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Under the radar: Industry entry by user entrepreneurs

Haefliger, S., Jäger, P. & Von Krogh, G. (2010). Under the radar: Industry entry by user entrepreneurs. Research Policy, 39(9), pp. 1198-1213. doi: 10.1016/j.respol.2010.07.001


We inductively develop a model of the commercialization process for new products or services user entrepreneurs undertake when entering an industry while drawing on proprietary technology developed in another industry. Extending the growing field of user entrepreneurship, we identify a two-phase approach to industry entry by user entrepreneurs who start "under the radar" of incumbent firms, gain experience, attract a first potential customer base, and then, in a second phase, engage in commercialization. During this process, a community of fellow users is of major importance for the entrepreneur, serving as a knowledge pool for skills development and experimentation with different commercialization paths. We study a nascent group of firms founded by users of video games who became entrepreneurs on entering the animation industry by producing Machinima, a new film genre characterized by shooting film in video games. We explain how user entrepreneurs gain access to complementary assets (video games) for their new use (shooting film), how they deal with intellectual property issues when using other firms' assets, and how user entrepreneurs combine domain knowledge about film production with their experience in video games and the art of Machinima. Our propositions hold implications for management and policy.

Publication Type: Article
Additional Information: NOTICE: this is the author’s version of a work that was accepted for publication in Research Policy. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published in Research Policy, Volume 39, Issue 9, November 2010, Pages 1198–1213,
Publisher Keywords: Complementary assets, Intellectual property, Machinima, Market entry, User entrepreneur, User innovation
Subjects: H Social Sciences > HF Commerce
Departments: Bayes Business School > Management
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