Expanding Entrepreneurial Ecosystem Boundaries with Digital Architecture: A Resource Perspective

Abstract

Despite the significant impact of digitalization on startups worldwide, the literature on entrepreneurial ecosystems has not fully considered the role of digitalization. The advancement of digital technologies enables entrepreneurs to engage in venturing activities independent from locations and therefore changes the traditional physical boundaries of entrepreneurial ecosystems. In particular, it remains unclear how digitalization enables new ways of resource acquisition and consequently opportunities to overcome regional resource scarcity. This study examines how and with what capabilities an entrepreneurial ecosystem can overcome resource scarcity by complementing its physical core with a digital sphere. Building on an exploratory qualitative single-case study of the Estonian entrepreneurial ecosystem, this study suggests a process model that captures essential ecosystem capabilities in acquiring and mobilizing resources to develop entrepreneurial ecosystem: (1) sensing opportunities to overcome ecosystem resource scarcity, (2) seizing opportunities by building a hybrid ecosystem architecture, (3) seizing opportunities by coordinating resource flows, and (4) reconfiguring ecosystem architecture. Our findings extend the literature on entrepreneurial ecosystems by integrating digital dimensions into analyses and by theorizing the capabilities of entrepreneurial ecosystems. Furthermore, this study provides valuable practical implications for policymakers and other stakeholders seeking to overcome regional resource constraints by utilizing a hybrid ecosystem architecture.