The Initial Trajectory of New Venture Start-Ups - LESSONS from the Milk Crown Model FOR Services Management
Facing a paradigm shift from an industrial economy to a service-oriented economy, and in order to leverage such a shift, the initiatives of new ventures have been strongly expected. However, there exist some barriers impeding the successful trajectory of new venture start-ups, particularly in the initial stage of start-up. Therefore, identification of the crucial conditions governing the initial trajectory of new venture start-ups is extremely important for a service-oriented economy. Conditions governing this trajectory are similar to the formation process of the milk crown in the co-evolution of oil and water, where the affinity between internal conditions such as viscosity and liquidity and external circumstances is crucial. These conditions are similar to the start-up of new ventures, for which the affinity between the internal structure of ventures and external market conditions is crucial. Stimulated by these understandings and prompted by the Milk Crown Model formation concept, this paper attempts theoretical and empirical analyses that identify the governing factors of the initial trajectory of new venture start-ups. On the basis of a theoretical analysis of the formation process of the Milk Crown model in the co-evolutionary circumstances between water and oil, and also an empirical analysis of the successful trajectory of a leading Internet business, an attempt is made to develop a model depicting the initial trajectory of a new venture start-up. Utilizing this model and based on the empirical analysis, crucial factors decisive to the success of new ventures are identified, and policy suggestions supportive of services management for inducing start-up ventures in a service-oriented economy are extracted.