Are We Entering a Lucrative Market? A case study on resources and capabilities role for a start-up’s market entry and future success

Abstract

Background and Problem: Mymo is a new start-up formed in the year of 2013 and has recently entered the transportation and logistics industry with its IT-solution. For an entrepreneurial team the essential action is to enter a market, which involves an engagement in income generating activities. For a start-up, a fundamental decision that the entrepreneurial team has to take is which of the identified market opportunities to pursue or what market to enter. Lately, management and entrepreneurship research has started to deal with whether a company’s pre-entry firm resources impact a company’s choice of market entry or not. Purpose: The purpose of this master thesis is to study the connection between pre-entry resources and capabilities and market entry, as well as to understand and explain how this connection has or has not been applied in a start-up company. The study will examine what kind of resources and capabilities the start-up company possessed at the time of market entry, and how these have influenced the start-ups choice of market entry. The study will also examine the start-ups future potential within the entered market. Accordingly, the study will comprise of both a theoretical- and a practical research problem. Method: The chosen research design for this master thesis is a single case study on the start-up Mymo. In order to answer the purpose and research question(s) of this study qualitative semi-structured interviews have been performed with the entrepreneurial team of Mymo as well as with representatives from the transportation and logistics industry. Findings and Conclusions: The study shows that the pre-entry resources and capabilities in Mymo have influenced the start-ups choice of market entry towards the transportation and logistics industry. Resources and capabilities such as core- and specialized resources and capabilities have been shown, where the pre-entry knowledge and experience of the founders’ and the relationship with an important customer in the industry have been highly influential. Furthermore, a relationship has been found where the need and demand for the kind of service that Mymo provides have influenced the founders’ decision to enter the transportation and logistics market. In addition, Mymo seems to have good potential to succeed within the entered market, but they need to gain some complementary resources in order to profit from the business.