The dynamics of new sharing economy ventures strategies and ecosystem legitimacy: the case of Airbnb

Abstract

While new ventures strive to align with prevailing demand and expectations to gain and maintain legitimacy and successfully overcome the liability of newness, sharing economy ventures face additional legitimacy pressure before and after they achieve scale. Based on an inductive single case study approach, using the example of Airbnb Inc., this study investigates how digital platform‐based ventures navigate the tension between remaining legitimate yet distinctive throughout the organizational lifecycle. Adopting a processual perspective, our findings reveal the strategies used by Airbnb to navigate the temporal dynamics of entering established industries. With a particular focus on the digital platform's efforts to achieve and maintain cognitive and sociopolitical legitimacy, this study aims to enhance knowledge regarding the formation and adjustment of organizational strategy and identity over time. Our proposed model of digital platform development reveals three distinct stages of strategy shifts, including demonstrating a sense of novelty, establishing dominant positioning in a broader market, and competitive differentiation to create value for customers. Furthermore, we show the primary triggers for change and the organizational identity change process in different stages of the organizational lifecycle.

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