Mechanisms for digital business model innovation in international new ventures from developing economies

Abstract

Digital international new ventures (DINVs) increasingly leverage ecosystem partnerships to drive digital business model innovation (DBMI) and navigate global markets. However, research to examine how such partnerships contribute to DBMI is limited, particularly in resource-constrained firms from developing economies. Drawing on the dynamic capabilities view, organizational learning theory and an ecosystem-based digital learning perspective, we investigate the role of ecosystem partnerships in enabling DBMI through the development of digital learning capabilities. Based on survey data from 147 DINVs in a developing economy, findings suggest that ecosystem partnerships enhance digital learning, which in turn facilitates DBMI. Moreover, foreign market turbulence tends to positively moderate the relationship between ecosystem partnerships and digital learning capability. In addition to demonstrating how DINVs build innovation capacity under volatile conditions, findings help to extend perspectives on capabilities, learning, and ecosystems. Leveraging ecosystem partnerships, digital learning, and digital business model innovation appears to enhance the performance of DINVs. Ecosystem partnerships appear to be especially valuable to DINVs when market turbulence is high. The study offers theoretical and practical insights into the mechanism through which DINVs from developing economies can achieve digital innovation, and provides policy implications for supporting their international growth.