Development Trajectory of An Innovation-Based Environmental Technology Start-Up

Abstract

This research paper focuses on the growth models of new business ventures and their applicability to a specific type of start-up, environmental technology-based growth company via a case study. Start-ups companies are a focal point of interest of this decade. Start-ups develop products and services in conditions of market and technological uncertainty and competitive volatility. Due to their crucial role in the net job creation there is a growing need and interest to understand, model and develop start-ups. One industry of high interest in regards of start-up activity is that of environmental technology business, as it is addressing needs for solving problems related to such global issues as pollution, waste management and need for renewable energy sources. However, there is a very limited amount of prior research focusing specifically to start-up companies in this field. E.g. the growth stage models of startup companies do not take in account the time dimensions caused by capital and regulatory demands that differentiate the development pace and stages of development of an environmental technology start-up from its peers in other industries. On the other hand, general research of environmental technology businesses often lacks the entrepreneurial and start-up focus, bundling efforts of new ventures in the field together with major projects by established companies. The aim of this paper is to provide a framework that helps understanding the growth process of new ventures in the aforementioned industry.In this case study, the authors assessed the suitability of models of growth dimensions, sources and obstacles proposed by earlier research and literature to a case company: a startup company providing environmental technology for global business-to-business markets. Via qualitative, interview-based data collection among the company stakeholder and external business experts and analysis of the obtained qualitative data the authors were able to draw conclusions regarding compatibility of the case to the earlier models of new venture growth. The results obtained shows that despite the common features between the case company´s growth trajectory and models proposed by earlier research, none of the stage models offers a full match. Based on the findings the authors propose a new, partly cyclical model of start-up growth for further elaboration.

Effective Venture Capital Market Development Concept

“…The most important subfactors from the factor group "infrastructure" are "high development of ICT industry" and "developed VC ecosystem with consultants and business angels". This finding is also in conformity with previous studies [57,62].…”

“…However, "high level of state R&D investments" has belowmoderate influence on the total market activity. The rating of state R&D investments being not high is unexpected based on previous studies regarding the importance of state R&D investments [57,58]. The relatively low rating for q24_4 during interviews with experts was explained by the opinion that sometimes the state with its support for R&D investments is crowding out private investors.…”