Business Model Design and the Performance of Entrepreneurial Firms By Christoph Zott INSEAD Euro-Asia Center 006 Boulevard de Constance 77305 Fontainebleau Cedex FRANCE Telephone: 33 1 6072 4364 Fax: 33 1 60 72 42 23 E-mail:
[email protected] and Raphael Amit The Wharton School University of Pennsylvania 3620 Locust walk Philadelphia, PA 19104-6370 Telephone: (215) 898-7731 Fax: (215) 573-7189 E-Mail:
[email protected] August 3, 2006 Both authors contributed equally to this article. Christoph Zott gratefully acknowledges financial support from the Alliance Center for Global Research & Development, and the Rudolf and Valeria Maag Fellowship in Entrepreneurship. Raffi Amit acknowledges generous financial support of the Wharton e- business initiative (a unit of the Mack Center for Technological Innovation at the Wharton School), and the Robert B. Goergen Chair in Entrepreneurship at the Wharton School. Both authors thank Iwona Bancerek, Amee Kamdar, and Jenny Koelle for their research assistance. We are grateful to Rich Burton and to two anonymous reviewers for helpful comments. For insightful comments during the development of this study, we would like to thank Eric Bradlow, Hubert Gatignon, Lorin Hitt, Ha Hoang, Quy Huy, Aba Krieger, Anita McGahan, Werner Reinartz, Nicolaj Siggelkow, Belen Villalonga, and seminar participants at Washington University in St. Louis and at the Wharton School. Business Model Design and the Performance of Entrepreneurial Firms Abstract We focus on a particular organization design issue – namely, the design of an organization’s set of boundary-spanning transactions – to which we refer as business model design, and ask how business model design affects the performance of entrepreneurial firms.