Business model evolution and firm performance of entrepreneurial companies

This research explores the business model (BM) evolution process of entrepreneurial companies and investigates the relationship between BM evolution and firm performance. Recently, it has been increasingly recognised that the innovative design (and re-design) of BMs is crucial to the performance of entrepreneurial firms, as BM can be associated with superior value creation and competitive advantage. However, there has been limited theoretical and empirical evidence in relation to the micro-mechanisms behind the BM evolution process and the entrepreneurial outcomes of BM evolution. This research seeks to fill this gap by opening up the ‘black box’ of the BM evolution process, exploring the micro-patterns that facilitate the continuous shaping, changing, and renewing of BMs and examining how BM evolutions create and capture value in a dynamic manner. Drawing together the BM and strategic entrepreneurship literature, this research seeks to understand: (1) how and why companies introduce BM innovations and imitations; (2) how BM innovations and imitations interplay as patterns in the BM evolution process; and (3) how BM evolution patterns affect firm performances. This research adopts a longitudinal multiple case study design that focuses on the emerging phenomenon of BM evolution. Twelve entrepreneurial firms in the Chinese Online Group Buying (OGB) industry were selected for their continuous and intensive developments of BMs and their varying success rates in this highly competitive market. Two rounds of data collection were carried out between 2013 and 2014, which generates 31 interviews with founders/co-founders and in total 5,034 pages of data. Following a three-stage research framework, the data analysis begins by mapping the BM evolution process of the twelve companies and classifying the changes in the BMs into innovations and imitations. The second stage focuses down to the BM level, which addresses the BM evolution as a dynamic process by exploring how BM innovations and imitations unfold and interplay over time. The final stage focuses on the firm level, providing theoretical explanations as to the effects of BM evolution patterns on firm performance. This research provides new insights into the nature of BM evolution by elaborating on the missing link between BM dynamics and firm performance. The findings identify four patterns of BM evolution that have different effects on a firm’s short- and long-term performance. This research contributes to the BM literature by presenting what the BM evolution process actually looks like. Moreover, it takes a step towards the process theory of the interplay between BM innovations and imitations, which addresses the role of companies’ actions, and more importantly, reactions to the competitors. Insights are also given into how entrepreneurial companies achieve and sustain value creation and capture by successfully combining the BM evolution patterns. Finally, the findings on BM evolution contributes to the strategic entrepreneurship literature by increasing the understanding of how companies compete in a more dynamic and complex environment. It reveals that, the achievement of superior firm performance is more than a simple question of whether to innovate or imitate, but rather an integration of innovation and imitation strategies over time. This study concludes with a discussion of the findings and their implications for theory and practice.

A two-fluid model for tissue growth within a dynamic flow environment

We study the growth of a tissue construct in a perfusion bioreactor, focussing on its response to the mechanical environment. The bioreactor system is modelled as a two-dimensional channel containing a tissue construct through which a flow of culture medium is driven. We employ a multiphase formulation of the type presented by G. Lemon, J. King, H. Byrne, O. Jensen and K. Shakesheff in their study (Multiphase modelling of tissue growth using the theory of mixtures. J. Math. Biol. 52(2), 2006, 571–594) restricted to two interacting fluid phases, representing a cell population (and attendant extracellular matrix) and a culture medium, and employ the simplifying limit of large interphase viscous drag after S. Franks in her study (Mathematical Modelling of Tumour Growth and Stability. Ph.D. Thesis, University of Nottingham, UK, 2002) and S. Franks and J. King in their study Interactions between a uniformly proliferating tumour and its surrounding: Uniform material properties. Math. Med. Biol. 20, 2003, 47–89). The novel aspects of this study are: (i) the investigation of the effect of an imposed flow on the growth of the tissue construct, and (ii) the inclusion of a chanotransduction mechanism regulating the response of the cells to the local mechanical environment. Specifically, we consider the response of the cells to their local density and the culture medium pressure. As such, this study forms the first step towards a general multiphase formulation that incorporates the effect of mechanotransduction on the growth and morphology of a tissue construct. The model is analysed using analytic and numerical techniques, the results of which illustrate the potential use of the model to predict the dominant regulatory stimuli in a cell population.

Mode locking in a spatially extended neuron model: active soma and compartmental tree

Understanding the mode-locked response of excitable systems to periodic forcing has important applications in neuroscience. For example it is known that spatially extended place cells in the hippocampus are driven by the theta rhythm to generate a code conveying information about spatial location. Thus it is important to explore the role of neuronal dendrites in generating the response to periodic current injection. In this paper we pursue this using a compartmental model, with linear dynamics for each compartment, coupled to an active soma model that generates action potentials. By working with the piece-wise linear McKean model for the soma we show how the response of the whole neuron model (soma and dendrites) can be written in closed form. We exploit this to construct a stroboscopic map describing the response of the spatially extended model to periodic forcing. A linear stability analysis of this map, together with a careful treatment of the non-differentiability of the soma model, allows us to construct the Arnol'd tongue structure for 1:q states (one action potential for q cycles of forcing). Importantly we show how the presence of quasi-active membrane in the dendrites can influence the shape of tongues. Direct numerical simulations confirm our theory and further indicate that resonant dendritic membrane can enlarge the windows in parameter space for chaotic behavior. These simulations also show that the spatially extended neuron model responds differently to global as opposed to point forcing. In the former case spatio-temporal patterns of activity within an Arnol'd tongue are standing waves, whilst in the latter they are traveling waves.