Understand Complexity or Keep Fishing in the Dark : Generating Revenues as an International New Venture in the German Medtech Industry

Sammanfattning: International new ventures operate on international level at, or shortly after, their inception. However, many fail to generate revenues due to market complexity and lacking adaptation of the business model to the market. For outsiders, foreign markets are often difficult to understand, which is especially the case in highly regulated markets. The purpose of the study is to examine the role of market complexity in the internationalization process of an international new venture, and how to overcome such complexity to generate revenues through business model innovation. A single case study and qualitative interviewing has been used to examine market complexity in a particularly difficult market, the German medtech industry. A theoretical framework displaying the research assumption was created; that by understanding the complexity in a market, the entrepreneur can adapt the business model appropriately and generate revenues. To create an understanding of a complexity in the market, two theoretical models were constructed with different dimensions. The study shows that particular dimensions of market complexity were perceived more relevant than others. In this study, experience in the targeted market and knowledge of the local language were identified as the most important factors in overcoming market complexity. Further complexity factors were also identified, yet these may be greatly related to specific sectors and differ between industries, products, customers, and countries. Subsequently, a revised model for market complexity dimensions was constructed. This study focuses on the business model dimension of revenue streams. However, other dimensions of business model should also be considered in the internationalization process of INVs. It can be concluded that difficult markets can be made more understandable through analyzing the complexity dimensions, and revenues can be generated through business model innovation.