Innovative business models for high-tech entrepreneurial ventures: the organizational design challenges

Entrepreneurial ventures operating in high-tech industries are more and more adopting innovative business models, which are based on use of the market for ideas instead of the market for products or on the leveraging of communities of users and developers. A common characteristic of these innovative business models is their dependence on innovative technological knowledge and, consequently, on the ways in which intellectual property rights over this knowledge are designed (i.e., tight vs. loose appropriability regime). This chapter grounds on mainstream organizational design theories to speculate on how high-tech entrepreneurial ventures should organize internally to successfully implement these innovative business models. Specifically, it analyzes how firms’ structure, decision rights, and human resource management practices should be adapted to the need of generating, absorbing, and protecting innovative technological knowledge. Heeding a recent call in management literature, we will conduct our analysis considering organizational design variables both at the individual and firm level.