Entrepreneurial Patching: How do Start-ups Implement Incremental Innovation through Complementarities

Abstract

Mass phenomena of incremental innovation in start-ups in hybrid markets through complements have continued to emerge. However, the existing literature lacks such categories of research. Thus, it is necessary to explore how start-ups implement incremental innovation. By studying four SaaS exceptional growing start-ups that service four distinct traditional industries in the Zhongguancun Science Park of Beijing in China, we contribute a theoretical framework describing an incremental innovation process of dominant products in start-ups through complementarities in hybrid markets as entrepreneurial patching: (i) The dominant logic of entrepreneurial patching is the logic of learning by patching within start-ups; (ii) and the framework indicates that entrepreneurs focus on top-down patching in product markets while dominant product teams focus on bottom-up patching in product development. Central to our contribution is the notion that entrepreneurial patching effectively helps illustrate incremental innovation processes of dominant products in start-ups.