Entrepreneurial Orientation (EO) is an essential factor that positively influences entrepreneurial performance; however, its effect can only be felt via business model innovation.

This study investigates the underlying mechanism by studying 288 new entrepreneurial enterprises. Results demonstrate that business model innovation fully mediates between entrepreneurial orientation (EO) and performance; with market orientation acting to moderate this relationship.

1. Entrepreneurial bricolage

Entrepreneurial bricolage is an adaptive strategy used by new ventures to address resource limitations. This involves on-the-spot improvisation utilizing available resources in creative combinations for specific needs (Baker & Nelson, Citation 2005). This practice may arise as a response to limited financial resources and insufficient expertise (Baker & Nelson, Citation2005).

Prior research indicates that entrepreneurial bricolage (EB) can be an invaluable strategy for new businesses to develop and sustain competitive advantage, yet little is understood regarding its mechanisms of support. In this study, innovative ambidexterity mediates between entrepreneurial bricolage and new venture growth within ready-made garment industry businesses; providing entrepreneurs with an understanding of its role within their business models.

2. Business model innovation

An effective business model requires the integration of multiple elements into an organized structure, including product or service development, restructuring infrastructure configurations or shaping rules and policies.

Business model innovation refers to any change in how a firm creates and delivers value to its customers, often as part of an effort to gain a competitive advantage and enhance entrepreneurial performance.

This study explores the relationships among entrepreneurial bricolage, business model innovation, and entrepreneurial performance using data collected through a survey of entrepreneurial enterprises in Hubei Province. Furthermore, market orientation is explored as a moderating force. Results demonstrate that entrepreneurial bricolage significantly affects business model innovation while being positively regulated by market orientation.

3. Entrepreneurial performance

Entrepreneurial performance can be defined as a measure of how efficiently entrepreneurs achieve and sustain their goals, whether financial, social, environmental or innovation-related. Entrepreneurs demonstrate outstanding entrepreneurial performance when they achieve all their goals with minimal delays by meeting all deadlines efficiently while accomplishing multiple tasks within short amounts of time – this would constitute exceptional entrepreneurial performance.

Studies have linked entrepreneurial orientation (EO) dimensions such as autonomy, innovativeness, and risk taking to firm performance; however, little attention has been paid to how particular combinations of these dimensions contribute to high or low firm performance. Furthermore, its remains unclear how different stages of the firm life cycle impact relationships between EO dimensions and firm performance.

4. Entrepreneurial effort

Startups require extensive effort in order to generate revenue and remain viable in the marketplace, and entrepreneurs must carefully choose how much effort and what activities to put their resources towards. Aside from creating real value through productive endeavors, allocating resources toward rent-seeking could potentially create a vicious circle wherein entrepreneurs use their efforts simply to manipulate economic factors rather than create real value themselves.

Research indicates that market orientation heightens entrepreneurs’ sensitivity to market opportunities, leading them to be more adaptable in their approach to entrepreneurial bricolage and business model innovation – leading ultimately to improved entrepreneurial performance. This study explores this relationship by using moderating effects to examine how market orientation acts as a regulating factor; results reveal entrepreneurial bricolage has direct positive effects on business model innovation while business model innovation fully mediates this effect for entrepreneurial performance.

5. Market orientation

Although entrepreneurial orientation (EO) has an enormous effect on business models, few studies have focused on individual-level EO. EO has been associated with risk taking, innovation, proactiveness and competitive aggressiveness as well as being related to firm performance.

A key reason for the limited research done on Entrepreneurial Organizations (EO) is due to its many dimensions and measures being difficult to measure and comprehend. Furthermore, differentiating between different forms of entrepreneurship may be difficult due to its multiple definitions – especially since EO does not only exist within high technology start-ups such as software or biotech firms but can be found even among smaller businesses such as lawn care services or beauty shops.

Furthermore, the relationship between entrepreneurial orientation (EO) and performance can often be indirect due to its effects on other business factors; hence it is critical to identify potential moderating variables or boundary conditions of entrepreneurial orientation.