Business Model Theory

Chandra S. Mishra and Ramona K. Zachary
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Chandra S. Mishra: Florida Atlantic University
Ramona K. Zachary: The City University of New York

Chapter 9 in The Theory of Entrepreneurship, 2014, pp 227-250 from Palgrave Macmillan

Abstract: Abstract Teece (2007) posited that an enterprise’s success is contingent upon how astutely its business model is crafted. Entrepreneurial competence, formulated in Stage 1, will not result in value creation and appropriation without an efficient and sustainable business model design. Business models “reflect management’s hypothesis about what customers want and how an enterprise can best meet those needs, and get paid for doing so” (Teece, 2007, p. 1329). According to Chesbrough and Rosenbloom (2002, pp. 533–534), “The function of a business model is to ‘articulate’ the value proposition, select the appropriate technology and features, identify target market segments, define the structure of the value chain, and estimate the cost structure and profit potential.” Business models provide a rationale as to how value is created and appropriated within a venture.

Keywords: Cash Flow; Business Model; Initial Public Offering; Dynamic Capability; Venture Capital Investor (search for similar items in EconPapers)
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-137-37146-1_9

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DOI: 10.1057/9781137371461_9

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