AI Startup Business Models

Authors

Michael Weber, Technische Universitaet MuenchenFollow
Moritz Beutter, Technische Universität MünchenFollow
Jörg Weking, Technical University of MunichFollow
Markus Boehm, University of Applied Sciences Landshut, GermanyFollow
Helmut Krcmar, Technical University of MunichFollow

Document Type

Research Paper

Abstract

We currently observe the rapid emergence of startups that use Artificial Intelligence (AI) as part of their business model. While recent research suggests that AI startups employ novel or different business models, one could argue that AI technology has been used in business models for a long time already—questioning the novelty of those business models. Therefore, this study investigates how AI startup business models potentially differ from common IT-related business models. First, a business model taxonomy of AI startups is developed from a sample of 100 AI startups and four archetypal business model patterns are derived: AI-charged Product/Service Provider, AI Development Facilitator, Data Analytics Provider, and Deep Tech Researcher. Second, drawing on this descriptive analysis, three distinctive aspects of AI startup business models are discussed: (1) new value propositions through AI capabilities, (2) different roles of data for value creation, and (3) the impact of AI technology on the overall business logic. This study contributes to our fundamental understanding of AI startup business models by identifying their key characteristics, common instantiations, and distinctive aspects. Furthermore, this study proposes promising directions for future entrepreneurship research. For practice, the taxonomy and patterns serve as structured tools to support entrepreneurial action.

Recommended Citation

Weber, Michael; Beutter, Moritz; Weking, Jörg; Boehm, Markus; and Krcmar, Helmut (2022) "AI Startup Business Models," Business & Information Systems Engineering: Vol. 64: Iss. 1, 91-109.
Available at: https://aisel.aisnet.org/bise/vol64/iss1/6