Understanding the Role of Intellectual Property in Digital Technology-based Startups: Decisions and Dynamics

Abstract: Intellectual property (IP) has taken a central place as a source of competitive advantage in firms’ strategies. However, our knowledge on how IP is used by these firms in the digital age is still limited. The increasing prevalence of digital technologies further emphasizes the importance of intangible assets such as IP, while raising an open question with regard to how these assets should be selected and used to support business models and strategies. This thesis aims to address this question in the context of digital technology-based startups, which are in many ways at the forefront of advancing new digital technologies, business models and industries. By conducting a multiple case study of seven startups over the course of two years, the development of these startups’ IP strategies was mapped and analyzed resulting in two empirical papers on top of a literature review. This thesis notes the impact of the characteristics of digital technologies on the process and dynamics of IP strategy formation. Digital technology is systemic and can be developed on a more or less ongoing basis. As a result, IP decisions need to be flexible to enable and adapt to changes in technologies, business models and strategies. Moreover, the development of IP strategy through successive decision-making is based on available means to allow for goals to emerge rather than to be set in advance. The design of IP strategy therefore ends up fitting the design of digital technology in terms of its systemic structure and its development in which all outcomes cannot be envisioned in advance but are prepared for through incompleteness and flexibility in the design of decision-making.