Entrepreneurial opportunities have long been a focus for entrepreneurship scholars. Discussions have been on whether opportunities are created or discovered and how they come into existence. Little examination has been devoted to how the characteristics of the opportunities influence the way they are exploited. This paper aims to examine how characteristics of entrepreneurial opportunities shape their subsequent exploitations by entrepreneurial firms. Our theoretical starting point is the two distinct modes in which companies can exploit and commercialize a new opportunity: open or closed innovation.

Research on open/closed innovation has mainly examined the exploitation of opportunities from the perspective of how characteristics, capabilities and strategies of firms influence the choice of open or closed innovation mode. Scarce research has been devoted to understanding how the nature of the opportunity itself influence this choice. Opportunities can vary in several dimensions, including their novelty, source, knowledgebase, and relatedness to other firm activities. We propose that the characteristics of the opportunity influence the mode of exploitation chosen by the firm.