Absorptive Capacity, Growth Hacking, and Entrepreneurial Performance: PLS-Sem and Necessary Condition Analysis

This study aims to examine the role of absorptive capacity as an antecedent of growth hacking and its subsequent impact on entrepreneurial performance among SMEs in Indonesia. The study employed a purposive sampling technique, resulting in a sample of 276 SME owners and managers operating either fully digital or hybrid business models across various sectors that had adopted digitalization. The data were analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM) in combination with Necessary Condition Analysis (NCA). The findings show that the potential absorptive capacity enhances growth hacking but does not directly influence entrepreneurial performance, whereas realized absorptive capacity positively affects both growth hacking and entrepreneurial performance. Growth hacking also mediates the relationship between the dimensions of absorptive capacity and entrepreneurial performance. The NCA confirms that both absorptive capacity and growth hacking constitute necessary conditions for improving entrepreneurial performance. This study demonstrates how absorptive capacity contributes to growth hacking and entrepreneurial performance in SMEs, particularly in emerging economies. The findings also highlight the importance of developing absorptive capacity to support growth-oriented business practices to improve entrepreneurial performance.