Beyond the Big Idea: Performance Predictors in Entrepreneurial Firms

When we look at entrepreneurial companies we often focus on the obvious: what they do or sell. “What a great idea”, we say about the people who thought up eBay, “Why didn’t I think of that”?, we lament, while watching scooters fly off the shelves. But coming up with a bright idea is just part of the picture, say Professors Christoph Zott and Raphael Amit. In this recent working paper the authors address, through theoretical and empirical research, one of the key factors affecting entrepreneurs’ ability to create wealth: the design of their business model. They find that there is a positive association between business model design and firm performance and that the prevailing business climate has a strong influence on the appropriateness of each model.

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