Motivations, Success Factors and Challenges of Open Innovation for Start-ups

Abstract

One of the urgent challenges that small and medium enterprises face is the need to follow a continuous growth-path, particularly essential for Start-ups where global challenges force companies to look for even smarter ways to grow. If entrepreneurs agree with the idea that not all smart people work for their company, the embracement of the paradigm of ‘Open Innovation’ is a logical step. In other words, a company does not have to be the owner of an idea to benefit from an idea. Henceforth open innovation explores and exploits knowledge by sharing the innovation processes with third parties creating new opportunities for companies to profit from innovation. However, despite the growing literature on open innovation, so far, there has been little discussion on how start-ups can benefit from open innovation. The purpose of this paper is to clarify the concept of open innovation and to develop insights on how Open Innovation can benefit entrepreneurs who are in the process of creating their own start-up company. Studies in this review employed, show that there is not a generally accepted definition of what open innovation is and how it can be applied to companies in general and start-ups in specific. Additionally, it was noted that most studies in the field have only focused on open innovation using the perspective of a larger company. Very little was found in the literature on the start-up perspective. Therefore this paper discusses the reasons and motives of why students start-ups are encouraged to adopt open innovation practices. Moreover, the success factors and challenges that start-up face that implements open innovation practices are vital for all entrepreneurs to study as via open innovation start-ups can overcome the initial barriers that most start-ups face. This paper focusses on different dimensions of open innovation for students - Open Innovation vs Closed Innovation; Inbound vs Outside-in Innovation; Antecedents of open innovation; models of Open innovation; Success factors and Challenges - and serves as a guiding tool for student entrepreneurs to self-assess their start-up, so they can adapt and change in their start-up before an open innovation practice can be successfully implemented. Taken together, the open innovation paradigm should be in the mind-set of every student entrepreneur right from the start of the development of the business idea and the implementation of the business model, so consequently, the chance of a profitable and sustainable business future will increase for the start-up company.

Keywords: Student Start-ups, Entrepreneurship, Open Innovation

DOI: 10.54941/ahfe1002300