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OPEN ENTREPRENERSHIP:EXPLORING ENTREPRENEURSHIPIN OPEN SOURCE COMMUNITIES

Zeynep YetisStockholm School of Economics

Department of Marketing and StrategyCenter for Strategy and CompetitivenessSupervisor: Dr. Robin Teigland, SSE

THESIS PROPOSAL PRESENTATION

June 2013

Presentation Structure

Finish

Introduction & Background

Theoretical Background & Research Purpose

Overview of Articles

Research Questions

Empirical Background

Data Collection and Methods of Analysis

Contributions

2

Time Frame

Start

The Firm

The Collective

vs

E.g., Microsoft~ Built by employees within

organizational boundaries

E.g., Linux~ Built by users and distributed freely regardless of affiliation~ 3rd mode of organizing economic activity?

Models of Knowledge Creation

“Open source” communities expanding beyond software

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THEORETICAL BACKGROUND

AND RESEARCH PURPOSE

• Attempts to measure success in OSS projects (Crowston et al., 2003; 2006).

• Yet, no substantial attempts to investigate factors that affect sustainability of open source communities.

• Therefore Article 1 aimed to answer following research question:

How can open source communities continuously achieve benefits that are attractive to all parties involved in order to sustain its operations?

Background for Dissertation Work

• Major finding of Article 1 entrepreneurs have crucial role in OpenSimulator community

• But would one expect to see entrepreneurial involvement in open source communities?

• OSS (open source software) communities can help entrepreneurs in overcoming liabilities of newness and small size (Aldrich & Ruef, 2006; Baker & Nelson, 2005), and may provide access to valuable global resources that are not available to entrepreneurs locally.

• But at same time, entrepreneurs can participate by free-riding on efforts of others in community.

Dominant presence of entrepreneurs…

• A review of of both entrepreneurship and online community literatures that encompasses open source communities showed that there is increasing evidence that OSS communities are becoming arenas for entrepreneurs to set-up their businesses (Giuri et al., 2008; Gruber and Henkel, 2006; Haefliger et al., 2010; Piva et al., 2012; Priem et al., 2012; Shah, 2005; Shah and Tripsas, 2007; Stam, 2010; Stam and Elfring, 2008; Thistoll, 2011; Von Krogh and Haefliger, 2010; Waguespack and Fleming, 2009).

Entrepreneurship in Open Source Communities

• German national• Female entrepreneur• Founder and director of Avination Virtual Limited, a

UK-based company operating Avination, an immersive 3D virtual environment for entertainment, education, and commerce

• Active core member of the OpenSimulator project with high level of developer expertise

• Defines herself as a virtual world role-play enthusiast

• Melanie and her global team at Avination develop features using OpenSimulator code as base, which they then monetize through sale on their grid

• When these features became “old hat” as Melanie puts it (usually after six months), Avination releases these features for free to OpenSimulator community

Example of an entrepreneur, Melanie

RESEARCHPURPOSE

Main research purpose of my dissertation is to investigate activities of entrepreneurs in open source communities.

RESEARCH QUESTIONS

OVERVIEW OF ARTICLES

RQ1: How do entrepreneurs identify business opportunities in open source communities through their networks?

RESEARCH QUESTION 1• Opportunity identification is integral part of entrepreneurial

venture creation (Shane and Venkataraman, 2000).• Since I am interested in understanding how entrepreneurs set

up and maintain their business in OSS communities, I would like to investigate how entrepreneurs recognize opportunities in OSS platforms and how networks of entrepreneurs effect opportunity identification processes.

RQ2: How do entrepreneurs contribute to the creation and accumulation of social capital in an open source community?

RESEARCH QUESTION 2• Entrepreneurship research has clearly pointed to importance of

social capital (Nahapiet & Ghoshal, 1998).• Social capital is both individual and group level concept (Lin,

2001), and recent entrepreneurship research suggests that interorganizational social capital is important for start-up performance (Pirolo & Presutti, 2010).

• More attention should be paid to entrepreneurs and their participation in open source communities. In particular impact of their participation in building of communities’ social capital.

RQ3a: What are the residual tasks in open source communities?RQ3b: Who conducts the residual tasks in open source communities? What role do entrepreneurs play in ensuring that the residual tasks are conducted?

RESEARCH QUESTION 3• Tasks that are deliberately not taken care of, so called residual tasks, may

hamper activity of an organization and threaten its longevity. • OCB (organizational citizenship behaviors) are suggested to enhance

organizational effectiveness (Bolino et al., 2002).• Developing strong sense of commitment makes individuals feel obligated

to share knowledge (Podsakoff et al., 2000) and help other members. A high level of social capital is therefore linked to reciprocity and commitment.

• Individuals with high degree of social capital are likely to be ones to carry out residual tasks in OSS communities, since those with high degree of social capital are also highly committed to community and its sustainability.

RQ4a: What are the processes through which the Bitcoin acts as an institutional entrepreneur?RQ4b: What is the role of entrepreneurs in enabling these?

RESEARCH QUESTION 4• Creating and maintaining legitimacy is as important as mastering

technical tasks for an organization’s success (Adler and Kwon, 2002).• Social capital theory and institutionalization theories are intertwined

and complementary (Adler and Kwon, 2002).• In the Bitcoin community: Lower-level aggregates, especially

entrepreneurs, are reshaping the higher-level aggregates, the financial institutions.

• Entrepreneurs are a very active group in the Bitcoin community.• The aim is to understand how this emergent, self-organizing online

collective is acting as a game changer within the global financial industry and the role of entrepreneurs in enabling this.

OVERVIEW OF ARTICLES

EMPIRICAL SETTINGS

Two different research sites that are both open source communities: OpenSimulator was chosen because:• continuous activity since its foundation in 2007, indicating

sustainability, at least to date• diverse membership in terms of demographics (e.g., age,

background, geography)

Bitcoin was chosen because:• comprising of individuals with a wide variety of backgrounds• relatively high involvement of entrepreneurs in the community• a peer-to-peer currency that is rivaling the financial institutions

EMPIRICAL SETTINGS

OpenSimulator Project

An open source community comprising different individuals and organizations developing a multi-

platform, multi-user 3D application enabling creation of customized virtual worlds.

URL: http://opensimulator.org/wiki/Main_Page

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Open source community comprising wide variety of individuals and organizations developing peer-to-peer

digital currency URL: http://bitcoin.org/en/

Ca. USD 1.3 bln in circulation and

50,000 daily transactions

DATA COLLECTION AND

METHODS OF ANALYSIS

Two periodsAug 2007 – Sep 2009Oct 2009 – Oct 2011

Text Analysis and SNA • Developer mailing list• Ohloh commit list• OpenSimulator wiki• SNS, blogs, homepages, etc.• Twenty-one interviews

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Nov 2009 to Jan 2013

Multi-method Case Study

Social network analysis & Semantic network analysis• Bitcoin Forum (English)

• 1.15 mln posts by 21,903 people• 85% all posts / 89% all people

• Secondary data• SNS, blogs, websites, etc.

• The relationship between each Bitcoin forum user’s posts and the proper nouns they contained are analyzed.

CONTRIBUTIONS

• OSS literature–Examine function of open source communities to entrepreneurs as arenas for building social capital

• Social capital literature –Extend social capital theory to OSS communities to show symbiotic relationship between OSS communities and entrepreneurs

• Entrepreneurship literature–Address different ways used by entrepreneurs to recognize opportunities in OSS communities–Dialectical view of entrepreneurs as individuals who pursue both self and collective interests (Van de ven et al., 2007)

• Institutional Theory literature –Contribute to developing field of distributed institutional entrepreneurship and role entrepreneurs play in pursuing distributed institutional entrepreneurship

I would further like to investigate the conditions that lead to open entrepreneurship and the impact of open entrepreneurship on

collective power.

Entrepreneurs openly engaging in social capital building activities through free revealing of intellectual property

and contribution of other resources with purpose of pursuing self business-related interests while contributing

to pursuit of mutual goals

“Open Entrepreneurship”

Summer, 2013

Work on Article 3 and submit

Attend ECIS 2013 (European Conference of Information Systems)

Attend Oxford Internet Institute Summer Doctoral Programme

Fall, 2013

Semester abroad at ETH Zurich with Dr. Georg von Krogh’s research group

Work on Article 6

Collect data for Article 5

Spring 2014

Work on Article 5

Fall 2014

Finalizing dissertation manuscript

Spring, 2015

Dissertation defense

TIME FRAME

QUESTIONS???

I would like to acknowledge the very helpful support of my colleagues, Paul Di Gangi of University of Alabama at Birmingham and Tomas Larsson of Kairos Future, along with my supervisor, Dr. Robin Teigland at SSE.