Development of Sharia Business Models for Technology Startups
Article Sidebar
-
Sharia Business, Sharia Principles, Technology Startup
Abstract
Indonesia has seen rapid growth of technology startups in recent years. However, many startups have yet to capitalize on the sharia business model, which can be an attractive alternative to address social and economic challenges. The main objective of this study is to develop a sharia business model that is suitable for technology startups in Indonesia. Specifically, this study aims to identify the key elements of a sharia business model that are relevant for technology startups, analyze the benefits and barriers of implementing a sharia business model in the technology industry, and formulate an effective implementation strategy for technology startups to adopt a sharia business model. This study uses a combination of qualitative and quantitative methods. In the first stage, the literature was thoroughly studied and interviews were conducted with sharia business experts and technology startup activists to determine the main components of the sharia business model. The results of the study indicate that the main components of the relevant sharia business model for technology startups include the principle of profit sharing (profit sharing), prohibition of riba (interest-free financing), and fairness and transparency in transactions. The survey results also show that most technology startup founders see the sharia business model as an alternative that can attract investors and consumers. This study found that technology startups in Indonesia have great potential to implement a sharia business model if there is a strong effort to educate and provide resources.
Full text article
References
Adler, P., Florida, R., King, K., & Mellander, C. (2019). The city and high-tech startups: The spatial organization of Schumpeterian entrepreneurship. Cities, 87, 121–130.https://doi.org/10.1016/j.cities.2018.12.013
Ahluwalia, S., Mahto, R.V., & Guerrero, M. (2020). Blockchain technology and startup financing: A transaction cost economics perspective. Technological Forecasting and Social Change, 151, 119854.https://doi.org/10.1016/j.techfore.2019.119854
Aldianto, L., Anggadwita, G., Permatasari, A., Mirzanti, IR, & Williamson, IO (2021). Toward a Business Resilience Framework for Startups. Sustainability, 13(6), 3132.https://doi.org/10.3390/su13063132
Bandera, C., & Thomas, E. (2019). The Role of Innovation Ecosystems and Social Capital in Startup Survival. IEEE Transactions on Engineering Management, 66(4), 542–551.https://doi.org/10.1109/TEM.2018.2859162
B?rbulescu, O., Tec?u, A.S., Munteanu, D., & Constantin, C.P. (2021). Innovation of Startups, the Key to Unlocking Post-Crisis Sustainable Growth in Romanian Entrepreneurial Ecosystem. Sustainability, 13(2), 671.https://doi.org/10.3390/su13020671
Caseiro, N., & Coelho, A. (2019). The influence of Business Intelligence capacity, network learning and innovativeness on startups performance. Journal of Innovation & Knowledge, 4(3), 139–145.https://doi.org/10.1016/j.jik.2018.03.009
Cavallo, A., Ghezzi, A., Dell'Era, C., & Pellizzoni, E. (2019). Fostering digital entrepreneurship from startup to scaleup: The role of venture capital funds and angel groups. Technological Forecasting and Social Change, 145, 24–35.https://doi.org/10.1016/j.techfore.2019.04.022
Chatterji, A., Delecourt, S., Hasan, S., & Koning, R. (2019). When does advice impact startup performance? Strategic Management Journal, 40(3), 331–356.https://doi.org/10.1002/smj.2987
Cho, M., Bonn, M.A., & Han, S.J. (2020). Innovation ambidexterity: Balancing exploitation and exploration for startup and established restaurants and impacts upon performance. Industry and Innovation, 27(4), 340–362.https://doi.org/10.1080/13662716.2019.1633280
Cohen, S., Fehder, D. C., Hochberg, Y. V., & Murray, F. (2019). The design of startup accelerators. Research Policy, 48(7), 1781–1797.https://doi.org/10.1016/j.respol.2019.04.003
Del Sarto, N., Isabelle, D. A., & Di Minin, A. (2020). The role of accelerators in firm survival: An fsQCA analysis of Italian startups. Technovation, 90–91, 102102.https://doi.org/10.1016/j.technovation.2019.102102
Desai, P., & Ganatra, K. (2022). Artificial Intelligence In Strengthening The Operations Of Ecommerce Based Business. 2022 Interdisciplinary Research in Technology and Management (IRTM), 1–7.https://doi.org/10.1109/IRTM54583.2022.9791598
Doblinger, C., Surana, K., & Anadon, L.D. (2019). Governments as partners: The role of alliances in US cleantech startup innovation. Research Policy, 48(6), 1458–1475.https://doi.org/10.1016/j.respol.2019.02.006
Du, D., Yu, T., Xia, Y., Zang, B., Yan, G., Qin, C., Wu, Q., & Chen, H. (2020). Catalyzer: Sub-millisecond Startup for Serverless Computing with Initialization-less Booting. Proceedings of the Twenty-Fifth International Conference on Architectural Support for Programming Languages and Operating Systems, 467–481.https://doi.org/10.1145/3373376.3378512
Ghezzi, A. (2019). Digital startups and the adoption and implementation of Lean Startup Approaches: Effectuation, Bricolage and Opportunity Creation in practice. Technological Forecasting and Social Change, 146, 945–960.https://doi.org/10.1016/j.techfore.2018.09.017
Ghezzi, A., & Cavallo, A. (2020). Agile Business Model Innovation in Digital Entrepreneurship: Lean Startup Approaches. Journal of Business Research, 110, 519–537.https://doi.org/10.1016/j.jbusres.2018.06.013
Gloor, P. A., Fronzetti Colladon, A., Grippa, F., Hadley, B. M., & Woerner, S. (2020). The impact of social media presence and board member composition on new venture success: Evidence from VC-backed US startups. Technological Forecasting and Social Change, 157, 120098.https://doi.org/10.1016/j.techfore.2020.120098
Hegeman, P.D., & Sørheim, R. (2021). Why do they do it? Corporate venture capital investments in cleantech startups. Journal of Cleaner Production, 294, 126315.https://doi.org/10.1016/j.jclepro.2021.126315
Horne, J., & Fichter, K. (2022). Growing for sustainability: Enablers for the growth of impact startups – A conceptual framework, taxonomy, and systematic literature review. Journal of Cleaner Production, 349, 131163.https://doi.org/10.1016/j.jclepro.2022.131163
Hornuf, L., Klus, M.F., Lohwasser, T.S., & Schwienbacher, A. (2021). How do banks interact with fintech startups? Small Business Economics, 57(3), 1505–1526.https://doi.org/10.1007/s11187-020-00359-3
Huang, S.-Z., Chau, K.Y., Chien, F., & Shen, H. (2020). The Impact of Startups' Dual Learning on Their Green Innovation Capability: The Effects of Business Executives' Environmental Awareness and Environmental Regulations. Sustainability, 12(16), 6526.https://doi.org/10.3390/su12166526
Kim, H. J., Kim, T. S., & Sohn, S. Y. (2020). Recommendation of startups as technology cooperation candidates from the perspectives of similarity and potential: A deep learning approach. Decision Support Systems, 130, 113229.https://doi.org/10.1016/j.dss.2019.113229
Li, J., Li, Z., Xiao, S., Fu, Q., Kobayashi, H., Zhang, L., Liao, Q., & Zhu, X. (2020). Startup cathode potentials determine electron transfer behaviors of biocathodes catalysing CO2 reduction to CH4 in microbial electrosynthesis. Journal of CO2 Utilization, 35, 169–175.https://doi.org/10.1016/j.jcou.2019.09.013
Li, S., Li, D., Wang, Y., Zeng, H., Yuan, Y., & Zhang, J. (2020). Startup and stable operation of advanced continuous flow reactor and the changes of microbial communities in aerobic granular sludge. Chemosphere, 243, 125434.https://doi.org/10.1016/j.chemosphere.2019.125434
Liese, E., Albright, J., & Zitney, S. A. (2020). Startup, shutdown, and load-following simulations of a 10 MWe supercritical CO2 recompression closed Brayton cycle. Applied Energy, 277, 115628.https://doi.org/10.1016/j.apenergy.2020.115628
Lin, M., Chen, Z., Chen, R., & Fujita, H. (2021). Evaluation of startup companies using multicriteria decision making based on hesitant fuzzy linguistic information envelope analysis models. International Journal of Intelligent Systems, 36(5), 2292–2322.https://doi.org/10.1002/int.22379
McDonald, R. M., & Eisenhardt, K. M. (2020). Parallel Play: Startups, Nascent Markets, and Effective Business-model Design. Administrative Science Quarterly, 65(2), 483–523.https://doi.org/10.1177/0001839219852349
Oliva, F.L., & Kotabe, M. (2019). Barriers, practices, methods and knowledge management tools in startups. Journal of Knowledge Management, 23(9), 1838–1856.https://doi.org/10.1108/JKM-06-2018-0361
Oliva, FL, Teberga, PMF, Testi, LIO, Kotabe, M., Giudice, MD, Kelle, P., & Cunha, MP (2022). Risks and critical success factors in the internationalization of born global startups of industry 4.0: A social, environmental, economic, and institutional analysis. Technological Forecasting and Social Change, 175, 121346.https://doi.org/10.1016/j.techfore.2021.121346
Pan, F., & Yang, B. (2019). Financial development and the geographies of startup cities: Evidence from China. Small Business Economics, 52(3), 743–758.https://doi.org/10.1007/s11187-017-9983-2
Razavi Hajiagha, SH, Ahmadzadeh Kandi, N., Amoozad Mahdiraji, H., Jafari-Sadeghi, V., & Hashemi, SS (2022). International entrepreneurial startups' location under uncertainty through a heterogeneous multi-layer decision-making approach: Evidence and application of an emerging economy. International Journal of Entrepreneurial Behavior & Research, 28(3), 767–800.https://doi.org/10.1108/IJEBR-05-2021-0387
Saura, J.R., Palos-Sanchez, P., & Grilo, A. (2019). Detecting Indicators for Startup Business Success: Sentiment Analysis Using Text Data Mining. Sustainability, 11(3), 917.https://doi.org/10.3390/su11030917
Schückes, M., & Gutmann, T. (2021). Why do startups pursue initial coin offerings (ICOs)? The role of economic drivers and social identity on funding choice. Small Business Economics, 57(2), 1027–1052.https://doi.org/10.1007/s11187-020-00337-9
Shepherd, D. A., & Gruber, M. (2021). The Lean Startup Framework: Closing the Academic–Practitioner Divide. Entrepreneurship Theory and Practice, 45(5), 967–998.https://doi.org/10.1177/1042258719899415
Silva, D.S., Ghezzi, A., Aguiar, R.B.D., Cortimiglia, M.N., & Ten Caten, C.S. (2020). Lean Startup, Agile Methodologies and Customer Development for business model innovation: A systematic review and research agenda. International Journal of Entrepreneurial Behavior & Research, 26(4), 595–628.https://doi.org/10.1108/IJEBR-07-2019-0425
Singh, S., Chauhan, A., & Dhir, S. (2019). Analyzing the startup ecosystem of India: A Twitter analytics perspective. Journal of Advances in Management Research, 17(2), 262–281.https://doi.org/10.1108/JAMR-08-2019-0164
Sivathanu, B., & Pillai, R. (2019). An empirical study on entrepreneurial bricolage behavior for sustainable enterprise performance of startups: Evidence from an emerging economy. Journal of Entrepreneurship in Emerging Economies, 12(1), 34–57.https://doi.org/10.1108/JEEE-01-2019-0009
Tripathi, N., Oivo, M., Liukkunen, K., & Markkula, J. (2019). Startup ecosystem effect on minimum viable product development in software startups. Information and Software Technology, 114, 77–91.https://doi.org/10.1016/j.infsof.2019.06.008
Tripathi, N., Seppänen, P., Boominathan, G., Oivo, M., & Liukkunen, K. (2019). Insights into startup ecosystems through exploration of multi-vocal literature. Information and Software Technology, 105, 56–77.https://doi.org/10.1016/j.infsof.2018.08.005
Van Rijnsoever, F. J. (2022). Intermediaries for the greater good: How entrepreneurial support organizations can embed constrained sustainable development startups in entrepreneurial ecosystems. Research Policy, 51(2), 104438.https://doi.org/10.1016/j.respol.2021.104438
Wagner, S. M. (2021). Startups in the supply chain ecosystem: An organizing framework and research opportunities. International Journal of Physical Distribution & Logistics Management, 51(10), 1130–1157.https://doi.org/10.1108/IJPDLM-02-2021-0055
Yang, S., Kher, R., & Newbert, S. L. (2020). What signals matter for social startups? It depends: The influence of gender role congruity on social impact accelerator selection decisions. Journal of Business Venturing, 35(2), 105932.https://doi.org/10.1016/j.jbusvent.2019.03.001
Yildirim, A., Kenway, G.K.W., Mader, C.A., & Martins, JRRA (2019). A Jacobian-free approximate Newton–Krylov startup strategy for RANS simulations. Journal of Computational Physics, 397, 108741.https://doi.org/10.1016/j.jcp.2019.06.018
Zahra, SA (2021). The Resource-Based View, Resourcefulness, and Resource Management in Startup Firms: A Proposed Research Agenda. Journal of Management, 47(7), 1841–1860.https://doi.org/10.1177/01492063211018505
Zhao, B., & Ziedonis, R. (2020). State governments as financiers of technology startups: Evidence from Michigan's R&D loan program. Research Policy, 49(4), 103926.https://doi.org/10.1016/j.respol.2020.103926
Authors
Copyright (c) 2024 Agus Zainul Arifin, Wolnough Cale, Haryanto Tanuwijaya
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
