IT Entrepreneurial Strategies in Emerging Economies: Lessons from a Local Start-up

This study discusses the creation, survival and growth strategies of locally-based start-ups in emerging economies. The study consists of a revelatory case study analysis of an IT start-up in one of the largest developing countries of central and Eastern Europe, Romania. The analysis shows how IT entrepreneurs in developing countries can adapt to the institutional, resource and industry constraints of their environment and build a successful business. The results suggest successful IT start-ups can overcome the lack of formal institutions in developing countries by managing a relationship spiral: searching for potential business prospects among the IT entrepreneurs’ informal social networks and narrowing down these prospects until a client is identified. The analysis also suggests that IT start-ups in developing countries can overcome the industry constraints in these countries – the lack of supporting, complementary products and services – by managing a product spiral: adapting their generic product to each client and offering increasingly customized, vertically integrated products and services. The study also provides insights into how the activities of IT entrepreneurs in developing countries can contribute to economic growth not just through the creation of the local IT start-ups themselves, but also through the creation of new business opportunities for their clients. Workshop-specific keywords: ICT to support Small and Medium Enterprise (SME), Technological entrepreneurship as a path to prosperity.