The Innovation Pivot Framework: Fostering Business Model Innovation in Startups

OVERVIEW:Business model design is critical for a startup. A successful design must be developed and tested with limited resources and under conditions of great uncertainty related to both internal and external factors. At the same time, this lack of definition is an excellent opportunity for business model innovation. In this paper, we present the Innovation Pivot Framework, a practical tool aimed at assisting entrepreneurs in identifying alternative uses of their innovation and deciding which applications and target markets they should pursue first. This process leads to a formulation of the source of competitive advantage based on the innovation envisioned. This tool may be useful both at the first moment of a startup’s conceptualization and when the new venture needs to redefine its competitive advantage. Beyond the area of entrepreneurship, it could also be an effective analysis tool to achieve better business model designs in well-established companies.