Explicating the Mechanism of BOP Ventures:An Architectural Innovation Perspective

This paper investigates the precise mechanism adopted by some firms to enter and sustain in challenging, non-remunerative and fragmented markets like the Bottom of the Pyramid. Contrary to the received wisdom of a predominantly philanthropic orientation coupled with moderate profits, this paper argues that such ventures were motivated to revisit the cost structures of the venturing firms in an effort to become cost competitive in the conventional markets. To substantiate the above argument, a content analysis was performed on the published cases of firms operating at the Bottom of the Pyramid. The analysis revealed the adopted mechanisms and the possibly accrued economic benefits as a consequence of the choice of the mechanism, the same being reported in this paper.