Corporate incubation for platform growth and the transition to platform scaling: Between a rock and a hard place in the circular economy

Abstract

Digital platforms are arguably instrumental for the Circular Economy (CE), yet they frequently fail to deliver. An increasingly popular strategy for developing digital platforms is corporate incubation, where corporations invest in startups. Prior research has nonetheless paid scant attention to the role of corporate incubation in the evolution of digital platforms over time. To shed light on this, we conducted a qualitative case study of a digital platform incubated by one of the largest construction firms in Europe in the context of corporate incubation. Building on prior research suggesting that platform growth and platform scaling are distinct but often conflated phenomena, our analysis reveals four mechanisms through which corporate incubation enables platform growth and (ii) unpacks its role in transitioning to platform scaling. Drawing on boundary work theory, we offer a model explaining how the boundary work frames of organizational actors involved in corporate incubation influence the evolution of digital platforms over time. Our study contributes to the literature on digital platforms for CE by establishing corporate incubation as a promising yet challenging strategy for achieving platform growth, by deciphering the relational and temporal dynamics that condition platform scaling, and by conceptualizing digital platforms as entities performing boundary work.