Business modeling of healthcare startups in a developing country: The influence of institutional factors

Healthcare startups drive innovation in the healthcare sector, yet they face a complex institutional environment to thrive, especially in developing countries. This study explores how institutional factors influence the creation and implementation of business models by healthtech startups in this context. Drawing on Institutional Theory and based on a multiple case study of 12 healthtech startups in Brazil, data reveal that, during the creation phase of the business model, cultural-cognitive factors, such as entrepreneurs’ backgrounds, are most influential. However, in the implementation phase, normative and regulatory factors such as professional authority and public policies gain importance as entrepreneurs navigate healthcare institutional challenges and opportunities. Different types of legitimacy must be conquered in business model creation and implementation. Findings can guide healthtech startup entrepreneurs in developing countries to overcome institutional barriers, gain legitimacy and enhance value appropriation, ensuring startupś sustainability.