Research on the Design of Business Models and Transformation Management of New Entrepreneurial Ventures Driven by Artificial Intelligence

Abstract

This study aims to explore the design of business models and transformation management of new entrepreneurial ventures driven by artificial intelligence (AI). Through literature analysis, the study delves into the impact of AI applications on business models in new entrepreneurial ventures and explores effective strategies for transformation management. Firstly, the research reviews the concepts and development of artificial intelligence, analyzes the theoretical foundations of business model design for new entrepreneurial ventures, and emphasizes its importance. Secondly, this paper discusses the opportunities and challenges brought by artificial intelligence to traditional business models, as well as the role and influence of artificial intelligence in enterprise transformation management. Finally, focusing on business model innovation, the research reveals methods and strategies for utilizing artificial intelligence technologies in business model innovation. The research findings indicate that artificial intelligence has a significant impact on the design of business models and transformation management in new entrepreneurial ventures, providing innovative opportunities and effective transformation pathways. However, the study also has certain limitations, and future research can further explore other relevant factors and expand the sample size for a more comprehensive understanding.

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Research on the Design of Business Models and
Transformation Management of New Entrepreneurial Ventures
Driven by Artificial Intelligence
Junchao Fang
Building 13, Yuxing Garden, No. 111 Hengshan Road, Qinchuan Street, Changshu City, Jiangsu,
China
asd523184631@gmail.com
Abstract. This study aims to explore the design of business models and transformation management
of new entrepreneurial ventures driven by artificial intelligence (AI). Through literature analysis, the
study delves into the impact of AI applications on business models in new entrepreneurial ventures
and explores effective strategies for transformation management. Firstly, the research reviews the
concepts and development of artificial intelligence, analyzes the theoretical foundations of business
model design for new entrepreneurial ventures, and emphasizes its importance. Secondly, this paper
discusses the opportunities and challenges brought by artificial intelligence to traditional business
models, as well as the role and influence of artificial intelligence in enterprise transformation
management. Finally, focusing on business model innovation, the research reveals methods and
strategies for utilizing artificial intelligence technologies in business model innovation. The research
findings indicate that artificial intelligence has a significant impact on the design of business models
and transformation management in new entrepreneurial ventures, providing innovative opportunities
and effective transformation pathways. However, the study also has certain limitations, and future
research can further explore other relevant factors and expand the sample size for a more
comprehensive understanding.
Keywords: Artificial intelligence, New entrepreneurial ventures, Business model, Transformation
management, Model design.
1. Introduction
In recent years, the rapid development of artificial intelligence (AI) has brought about significant
transformations and opportunities across various industries. Especially in the realm of new
entrepreneurial ventures, the application of AI technology has not only fostered business model
innovation but also propelled enterprise transformation and growth [1]. This study aims to explore
the design of business models and transformation management of new entrepreneurial ventures driven
by artificial intelligence, aiming to uncover its practical applications and effects. In recent years,
scholars both domestically and internationally have conducted extensive research on the design of
business models and transformation management of new entrepreneurial ventures driven by artificial
intelligence. Lee et al. (2019) described AI technology as a catalyst for business model innovation,
highlighting the serendipitous factors that arise from emerging technologies [2]. Garbuio and Lin
(2019) provided timely and critical analysis of AI-driven healthcare startups, proposing a
methodology for designing business models for AI healthcare startups, and identifying emerging
business model prototypes used by entrepreneurs worldwide to bring AI solutions to the market [3].
Wang et al. (2022) introduced AI and blockchain-based business innovation to enhance business
practices and maintain secure interactions among diverse customers [4]. Therefore, by synthesizing
these literature findings, this paper aims to elucidate the key issues in business model innovation and
transformation management within new entrepreneurial ventures driven by artificial intelligence, and
provide relevant solutions and recommendations.

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2. Artificial Intelligence and Business Model Design for New Entrepreneurial
Ventures
2.1 Definition and Development of Artificial Intelligence and New Entrepreneurial Ventures
2.1.1 Artificial Intelligence
Artificial Intelligence (AI) is a technology and system that aims to simulate and execute tasks
similar to human thinking and decision-making [5]. It involves building intelligent agents capable of
perceiving the environment, understanding and learning knowledge, reasoning and making decisions,
and interacting and communicating with humans. Key features of artificial intelligence include
machine learning, natural language processing, computer vision, and expert systems. It has a wide
range of applications in various fields, including healthcare, finance, transportation, manufacturing,
and logistics. AI can assist in faster and more accurate decision-making, improve productivity,
enhance user experiences, and provide innovative solutions for complex problems and challenges.
The concept of artificial intelligence has evolved over the past 60 years since its inception in 1956.
AI technology has gone through six stages and three waves, namely: the initial development stage,
reflective development stage, application development stage, stagnation development stage, steady
development stage, and vigorous development stage, as illustrated in Figure 1.
Development history of artificial intelligence.
2.1.2 New Entrepreneurial Ventures
New entrepreneurial ventures refer to early-stage enterprises that prioritize innovation and creation
and seek rapid growth and high-risk returns by introducing new business models, products, services,
or technologies [6]. These ventures are typically led by entrepreneurs or teams who, through
innovative thinking and entrepreneurial spirit, aim to disrupt existing market patterns and create new
market opportunities. New entrepreneurial ventures often face high risks and uncertainties but also
possess significant growth potential. They strive for rapid market share expansion and seek
investment opportunities with high returns. The characteristics of new entrepreneurial ventures are
illustrated in Table 1.
Table 1. Typical characteristics of new entrepreneurs
Characteristic Describe
Innovation Introducing new business models, products, or technological
innovations to brin
g
new solutions to the market
High growth potential Pursuing rapid growth and scale expansion, with high market growth
rate and revenue
g
rowth potential
High risk Faced with various risks and uncertainties such as market, technology,
and finance, but also with correspondin
g
return opportunities
Flexibility and Agility Flexible organizational structure and quick decision-making
mechanism to adapt to market chan
g
es and rapid iteratio
n
Table 1 illustrates four main characteristics of new entrepreneurial ventures, including
innovativeness, high growth potential, high risk, and flexibility and agility. These ventures play a
vital role in driving economic growth, creating employment opportunities, fostering technological
1956 1960 1970 198
0

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innovation, and catalyzing social change. They not only have economic significance but also
contribute to the progress of society and the development of innovative ecosystems.
New entrepreneurial ventures can be classified based on various aspects such as their industry
focus, types of innovation, or stages of development. Table 2 presents several common types of new
entrepreneurial ventures.
Table 2. Different types of new entrepreneurs
Type Characteristic Include
Technology
startups
Develop and provide new technological
products or services based on technological
innovation
Software Development
Compan
y
Artificial intelligence
technolo
gy
startups
Biotechnology Company
Social media
and internet
companies
Based on the Internet and digital
technology, providing online social media
platforms, e-commerce services, online
content creation, etc
Social network platforms
E-commerce startup company
Online education platform
Gaming and
entertainment
companies
Focusing on game development, virtual
reality (VR) technology, entertainment
content creation, etc
Game Development Studio
Virtual reality technology
startups
Digital entertainment content
production compan
y
Green and
Sustainable
Enterprises
Addressing environmental and sustainable
development challenges, developing and
promoting environmentally friendly
technologies, renewable energy, etc
Solar Energy Company
Environmental technology
startups
Sustainable Agriculture
Compan
y
Health
Technology
Enterprise
Utilizing technology and innovation to
solve problems in the medical and health
sectors
Telemedicine startups
Health Data Analysis Company
Medical device research and
development enterprises
Cultural
creativity and
art enterprises
Based on the cultural and creative
industries, covering art, design, cultural
activities, and creative industries
Artwork platform
Design Studio
Cultural and creative startups
With the advancement of innovation and technology, various types of new entrepreneurial
ventures continue to emerge. As shown in Table 2, new entrepreneurial ventures primarily include
technology startups, social media and internet enterprises, gaming and entertainment companies,
green and sustainable development enterprises, health technology companies, and cultural and
creative arts enterprises. Technology startups are dedicated to technological innovation and the
development of tech products or services. Social media and internet enterprises provide online
platforms, e-commerce, and content creation. Gaming and entertainment companies focus on game
development and virtual reality technology. Green and sustainable development enterprises address
environmental issues and promote eco-friendly technologies and renewable energy. Health
technology companies apply technology to address challenges in the medical and healthcare fields.
Cultural and creative arts enterprises are based on the cultural and creative industries, encompassing
art, design, and cultural activities.
2.2 Theoretical Foundations of Business Model Design for New Entrepreneurial Ventures
A business model refers to the strategies and methods adopted by enterprises to create, deliver,
and capture value. It describes how an enterprise organizes resources, designs products or services,

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establishes partnerships, interacts with customers, and achieves profitability. The business model
encompasses aspects such as value proposition, target market, value delivery mechanisms, revenue
streams, and key partnerships [7].
Theoretical foundations for business model design in new entrepreneurial ventures encompass
three main aspects:
(1) Innovation theory plays a crucial role in the design of business models and the management of
transformations for new entrepreneurial ventures. It helps enterprises introduce new ideas, products,
services, or technologies and create unique business models to facilitate transformation and
development. Innovation theory provides enterprises with thinking tools, frameworks, and methods
to maintain competitiveness in rapidly changing market environments and achieve sustainable
innovation and growth. It inspires enterprises to challenge traditional industry models, seek new
market opportunities, and innovate their business models. Additionally, innovation theory is closely
related to the management of transformation in new entrepreneurial ventures, offering a mindset and
tools for transformation management. It assists enterprises in identifying and evaluating
transformation opportunities and effectively carrying out organizational change and resource
allocation. By applying innovation theory, new entrepreneurial ventures can design business models
more effectively, adapt to market demands, and achieve successful transformation management.
(2) The theories of efficacy and efficiency are of significant importance in the design of business
models and the management of transformations in new entrepreneurial ventures. Efficacy theory
focuses on how enterprises can effectively utilize limited resources to achieve desired objectives and
enhance their production, innovation, and execution capabilities. On the other hand, efficiency theory
emphasizes maximizing output under conditions of limited resources. In the context of business
model design, these theories can help enterprises optimize various aspects and enhance value creation
and resource utilization efficiency. In the realm of transformation management, efficacy and
efficiency theories provide frameworks for guiding enterprises in adjusting their organizational
structures, processes, and technologies to adapt to market demands. They assist enterprises in
identifying bottlenecks and opportunities for transformation and formulating corresponding strategies
to improve overall efficacy and efficiency. By applying the theories of efficacy and efficiency, new
entrepreneurial ventures can maximize resource utilization, enhance organizational performance,
adapt to market changes, and drive successful development.
(3) The theory of entrepreneurial ecosystems views entrepreneurship as a complex ecosystem that
encompasses elements such as entrepreneurs, enterprises, investors, government, and incubators.
These elements are interdependent and interact with each other, influencing entrepreneurial activities.
The entrepreneurial ecosystem is dynamic and evolves over time and in response to changing
environments, requiring constant adaptation and adjustment from entrepreneurs and enterprises. The
emergence of new entrepreneurs and enterprises, as well as the growth and exit of existing businesses,
collectively shape the developmental trajectory of the entrepreneurial ecosystem.
3. The Importance of Business Model Design and Transformation for New
Startups in the Era of AI-Driven Innovation
The rapid development of artificial intelligence (AI) technology has brought forth new business
opportunities while challenging the traditional business models and modes of development for
established enterprises. In this context, new startups need to adapt to the business landscape of the AI
era through continuous innovation and transformation. The design of business models and effective
transformation management are of paramount importance for startups as they enable them to seize
new business opportunities, enhance market competitiveness, and achieve sustainable growth. Under
the impetus of AI, startups must reevaluate their business models, contemplating how to leverage AI
technology to improve the efficiency and quality of their products or services while creating greater
business value. Additionally, startups must also pay attention to aspects such as data privacy and
security to avoid risks and vulnerabilities associated with the utilization of AI technology.

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Furthermore, startups need to consider how to transform their traditional business models into ones
that are better suited for the AI era. Thus, for new startups, both business model design and
transformation management are crucial.
4. Analysis of Business Model Design and Transformation Management for
New Startups in the Era of Artificial Intelligence
4.1 The Role and Impact of Artificial Intelligence on the Business Models of New Startups
Artificial intelligence (AI) plays an increasingly important role in enterprise transformation
management. On one hand, through data mining and analysis, AI can help businesses identify
potential opportunities and challenges, providing more accurate decision support. On the other hand,
AI technologies can optimize internal business processes, improving efficiency and reducing costs.
Furthermore, AI can enable businesses to achieve more personalized and targeted marketing,
enhancing customer satisfaction and loyalty. In terms of transformation management, AI can assist
companies in quickly adapting to market changes and new business models, facilitating
transformation and upgrading. Additionally, through AI technologies, companies can achieve more
precise talent recruitment and development, enhancing employee productivity and satisfaction. In
conclusion, AI holds significant importance and impact in enterprise transformation management and
is expected to become one of the key driving forces for business development in the future.
4.2 The Success Factors of Business Model Design and Transformation Management for New
Entrepreneurs Driven by Artificial Intelligence
In AI-driven startups, the success of business model design and transformation management relies
on technological innovation and application, user demand and experience, data-driven decision-
making, flexible organizational structure and culture, strategic partnerships and ecosystem
development, as well as continuous learning and innovation. Startups should focus on leveraging AI
technology to provide differentiated products or services that meet market demands and enhance user
experience. Data analysis and decision support are crucial for guiding decision-making and capturing
market trends. Strategic partnerships and ecosystem development help facilitate resource sharing and
market expansion. Continuous learning and innovation enable companies to maintain
competitiveness and adapt to market changes. The combined effect of these factors will help startups
achieve success in business model design and transformation management in the context of AI-driven
innovation.
5. Methods and strategies for innovating business models using artificial
intelligence technology
Methods and strategies for business model innovation using artificial intelligence technology
include:
(1) Data-driven business model innovation: Companies can utilize AI technology to collect,
analyze, and leverage large amounts of data to discover market trends, user needs, and behavioral
patterns. Based on this information, they can redesign their business models. By gaining a deep
understanding of the data, companies can uncover new business opportunities and growth points and
innovate their business models based on data insights.
(2) Personalization and intelligent services: With the help of artificial intelligence technology,
companies can provide personalized and intelligent products or services to meet individual user needs.
By analyzing user data and behavior patterns, businesses can offer customized recommendations,
suggestions, and services for each user, enhancing user experience and loyalty.
(3) Automation and intelligent business processes: By incorporating artificial intelligence
technology, businesses can automate and make their internal processes more intelligent, leading to

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improved efficiency and cost reduction. For example, leveraging machine learning and natural
language processing techniques can enable automated customer service and post-sales support,
reducing human workload and enhancing response speed.
(4) Creating new markets and value chains: Artificial intelligence technology provides
opportunities for businesses to explore new markets and create new value chains. By analyzing
market demands and trends and incorporating AI applications, businesses can uncover new business
opportunities, establish new market domains, and build entirely new value chains.
(5) Collaboration and innovation with ecosystems: Collaborating with other businesses, partners,
and innovation ecosystems is essential for driving business model innovation. Through partnerships,
companies can share resources, technology, and market channels, accelerating the innovation and
development of their business models.
(6) Continuous learning and innovation: Artificial intelligence technology is constantly evolving,
and businesses need to continuously learn and stay up-to-date with the latest technological
advancements. By embracing continuous learning and innovation, companies can maintain a
competitive advantage, continuously improve and optimize their business models, and adapt to
rapidly changing market demands.
6. Conclusion
In conclusion, we have discussed the role of artificial intelligence (AI) in the design of business
models and transformation management in startups. AI provides opportunities for data analysis,
decision support, and process optimization for businesses, while also driving business model
innovation and creating competitive advantages through differentiation. However, AI also brings
challenges such as data security and technology management. Therefore, startups need to develop
clear strategies and management measures, including technology integration, talent development, and
establishment of partnerships. In summary, AI provides opportunities for innovation and
transformation for startups, but subsequent success requires active adaptation and effective
management by the companies.
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