those opportunities in order to be
ready for sustainable innovations. Given the upward movement of digital entrepreneurship,
minimal research has addressed this topic and literature on digital entrepreneurship is quite
scarce. Besides, most of the articles selected within this literature review focus on a rather
narrow (sub)topic of digital entrepreneurship, which impedes a structured subsumption of
recent contributions in the broad domain of digital entrepreneurship.
This literature review should give guidance through the academic literature dealing with
the topic of digital entrepreneurship by providing a structured overview on the existing
literature. Furthermore, our research question concerns future developments of digital
entrepreneurship and according research. Therefore, we provide a theoretical approach to
the phenomenon of digital entrepreneurship and details about the search procedure and
“how to” of this paper, followed by a structured review elaborating impact of digitalisation
on business models (e.g. platform strategies, social digital entrepreneurship) and the digital
entrepreneurship process within the digital ecosystem. Based on the reviewed literature, we
give a brief summary of opportunities, challenges and success factors of digital
entrepreneurship and point to further research opportunities for scholars working in the
field by giving a research map on digital entrepreneurship. Limitations of this literature
review are given.
Defining digital entrepreneurship
In line with Hull et al. (2007), “digital entrepreneurship is a subcategory of entrepreneurship
in which some or all of what would be physical in a traditional organization has been
digitized” (p. 293) and thereby can be seen “as the reconciliation of traditional
entrepreneurship with the new way of creating and doing business in the digital era”
(Le Dinh et al., 2018, p. 1).
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Hair et al. (2012, p. 1250045 – 2) highlight the broad range of business models predestined
for digital entrepreneurship as “products, distribution, the workplace – any of these and more
could take digital form in an entrepreneurial venture”. In addition, Giones and Brem (2017) add
a more technology-centred view by listing “New products and services based on the internet.
Services running only in the cloud; using big data or artificial intelligence” (p. 45) as potential
types of digital entrepreneurship and understand “Technology as an input factor” (p. 45).
Sussan and Acs (2017, p. 66) expand this view of digital entrepreneurship by considering
the user dimension:
However, we view digital entrepreneurs here as Kirznarian entrepreneurship that operate within
the confines of existing platforms. In other words, they are performing activities that need digital
engagement but may not in themselves be digital, for example, an Uber taxi driver. The agent
leverages digital technology and seeks and acts on these opportunities within the marketplace in
effect increasing efficiency by moving the economy closer to the technological frontier.
Davidson and Vaast (2010) provide a slightly different definition of digital entrepreneurship:
We refer to digital entrepreneurship as the pursuit of opportunities based on the use of digital
media and other information and communication technologies. Digital entrepreneurs rely upon the
characteristics of digital media and IT to pursue opportunities. In doing so, they exacerbate
changes in the competitive landscape, as they attempt to seize the opportunities and thereby
potentially further the creative destruction process of the digital economy (p. 2).
Table I contains an overview of alternative definitions of digital entrepreneurship.
In a nutshell, digital entrepreneurship comprises “the sale of digital products or services
across electronic networks” (Guthrie, 2014, p. 115). Besides different definitions of the
phenomenon of digital entrepreneurship, the terminology of digital entrepreneurship is not
used throughout all articles in the same way. It is substituted by digital venture, digital
innovation, digital enterprise or digital business. Accordingly, in this literature review the
same terminology, which was used in the corresponding articles, was used.
State-of-the-art of current research
Review approach
Aiming to systematically search and structure the literature across the domain, our
methodology is that of an evidence-informed literature review (Tranfield et al., 2003).
Author Definition of digital entrepreneurship
Davidson and
Vaast (2010, p. 8)
Digital entrepreneurship: pursue new venture opportunities presented by new media
and internet technologies
Guthrie (2014,
p. 116)
[Digital entrepreneurship is] the creation of a venture to produce and generate revenue
from digital goods across electronic networks
Hair et al. (2012, p. 2) Digital entrepreneurship may be defined as entrepreneurship in which some or all of
the entrepreneurial venture takes place digitally instead of in more traditional formats
Hull et al. (2007,
p. 293)
Digital entrepreneurship is a subcategory of entrepreneurship in which some or all of
what would be physical in a traditional organisation has been digitised
Le Dinh et al.
(2018, p. 1)
Digital entrepreneurship is defined as the reconciliation of traditional entrepreneurship
with the new way of creating and doing business in the digital era
Richter et al.
(2017, p. 300)
Entrepreneurship [...] is [...] defined as occupying niches, monetizing business
opportunities, as well as being innovative, radical and risk-taking
Sussan and Acs
(2017, p. 66)
Digital entrepreneurship [...] includes any agent that is engaged in any sort of venture
be it commercial, social, government, or corporate that uses digital technologies. [...] In
other words, they are performing activities that need digital engagement but may not
in themselves be digital, for example, an Uber taxi driver
Table I.
Definitions of digital
entrepreneurship
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The first step within the literature review was utilising the Business Source Premier via
EBSCO host, selecting all available sub-databases in it (Business Source Premier, Econlit,
Entrepreneurial Studies Source), and using the key word “digital entre*”, “digital startup” as
well as the combination “digital innovation” AND “entre*”. After deleting the duplicated,
94 search results remained. After excluding all articles in non-English language as well as
reading the abstracts with regard to a topic fit (i.e. academic article with entrepreneurial
context), 53 search results remained. After conducting a quality threshold according to
Bouncken et al. (2015), only 35 articles in academic journals remained. We only used articles,
which are ranked in the German VHB Jourqual with “C” or higher and the corresponding
JCR impact factor of higher or the same 0.7 and the corresponding ABS ranking.
Table II provides an overview of the articles extracted, the underlying research method,
the country of sample’s origin, the research objective/aim and the main findings.
Research on digital entrepreneurship still seems to be in its infancy. Therefore, the
amount of articles dealing with the topic is not extensive. Only one article has been
published before 2010. A first empirical study has not been published before 2014. More
than half of the articles identified are younger than two years. A total of 13 of the articles
contain a theoretical approach to digital entrepreneurship. Qualitative methods are the
majority (eight articles) compared to quantitative papers ( five articles). Only two articles
apply both methods. Case studies are reported in seven papers.
Presentation of findings
To structure the findings within the selected literature, we clustered the associated research
topics into the following six categories: digital business models; digital entrepreneurship
process; platform strategies; digital ecosystem; entrepreneurship education; and social
digital entrepreneurship.
Digital business models
According to Hull et al. (2007) digital business models work in a very different way
compared to traditional ones. It is necessary for digital entrepreneurs to be aware of
differences, opportunities and threats in order to be successful; otherwise, the digital venture
is running considerable risk to fail. Wind (2008) states that digital businesses represent a
“shift from traditional management approaches to ‘network orchestration’ ” (p. 23), as
networks and communities are crucial for digital entrepreneurs.
Papers dealing with digital business models are very dominant in the existing literature.
Most of the articles dealt directly or at least indirectly with the emergence of new business
models. However, the articles have different approaches and furthermore deal with different
sectors of industry. This subsection is about identifying and discussing the different possible
business models identified by the several authors and provides a sufficient overview.
Dutot and Van Horne (2015) analysed digital business models in terms of the appearance
of goods and services, digitisation of the distribution channel, digital communication with
stakeholders and internal processes carried out on a digital basis. Richter et al. (2017) dealt
with the sharing economy, Ojala (2016) and Wright (2015) discussed new business models in
the gaming industry, Di Domenico et al. (2014) analysed home-based online ventures and the
concept of mental mobility, Kuester et al. (2018) wrote about the latest trend in
entrepreneurship concerning service innovation-based business models and Herrmann et al.
(2018) dealt with the innovation-driven transformations in the health care sector.
Furthermore, Troxler and Wolf (2017) discussed business models in the design community
and van der Ven (2017) discussed new digital business models for lawyers.
Moreover, authors not only describe new business models through digitalisation but also
deal with challenges and opportunities inherent in the emergence of new digital business
models in question. Nambisan (2017) especially deals with the refashioning of opportunities
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Author Year
Research
method Country Research objective/aim Main findings
Castro Soeiro et al. 2016 Qualitative
and
quantitative
Potential new business opportunity arising from
intersection of digital music and game industries
across borders throughout network-based innovation
approach
Interest and potential for developing new products
combining digital music and casual digital games
(more than one region), plus social network key
stakeholders
Davidson and
Vaast
2010 Case study USA Digital entrepreneurship and its sociomaterial
enactment
Opportunities of digital entrepreneurship through
social context, factors for entrepreneur’s success and
motivation
Di Domenico et al. 2014 Qualitative
(n ¼ 23)
“Mental mobility” in the digital age: entrepreneurs
and the online home-based business
Mental mobility: process through which individuals
navigate between physical and digital athmospheres of
work/overlapping home/workplace + manipulation
and reconcilation of the spatial, temporal and
emotional tensions in such work environments
Dutot and Van
Horne
2015 Qualitative
(n ¼ 10)
France/UAE Digital entrepreneurship intention in a developed vs
emerging country: an exploratory study in France and
the UAE
Factors influencing entrepreneurial intention
Dy et al. 2017 Qualitative
(n ¼ 26)
UK Women digital entrepreneurs and intersectionality
theory
The internet is not a neutral place without representing
social inequalities and discriminating the
disadvantaged
Ebel et al. 2016 Theoretical Leveraging virtual business model innovation: a
framework for designing business model development
tools
Framework for business model development
Giones and Brem 2017 Theoretical Identification and description of technology
entrepreneurship in times of digitisation
Characterisation of digital technology
entrepreneurship
Guthrie 2014 Qualitative
(n ¼ 15)
France Entrepreneurship education: learning project used in
an e-commerce major in a European business school
that involved launching a specialist blog
Low costs of starting a digital business; high interest of
students in developing digital business
Hair et al. 2012 Theoretical Market orientation in digital entrepreneurship:
advantages and challenges in a Web 2.0 networked
world
Opportunities/challenges through digitalization for
entrepreneurs
Herrmann et al. 2018 Quantitative Digital transformation and disruption of the health
care sector: internet-based observational study
Established corporations rely more on incremental
innovation that supports their current business
models, while start-ups engage their flexibility to
(continued )
Table II.
Current literature
on digital
entrepreneurship
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