How Data-Driven Start-Ups Really Tick: Passau Project Examines Strategies and Business Models

The Bavarian Research Institute for Digital Transformation supports the project "Business models of data-driven start-ups and their positioning along the value chain" at the University of Passau.

In view of the advancing digitalisation, both established companies and start-ups must increasingly ask themselves how they want to position themselves facing the expectable changes in the value chain. The interdisciplinary Project “Business models of data-driven start-ups and their positioning along the value chain" (DaGeWe) at the University of Passau puts its research focus on different data-based approaches and strategies – and also evaluates which business models are successful to what extent. The Bavarian Academy of Sciences and Humanities and the Bavarian Research Institute for Digital Transformation (bidt) are providing around 200,000 euros to implement this project.

"A large number of these changes are triggered by the introduction of digital services by start-ups, which often serve as the basis for data-driven business models", explains Professor Jan H. Schumann from the Chair of Marketing and Innovation. While the media often spreads the image of start-ups that 'attack' established companies in many industries and thus increase competitive pressure, there is also a high number of start-ups that support incumbent firms instead of taking market share from them, Schumann says.

The DaGeWe project at the University of Passau aims to capture and examine the entire business spectrum. The aim of the project is to find out at which positions along the value chain data-driven start-ups are clustering, how their business models are structured, how start-ups make these strategic decisions and how they adapt them over time. "This enables the generation of strategic options to maintain or create competitive advantages for incumbent firms in a data-driven competitive environment. Thereby previously overlooked scopes of action regarding the social and economic megatrend of  digital transformation will be identified and closed ", explains Professor Obermaier from the Chair of Accounting and Controlling. 

The project is characterised by its interdisciplinarity. Both the Chair of Marketing and Innovation (Professor Jan H. Schumann) and the Chair of Accounting and Controlling (Professor Robert Obermaier) are involved. The team also includes Curd-Georg Eggert, M.Sc., Corinna Winkler, M.Sc. and Philipp Mosch, M.Sc. As an international expert, Professor Wolfgang Ulaga from the prestigious Business School Institut Européen d'Administration des Affaires (INSEAD) will contribute his knowledge from science and practice. His current research efforts on digital business models and the monetisation of data are highly related to the main focus of the project in Passau.

The project started on 1st January 2020 and will provide concrete insights into the patterns that can be identified in the strategy selection of data-driven start-ups over the course of one year. As a result, specific recommendations for action as response options for incumbent firms as well as start-ups will be developed. In addition, implications for politics and society will be deducted.