When the window of opportunity opens: how does open search impact the business model design of digital startups?

Abstract

ABSTRACT Open search is crucial to business model design. In recent years, the digital revolution has significantly reshaped the open search environment and the business model landscape. The traditional ‘either/or’ paradigm that separately tests the effects of open search breadth and depth on business model design is no longer applicable. By introducing the ‘both/and’ paradigm, this study explores how open search breadth and depth, both jointly and in an orderly manner, impact hybrid business model design. Using a sample of digital startups during the opportunity window of China’s digital entrepreneurship, we find that open search breadth positively relates to the balance between technology- and consumer-oriented business models. Furthermore, under the premise of high breadth, open search depth shows a U-shaped relationship with this balance. This study not only enriches our knowledge of the antecedents of business model design but also provides a comprehensive understanding of the role of open search.