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HANDBOOK OF DIGITAL ENTREPRENEURSHIP
Handbook of Digital Entrepreneurship

Edited by
Mohammad Keyhani
Associate Professor of Entrepreneurship and Innovation, Haskayne School of
Business, University of Calgary, Canada
Tobias Kollmann
Professor of Digital Business and Digital Entrepreneurship, University of
Duisburg-Essen, Germany
Andishe Ashjari
Doctoral Candidate in Entrepreneurship and Innovation, Haskayne School of
Business, University of Calgary, Canada
Alina Sorgner
Assistant Professor of Applied Data Analytics, John Cabot University, Rome,
Italy, Research Affiliate, Institute of Labor Economics (IZA) and Research
Fellow, Kiel Institute for the World Economy (IfW Kiel)
Clyde Eiríkur Hull
Professor, Department of Management, Saunders College of Business,
Rochester Institute of Technology, USA

Cheltenham, UK • Northampton, MA, USA

© Mohammad Keyhani, Tobias Kollmann, Andishe Ashjari, Alina Sorgner, Clyde Eiríkur
Hull 2022

With the exception of any material published open access under a Creative Commons
licence (see www.elgaronline.com), all rights are reserved and no part of this publication
may be reproduced, stored in a retrieval system or transmitted in any form or by any means,
electronic, mechanical or photocopying, recording, or otherwise without the prior permission
of the publisher.

Chapter 3 is available for free as Open Access from the individual product page at www.
elgaronline.com under a Creative Commons Attribution NonCommercial-NoDerivatives 4.0
Unported (https://creativecommons.org/licenses/by-nc-nd/4.0) license.

Published by
Edward Elgar Publishing Limited
The Lypiatts
15 Lansdown Road
Cheltenham
Glos GL50 2JA
UK

Edward Elgar Publishing, Inc.

William Pratt House
9 Dewey Court
Northampton
Massachusetts 01060
USA

A catalogue record for this book

is available from the British Library

Library of Congress Control Number: 2022944500

This book is available electronically in the

Business subject collection
http://dx.doi.org/10.4337/9781800373631

ISBN 978 1 80037 362 4 (cased)

ISBN 978 1 80037 363 1 (eBook)

EEP BoX
Contents

List of contributorsvii

PART I INTRODUCTION

1 An introduction to digital entrepreneurship: concepts and themes 2

Mohammad Keyhani, Andishe Ashjari, Alina Sorgner, Tobias Kollmann,
Clyde Eiríkur Hull and Zahra Jamshidi

PART II DIGITAL ENTREPRENEURSHIP AND DEFINITIONS

2 What is digital entrepreneurship? Fundamentals of company founding

in the digital economy 27
Tobias Kollmann and Philipp Benedikt Jung

3 Eras of digital entrepreneurship: connecting the past, present, and future 49

Tobias Kollmann, Lucas Kleine-Stegemann, Katharina de Cruppe and
Christina Strauss

4 Exploring the field of digital entrepreneurship: a bibliometric analysis 74

Eusebio Scornavacca, Tobias Kollmann, Stefano Za, Lucas Kleine-Stegemann
and Christina Strauss

PART III DIGITAL ENTREPRENEURSHIP ECOSYSTEMS

5 Measuring the digital platform economy 91

Zoltan J. Acs, László Szerb, Abraham K. Song, Esteban Lafuente and Éva Komlósi

6 The regional impacts of digitalization of work on entrepreneurship in

the United States 121
Frank M. Fossen, Trevor McLemore and Alina Sorgner

PART IV DIGITAL ENTREPRENEURSHIP TECHNOLOGIES

7 Startup stacks: understanding the new landscape of digital

entrepreneurship technology 140
Mohammad Keyhani

8 Digital product-assisted learning: transforming entrepreneurial learning

with product usage analytics 161
Varun Nagaraj

v
vi Handbook of digital entrepreneurship

PART V DIGITAL ENTREPRENEURSHIP ADOPTION AND OUTCOMES

9 Punching above their weight class: assessing how digital technologies

enhance new and small firm survival and competitiveness 181
Franz T. Lohrke, Alexander B. Hamrick and Qiongrui (Missy) Yao

10 Digital adoption in micro and small enterprise clusters: a dependency

theory study in Kenya 199
Ben Mkalama, Giacomo Ciambotti and Bitange Ndemo

PART VI DIGITAL ENTREPRENEURSHIP AND FINANCING

11 Crowdfunding: a competency framework for creators 222

Andishe Ashjari

12 Backers: consumers or investors? Crowdfunding vs. traditional

financing as an optimal security design problem 236
Anton Miglo

13 Blockchain economy: the challenges and opportunities of initial coin offerings 256
Bennet Schierstedt, Vincent Göttel and Lisa Klever

PART VII DIGITAL ENTREPRENEURSHIP AND SOCIAL ISSUES

14 Agentifying the body algorithmic: digital entrepreneurial agency and

accountability gaps 272
Angela Martinez Dy

15 Digital entrepreneurship in a rural context: the implications of the

rural–urban digital divide 291
Paolo Gerli and Jason Whalley

16 Data are the fuel for digital entrepreneurship—but what about data privacy? 306
Wolfgang Koehler, Christian Schultz and Christoph Rasche

Index323
Contributors

Zoltan J. Acs, George Mason University, USA

Andishe Ashjari, University of Calgary, Canada
Giacomo Ciambotti, Università Cattolica del Sacro Cuore, Italy
Katharina de Cruppe, University of Duisburg-Essen, Germany
Angela Martinez Dy, Loughborough University, UK
Frank M. Fossen, University of Nevada, Reno, USA
Paolo Gerli, Edinburgh Napier University, UK
Vincent Göttel, Heinrich Heine University Düsseldorf, Germany
Alexander B. Hamrick, Auburn University, USA
Clyde Eiríkur Hull, Rochester Institute of Technology, USA
Zahra Jamshidi, University of Calgary, Canada
Philipp Benedikt Jung, University of Duisburg-Essen, Germany
Mohammad Keyhani, University of Calgary, Canada
Lucas Kleine-Stegemann, University of Duisburg-Essen, Germany
Lisa Klever, Twitter Inc.
Wolfgang Koehler, University of Potsdam, Germany
Tobias Kollmann, University of Duisburg-Essen, Germany
Éva Komlósi, University of Pécs, Hungary
Esteban Lafuente, UPC Barcelona Tech, Spain
Franz T. Lohrke, Auburn University, USA
Trevor McLemore, University of Nevada, Reno, USA
Anton Miglo, University of Glasgow, UK
Ben Mkalama, University of Nairobi, Kenya
Varun Nagaraj, SPJIMR, India
Bitange Ndemo, University of Nairobi, Kenya
Christoph Rasche, University of Potsdam, Germany
Bennet Schierstedt, Heinrich Heine University Düsseldorf, Germany

vii
viii Handbook of digital entrepreneurship

Christian Schultz, Victoria International University of the Applied Sciences, Germany

Eusebio Scornavacca, Arizona State University, USA
Abraham K. Song, Pepperdine University, USA
Alina Sorgner, John Cabot University, Italy
Christina Strauss (née Then-Bergh), University of Duisburg-Essen, Germany
László Szerb, University of Pécs, Hungary
Jason Whalley, Northumbria University, UK
Qiongrui (Missy) Yao, York College of Pennsylvania, USA
Stefano Za, Università Cattolica del Sacro Cuore, Italy
 PART I

INTRODUCTION
1. An introduction to digital entrepreneurship:
concepts and themes
Mohammad Keyhani, Andishe Ashjari, Alina Sorgner,
Tobias Kollmann, Clyde Eiríkur Hull and Zahra Jamshidi

INTRODUCTION

Today, it is almost impossible to find an aspect of our lives that has not been touched by
digitalization. Regardless of time and location, only having access to a computer (i.e., an
electronic device capable of storing and processing data) and the Internet are enough for us
to work, pay bills, rent or buy almost any goods or services, communicate, learn and even
build a business from scratch. According to the International Communication Union (ITU),
in the past decade, the number of individuals using the Internet has increased drastically from
2 billion in 2010 (29 percent of the world population) to 4.6 billion (59 percent of the popu-
lation) in 20201 (Figure 1.1). Furthermore, the share of households with at least one personal
computer at home increased from about 35 percent in 2009 to 47 percent in 20192 (Figure 1.2).

Figure 1.1 Individuals using the Internet

In the wake of this digital revolution, organizations are being transformed fundamentally
across various industries, from manufacturing and retailing to health care and education. The
current pandemic has further accelerated digital transformation to accommodate changes in
people’s behaviour. According to ITU, “in 2020, the first year of the pandemic, the number of

2
 An introduction to digital entrepreneurship 3

Figure 1.2 Share of households with a computer at home

[Internet] users grew by 10.2 percent, the largest increase in a decade.”3 As a consequence of
this behavioral change, consumers become accustomed to online everything, from shopping
and banking to education and dating.
Sparked by the COVID-19 pandemic, the digitalization of entrepreneurship has accelerated
along with the digitalization of everything else. A survey by McKinsey found that as a result
of the pandemic, companies have sped up the digitalization of their supply side and demand
side interactions by three to four years and have fast-tracked the share of digital products in
their portfolios by seven years (LaBerge, O’Toole, Schneider, & Smaje, 2020). The idea that
COVID-19 has pushed the world beyond a tipping point is perhaps best seen in the rapid
global transition to remote work. The number of job postings on the popular software industry
website Hacker News that mention the word “remote” has skyrocketed from less than 30
percent before the pandemic to about 70 percent going into 20224 (Figure 1.3). In the startup
world, many digital-focused business models proved to be essential in leading this transfor-
mation including startups providing solutions for remote work and video communication,
ecommerce, online grocery shopping, online gaming, EdTech, FinTech, and other Software as
a Service (SaaS) solutions.
If there was any doubt before the pandemic, it is now crystal clear that digital technology
has brought major change to business and entrepreneurship. But academic research on digital
entrepreneurship has lagged behind this change for several reasons. First, the allure of pres-
tigious “grand theory” that is elegantly generalizable across contexts has prevented many
researchers from focusing their research on issues specific to the “digital” context. This is
despite calls from prominent scholars to contextualize entrepreneurship research (Baker &
Welter, 2020; Zahra, 2007; Zahra, Wright, & Abdelgawad, 2014). Often, specific contexts
introduce nuances and complexities that require more context-specific theory building. For
example, the information technology industry has long realized that strategic issues such as
switching costs, lock-in, zero marginal costs, network effects, two-sided markets, versioning,
and standards wars are highly relevant to information goods and digital products (Shapiro &
Varian, 1999; Varian, 2001) but not covered by generic generalizable theories that are not
4 Handbook of digital entrepreneurship

Figure 1.3 Proportion of job postings on Hacker News that mention the word “remote”

attuned to the specific characteristics of the digital context. In either case, given the rate at
which digital is taking over the world (i.e., the rate of digital convergence), it is more and more
difficult to describe digital entrepreneurship as being about a specific “context.” Increasingly,
almost all entrepreneurship is digital in some form or other (Hull, Hung, Hair, Perotti, &
DeMartino, 2007).
Second, the rate at which digital technology is transforming entrepreneurship is so fast that
it is often difficult for researchers to keep up. The lengthy publication process of peer-reviewed
academic journals has barely changed and has perhaps become even lengthier and more dif-
ficult in recent years. It also takes time for substantial data to become available on emergent
phenomena, and for armchair-inclined academics not entrenched in the world of practice to
notice such phenomena and recognize their value as subjects of study. For example, the first
exploratory study of crowdfunding published in a major entrepreneurship journal came out
in 2014 (Mollick, 2014), a full five years after the launch of the Kickstarter platform. In such
situations however, insights on these emergent phenomena can often be found published much
earlier in lower-ranked academic journals, practitioner outlets, blogs and social media, which
are unfortunately often discounted or unnoticed by much of academia. In many cases these
early publications may even use different terminology to describe the phenomena compared to
the terminology that eventually becomes dominant (Kollmann, Kleine-Stegemann, de Cruppe,
& Then-Bergh, 2021).
This handbook is an effort to compile a diverse set of scholarly contributions to the liter-
ature on digital entrepreneurship in a way that provides an informative look into how digital
entrepreneurship research has evolved over the years, and where it stands today. The aim is to
provide a snapshot of many of the major themes in digital entrepreneurship research, highlight
the diversity of topics and contributors to this line of work, and emphasize practice-engaged
and practice-relevant works of academic scholarship on the topic. Furthermore, this handbook
aims to help digital entrepreneurs and would-be digital entrepreneurs understand the history
and theory of digital entrepreneurship while also sparking ideas for future research in digital
 An introduction to digital entrepreneurship 5

entrepreneurship by highlighting emergent phenomena, and new ways to approach research in

this broad area of study.
This introductory chapter aims to contextualize the remaining chapters by setting the stage
in terms of key phenomena and key theoretical developments in digital entrepreneurship
research. We highlight six themes in digital entrepreneurship research that serve as the organ-
izing framework for the chapters in this handbook. Within the discussion of these themes, we
provide brief summaries of each chapter and highlight the significance of their contributions.
We end this introductory chapter with a summary of the editorial process.

WHAT IS DIGITAL ENTREPRENEURSHIP?

There are many varieties of terms and definitions around the concept of digital entrepreneur-
ship that are prevalent in the literature, and there is some value in this variety. That is why
throughout this handbook we have followed a pluralist approach and have not attempted
to consolidate definitions or advocate for the superiority of any one definition over others.
However, here in this introduction to the handbook, it may be helpful to discuss the meaning
of digital entrepreneurship and some of the issues that have arisen in the literature around
attempts to define this concept.
First, the term “digital” itself typically refers broadly to the set of all technologies emanating
from the invention of computers and their ability to process data and information as electronic
signals. When analog signals are turned into digital ones, they are essentially decoupled from
their physical storage medium and can be replicated, transmitted, and processed with much
more flexibility, speed, and scale, and with much less boundaries from physical constraints
and geographic distance. Naturally, given that the communication of information is at the heart
of almost all processes of management, organization, and trade, it is no surprise that digitaliza-
tion would deeply impact everything about business and entrepreneurship.
In practice, “digital” mainly refers to software and Internet technologies and is largely
synonymous with the notion of Information Technology (IT). The reasons for why a term
like “digital” starts to become the prevalent parlance when other terms already exist (e.g.,
“electronic” or “online”) to describe the concept largely have little to do with research and
scholarship and are mostly a function of the natural ways in which language evolves in society.
For example, in the article “Eras of Digital Entrepreneurship – Connecting the Past, Present,
and Future” by Kollmann, Kleine-Stegemann, de Cruppe, and Then-Bergh (2021) on the
history of digital entrepreneurship (Chapter 3 in this handbook), the authors point out that up
until 2015 the terms “Internet entrepreneur, “e-entrepreneur” or “net entrepreneur” were more
popular labels for the concept that is now mostly called “digital entrepreneur.” The authors
provide some speculation about the reasons for this shift in terminology.
There are many narrow ways to define digital entrepreneurship, and often when the term is
used in a particular context, one of these narrower definitions is implied. For example, simply
creating digital products is a commonplace understanding of digital entrepreneurship in many
contexts. However, scholars have noted that many different aspects of entrepreneurship are
impacted by digital entrepreneurship to varying degrees in various contexts, and for this
reason broader definitions are preferred. For example, von Briel et al. (2021, p. 287) provide
one such broad definition as “creating new economic activities embodied in or enabled by
digital technologies.” Tackling definitional issues has been a major research theme in the
6 Handbook of digital entrepreneurship

digital entrepreneurship literature, as we discuss later in this chapter. In the article “What is
Digital Entrepreneurship?” (Chapter 2 in this handbook), Kollmann and Jung (2022, p. 39)
suggest that digital entrepreneurship “refers to establishing a new company with an innovative
business idea within the Digital Economy, which, using a digital platform (also referred to as
electronic platform) in data networks, offers its products and/or services based upon a purely
digital creation of value.”

KEY CONCEPTS AND DEVELOPMENTS IN DIGITAL

ENTREPRENEURSHIP RESEARCH

Entrepreneurship research has been an interdisciplinary field of study that has borrowed
heavily from more mature disciplines to build its toolkit of theories of concepts. Most prom-
inently, the fields of psychology, sociology, and economics are considered to be the main
sources of theoretical insight in entrepreneurship research (Davidsson, 2016; Landström,
2005). Within the management and organization disciplines, the field of strategic management
has been the one most in conversation with entrepreneurship (Hitt, Ireland, Sirmon, & Trahms,
2011; Keyhani, 2022; Meyer, 2009). Accordingly, many entrepreneurship scholars have
a background as trained sociologists, economists, or researchers of psychology or strategic
management.
However, with the exception of some concepts from economics, most of these “source dis-
ciplines” have had little to contribute to digital entrepreneurship research. That is why many
entrepreneurship scholars unfamiliar with the information systems literature may feel that the
conceptual toolkit of contemporary digital entrepreneurship research feels somewhat foreign
to them. Nambisan (2017) has taken an important step to rectify this situation by introducing
entrepreneurship researchers to a number of widely used theories and concepts in the informa-
tion systems literature that are relevant to digital entrepreneurship. Toward a similar aim, in
this section we briefly review an inevitably non-comprehensive and far-from-exhaustive but
hopefully useful set of key concepts and theoretical developments that have shaped the study
of digital entrepreneurship. Key concepts are emphasized in italic font.

Information Goods, the Nature of Data, and Artificial Intelligence

One of the earliest and most impactful lines of work relevant to digital entrepreneurship is the
literature on the economics of information goods (Shapiro & Varian, 1999; Varian, 2001).
Along with the widespread adoption of personal computers, some economists started to notice
certain peculiarities about the nature of software and digital products that completely upended
the traditional economic calculations relevant to the production and manufacturing of physical
goods. For example, the normal cost structure of information goods involves a constant fixed
cost and virtually zero marginal costs of production. This leads to enormous supply-side
economies of scale, which in turn gives rise of monopolies and intense competition to become
the monopolist. On the other hand, demand-side economies of scale also known as network
effects give rise to the critical mass phenomenon, and the importance of being the first to scale
in a new market (Arthur, 1988; Hoffman & Yeh, 2018). The importance of scaling leads to
the phenomenon of penetration pricing, which means subsidizing the demand side in order to
increase adoption (Katz & Shapiro, 1994).
 An introduction to digital entrepreneurship 7

A good review of this literature is provided in Varian (2001). Shapiro and Varian (1999)
popularized these ideas in their book Information Rules which had a noticeable impact on
the evolution of Silicon Valley, such that practices recommended by this literature including
price differentiation strategies, penetration pricing, bundling, increasing switching costs and
creating lock-in were widespread in the industry by the 2000s. Hal Varian was hired as Chief
Economist at Google in 2002.
In more recent years, the economists who studied information goods have turned their
attention to the economics of artificial intelligence and machine learning (AI/ML) as these
technologies gain center stage in the competition among the digital behemoths, for example
Google (Alphabet), Facebook (Meta), Apple, Microsoft, and Amazon sometimes referred to
as the “Frightful Five” (Manjoo, 2017) as well as geopolitical rivalry (especially among the
US and China). It is becoming increasingly clear that in competition over AI, data becomes
“the new oil” (Hirsch, 2014). However, data being a digital resource, is different from physical
resources such as oil in that it is what economists call a nonrival good (Romer, 1990). Using
it at any one time for any one application does not exclude it from any other use. However,
where the scarcity comes into play is in access to the data, excludability (Benkler, 2000), the
capabilities to model and process it, and to connect it to other data fruitfully. The cost structure
of these activities and data access will be key determinants of the extent to which entrepre-
neurs and startups can engage with AI technology (Varian, 2019).
In general, it is interesting to ask if the nature of the digital technologies involved makes
them the realm of competition between big players or if small entrepreneurial ventures will be
able to compete. As a rule of thumb, in applications where the fixed costs are high or the data
is difficult to access, the big players who already have access to the data and have the financial
capabilities will have the upper hand and entrepreneurs will find it hard to enter. Examples
include autonomous vehicles, virtual reality, Internet of things, and targeted advertising. This
is why some observers have noted that the pendulum of digital technology today favors the
big firms: “today’s new technologies are complicated, expensive, and favor organizations that
have huge amounts of scale and capital already” writes Jon Evans (2017) in Techcrunch. But
in applications where the fixed costs are low and data is readily accessible, more startups are
likely to arise. Examples include content generation and data analytics. The more that parts of
the value chain can be outsourced or accessed as a service, the more entrepreneurial firms can
enter and compete.
Current trends indicate an unprecedented ability to complete various tasks in digital value
chains with less effort, time and money, and outsource other aspects of digital value chains
by linking different software services together through API integrations. Developments along
this trend include the availability of no-code software development platforms like Bubble.
io, easy-to-use and easy-to-integrate database platforms like AirTable.com and Xano.com,
API integration platforms like Zapier.com and Integromat.com, sheet-to-app solutions like
GlideApps.com and Softr.io, and many other tools such as the ones discussed in the chapter
on Startup Stacks by Keyhani (Chapter 7 in this handbook). Recently, complex AI models
like GPT-3 by OpenAI.com have become available as a service, giving rise to a host of
startups competing to find the best applications for language models in SaaS products.
Examples include Copysmith.ai, HuggingFace.co, Latitude.io, OthersideAI.com, Deepset.ai,
and Blogely.com. These trends point to an increasingly modular architecture of digital prod-
ucts, which is a topic we turn to in the next section.
8 Handbook of digital entrepreneurship

Decoupling and Modularity

That fact that digitalization essentially decouples information from its physical medium acts as
a first principle from which many implications relevant to digital entrepreneurship are derived.
First, the digital object or digital artifact that exists solely as “bits” becomes an important unit
of analysis (Kallinikos, Aaltonen, & Marton, 2013). It may be produced, copied, packaged,
communicated, and consumed. It may be combined with or embedded in other digital artifacts
or physical devices. And in all of these things it is unbounded by the traditional constraints
of the physical world such as material scarcity and geographical distance. Varian (2010, p. 1)
reflects on how these properties of digital artifacts led to an unprecedented scale and speed of
combinatorial innovation with the rise of the Internet:

Why was innovation so rapid on the Internet? The reason is that the component parts were all bits.
They were programming languages, protocols, standards, software libraries, productivity tools
and the like. There was no time to manufacture, no inventory management, and no shipping delay.
You never run out of HTML, just like you never run out of e-mail. New tools could be sent around
the world in seconds, and innovators could combine and recombine these bits to create new Web
applications.

Because of theses properties, digital technologies bring an unprecedented level of scalability

to entrepreneurial opportunities, and allow digital businesses to leverage extremely fungible,
scale-free capabilities (Levinthal & Wu, 2010). However, while these capability and resource
bundles may be extremely fungible across scale, they are often focused on narrow scopes or
verticals. Giustiziero, Kretschmer, Somaya, and Wu (2021) refer to this phenomenon as hyper-
specialization and hyperscaling. They argue that it is driven by incentives and opportunities to
outsource complementary activities.
Baskerville, Myers, and Yoo (2020) point out that digital objects have two key properties
with profound implications: First, they are nonmaterial and exist only in the form of bits. This
means that humans can interact with them only through some sort of physical or device inter-
face, but they can be processed or interact with each other without such an interface. Second,
they are computed, meaning that they require the execution of algorithms to come into being.
This computed nature gives rise to the reprogrammable nature of digital objects, as well as
their indistinguishability from digital actions.
The relationship between digital objects and physical ones is interesting. The traditional
way to think about digital objects is that they are representations of some physical reality.
But in fact, digital technology often leads to an ontological reversal such that digital reality is
decoupled from or takes precedence over the physical reality (Baskerville et al., 2020). While
a regular vehicle in the physical world may be represented as a “blue dot” in navigation soft-
ware, an autonomous vehicle in the physical world is itself controlled by the digital artifact in
its navigation software. In other cases, the digital artifact may exist wholly independent of any
physical reality and yet may be just as meaningful and impactful on our lives as anything in
physical reality. Increasingly, more and more of the important and meaningful artifacts in our
lives are digital, and less and less are physical, giving rise to a “digital first” world and creating
opportunities for entrepreneurship in the metaverse (Park & Kim, 2022).
The flexible nature of digital artifacts allows for flexible levels of modularity, referring to
the extent to which digital functionality is packaged in smaller modules (Yoo, Henfridsson, &
Lyytinen, 2010). In modular architectures, smaller modules are decoupled from each other but
 An introduction to digital entrepreneurship 9

can interact with other modules through standardized interfaces, thereby allowing innovators
to experiment with different combinations of modules. On the other hand, integrated architec-
tures group a large system of functions into a closed package that optimizes the connection
among the modules for a specific combination but precludes alternative combinations of its
component functions. The trade-offs between the benefits and costs of modular vs. integrated
architectures is a prime example of the general trade-off between openness and control that is
a recurring theme in the study of technology (Broekhuizen et al., 2021; Ethiraj & Levinthal,
2004; Fu, Sun, & Gao, 2022).
Almost all Software as a Service (SaaS) tools today provide standardized interfaces through
documented Application Programming Interfaces (APIs) which allows them to be combined
with other software. The emergence of API connector hub tools such as Zapier.com and
Integromat.com in recent years has drastically increased the rate of combinatorial innovation
made possible by combining functionality from different software components on the web.
A host of new entrepreneurial opportunities have been created involving the patching together
of various SaaS functionalities in novel combinations. At the same time, when a number of
applications start to build on modular patchwork solutions, it often indicates an opportunity for
other entrepreneurs to build integrated solution alternatives. Examples of integrated solutions
that attempt to compete with modular ones include Kajabi.com in the online course manage-
ment category and Outseta.com in the membership management category of SaaS products.
However, even these integrated solutions are able to interact with other software through APIs.

Digital Business Models and Platforms

The concept of business models has undoubtedly been one of the key contributions of entre-
preneurship practice and scholarship to the management discipline. Widespread adoption of
frameworks such as the business model canvas (Osterwalder & Pigneur, 2010) have expanded
the meaning of business models to include a variety of elements such as value proposition,
market segment, supply channels and others. This has resulted in business models sometimes
being understood as more like a list of elements, whereas the main idea behind the concept is
for it to describe a mechanism, sometimes referred to as the revenue generation mechanism
(Chesbrough & Rosenbloom, 2002) or the profit formula (Johnson & Lafley, 2010). To
describe these mechanisms, it is common in the business model literature to provide taxon-
omies of various business model archetypes or analogies that help us better understand the
“formula.” Examples of these analogies include the razor & blade model, brokerage, advertis-
ing, freemium, pay-as-you-go, commission, referral, and subscription (Afuah & Tucci, 2003;
Gassmann, Frankenberger, & Csik, 2014; Johnson & Lafley, 2010).
Perhaps the most important aspect of digital entrepreneurship is how information processing
gains center stage in the value chain and business model (Kollmann, 1998). Digital technology
allows entrepreneurs and companies to implement new kinds of business models, have greater
flexibility in changing and innovating with their business models, and leverage business
models that take advantage of the particular properties of digital technology. As stated by
Afuah and Tucci (2003, p. 7):

An Internet business model … is the method by which a firm plans to make money long term using
the Internet. The Internet business model is the system—components, linkages, and associated
dynamics—that takes advantage of the properties of the Internet to make money. It takes advantage
of the properties of the Internet in the way it builds each of the components—choice of profit site,
10 Handbook of digital entrepreneurship

value, scope, revenue sources, pricing, connected activities, implementation capabilities, sustainabil-
ity, and cost structure—and crafts the linkages among these components. For example, the Internet’s
universality and time-moderation properties allow employees of a firm located in different parts of
the world to collaborate on product development, thus decreasing the time needed to bring a product
to market. They also allow retailers to stay open 24 hours a day to shoppers, in the privacy of their
homes, from different parts of the world.

Early in the life of the Internet, many had emphasized the opportunities for all kinds of disin-
termediation, envisioning that users would be able to use the Internet to interact directly and
cut off many of the middlemen of the pre-Internet era. While this has occurred to some extent
in some industries, to a large extent we have learned that various kinds of intermediary plat-
forms are still needed, and in fact while they may not look like the traditional intermediaries,
the Internet provides many lucrative opportunities for these kinds of digital business models
referred to as “platforms” to arise and profit on a massive scale. There are multiple reasons for
this, as for example outlined by Brousseau and Penard (2007, p. 82):

These new business models contradict the prediction of a massive disintermediation caused by
the strong development of digital technologies and of the Internet. Even if the Internet can reduce
coordination costs, intermediaries are still needed. First, matching demand and supply plans, then
performing transactions remains costly. Second, combining several digital goods to benefit from their
interoperation – as is the case when a content is processed by a software run on a technical interface –
is certainly much easier than it was in the past, thanks to standardized interfaces. However, it remains
resource and time consuming to guarantee effective interoperability between digital goods to benefit
from a value-added service. Third, while a profusion of information goods is available both on and
off-line, it remains challenging to guarantee a user access to the information or piece of knowledge
they need. Those who can provide knowledge should receive appropriate incentives. Potential users
should be guaranteed access. These together led platforms to emerge to facilitate coordination in
the production and marketing of information goods. Many of the Internet success stories – E-Bay,
Amazon, Google, Yahoo, Autobytel – have developed business models based on the concept of
platforms assembling components, then bundling them into packages that correspond to consumers’
complex and specific needs.

A burgeoning literature in economics has developed around analyzing the properties of

platform business models often under the label of two-sided markets or multi-sided markets
(Eisenmann, Parker, & Alstyne, 2006; Rochet & Tirole, 2006; Roth & Sotomayor, 1990;
Rysman, 2009) also referred to as “matching markets” (Abdulkadiroglu & Sönmez, 2013;
Demange & Gale, 1985). An interesting phenomenon studied in this literature is multi-sided
network effects where more than one of the sides being matched together through the platform
exhibits network effects, and there are not only same-side network effects but also cross-side
network effects at play. Careful analysis of the particular networks that operate in any given
platform can lead to insights on which side of the market could or should be subsidized by the
firm to optimize growth.
One of the most important issues in digital platform entrepreneurship is that in the presence
of same-side and cross-side network effects, there is a chicken-or-egg problem when trying to
attract users (Parker, Van Alstyne, & Choudary, 2016). Users on one side have little incentive
to join unless there are enough users on the other side, but the other side users also have the
same reservation. For example, not that many people would want to use Uber for rides if there
were not enough Uber drivers, but not that many people would want to become Uber drivers
if there were not enough demand. This chicken-or-egg problem is sometimes referred to as the
 An introduction to digital entrepreneurship 11

cold start problem (Chen, 2021) and finding ways to address it is one of the most important
challenges in digital platform entrepreneurship. Tiwana (2013) notes that most successful
multi-sided platforms start out as a supplier on one side of the market, and then evolve into
platforms only after a critical mass of adopters is reached.
Recently, industry observers have noted that traditional two-sided markets tend to rely on
commodified products and services and short-term transactions. A new breed of digital busi-
ness models referred to as “market networks” are attempting to innovate in this space by focus-
ing on n-sided markets that combine elements of marketplaces and social networks, giving
center stage to non-commoditized and more high-touch services, more professional profiles
and salient identities for users, and longer-term relationships between parties (Currier, 2015).
Examples of market network businesses include AngelList, HoneyBook.com and Houzz.com.
Many recent startups such as OnDeck (BeOnDeck.com) have been inspired by the idea of
market network business models (Yu, 2021).
The trade-off between openness and control surfaces in the study of platforms as well, for
example in the question of whether a platform should be compatible with competing platforms
(Rysman, 2009). In the case of smartphones, Android apps are not compatible with iOS and
vice versa, resulting in some lock-in effects that benefit Google and Apple. If they were com-
patible however, there would be other benefits and other costs at play and therefore the optimal
choice of the level of openness is not a trivial one.

Unboundedness, Experimentation, and Generativity

Nambisan (2017) characterizes the key impacts of digital technology on entrepreneurship in

terms of less bounded entrepreneurial initiatives (in terms of outcomes and processes) and less
bounded or less predefined entrepreneurial agency. One example of how digital technology
removes boundaries is the way in which it allows experimentation at much higher scales and
speeds through automation. While the entrepreneurship literature has long recognized the
importance of experimentation, the popularity of the lean startup method has really empha-
sized the idea of rapid experimentation and feedback elicitation (Blank, 2013; Blank & Dorf,
2020; Ries, 2011). Digital technology makes such lean startup techniques much easier in many
respects. In fact, it can be argued that in digital entrepreneurship, experimenting with ideas
takes precedence over starting and incorporating a business as a legal entity at the center of
entrepreneurship, with the key performance metric being the ability to discover and validate
customers. In effect, the lean startup methodology envisions startups as a search mechanism
for viable business models rather than full fledged organizations.
There are now a host of software tools available for various aspects of experimenting with
ideas in the digital context. For example, a number of tools specialize in automated A/B testing
of websites and digital products. A/B testing is a method of rapid experimentation with varia-
tions of product features on small sub-population samples to identify the optimal feature set for
the broader population or for various segments. The technique gained popular attention after
reports that Barack Obama’s 2008 presidential campaign had successfully used the technique
in their campaign emails and advertisements (Siroker & Koomen, 2013). Today, many digital
businesses use automated or semi-automated A/B testing and it has been shown to have posi-
tive effects on performance (Koning, Hasan, Fuqua, & Chatterji, 2021). Interestingly, Koning
et al. (2021) found that adoption of A/B testing is also associated with failing faster, thereby
reducing the costs of failure.
12 Handbook of digital entrepreneurship

Another prime example of how digital technology allows for the trespassing of traditional
boundaries is the leveraging of crowds in the form of crowdsourcing or crowdfunding. Other
than the obvious scale benefits, Tajedin, Madhok, and Keyhani (2019) delineate the important
knowledge benefits of leveraging crowds. In other words, crowd-based business models and
organizational techniques allow the firm to unchain and unburden itself from its own internal
knowledge constraints, by tapping into the knowledge distributed in the broader population.
Thinking in terms of problems and solutions, crowds are ideal for when the firm knows and
can articulate the problem well, but wants to reduce the boundaries of its search parameters in
the solution space. Most importantly, crowds allow firms to overcome “unknown unknown”
problems by allowing others external to the organization to drive the search for the solutions,
each using their own localized knowledge, and unchained from the knowledge boundaries of
the crowdsourcing firm.
In fact, Tajedin et al. (2019) point out that marketplaces are in many ways taking this same
phenomenon of unburdening the platform firm from the knowledge constraints of any one
individual or organization. Viewed in this light, two-sided markets can be seen as mechanisms
where both the search for problems and the search for solutions is delegated to crowds (one on
each side of the market), and “unknown unknown” problems are avoided on both sides. For
example, on smartphone app stores, the platform owner (e.g., Google or Apple) does not need
to know or try to find out all the problems people have that could be solved with apps, and also
does not need to know or try to find out what apps can solve those problems, let alone try to
build them. Both the problem side and the solution side are delegated to the market.
The observation that marketplaces like the app store can endogenously produce innovations
without direction from the platform leads Keyhani (2021) to refer to them as “generative
marketplaces.” The idea that dynamic market economies can act as endogenous innovation
machines has been explored by economists in the past (Baumol, 2002; Phelps, 2013, 2017;
Romer, 1990), but has rarely been viewed from the lens of generativity theory. The concept of
generativity as mainly developed by law scholar Jonathan Zittrain is a key notion in modern
information systems literature and the theories of digital technology. Generativity refers to
“a system’s capacity to produce unanticipated change through unfiltered contributions from
broad and varied audiences” (Zittrain, 2008, p. 70). Importantly, generativity is conceptualized
as a property of technology, not as an organizational method. Therefore, while the concepts
of “open innovation” (Chesbrough, 2003) and “user innovation” (Thomke & von Hippel,
2002; von Hippel, 1986) are about leveraging external knowledge and innovations from broad
and varied audiences (i.e., “crowds”), generativity is about automating these open innovation
processes by taking advantage of the features of the technology (Keyhani, 2022; Keyhani &
Hastings, 2021). Generativity can be embedded in a particular product (such as Microsoft
Excel) which allows its users to innovate with it on a massive scale, or it can be leveraged
through a marketplace mechanism like the app store. Importantly, the idea that a marketplace
can be designed for generativity encourages us to avoid viewing platforms and two-sided
markets as merely “matching” mechanisms. Matching is only one of their functions, and in
fact may not even be the most important function if the generation of innovations is the main
design objective of the platform. This is a key consideration for platform entrepreneurs.
 An introduction to digital entrepreneurship 13

KEY THEMES IN DIGITAL ENTREPRENEURSHIP RESEARCH

The Structure of this Handbook

In this handbook we have collected a range of research contributions covering many of the
major prevalent themes in digital entrepreneurship research. In this section we provide a brief
introduction to each theme, along with summaries of the handbooks in this chapter that con-
tribute to that theme. It should be noted that the diversity of research in digital entrepreneurship
is such that no brief introduction can do justice to the range of topics that have been covered,
and that no short list of themes such as this one can be truly comprehensive. The themes or
subheadings listed in this section mainly serve as the organizing structure of this handbook.
Inevitably, many chapters are relevant to multiple themes but for organizational purposes had
to be categorized under only one.

Digital Entrepreneurship Overview and Definitions

One of the key themes in digital entrepreneurship research has been to tackle definitional
issues, to clarify the meaning, and to delineate the boundaries of the concept relative to similar
notions and adjacent concepts. These efforts have had varying degrees of success. Von Briel
et al. (2021) outline some distinctions between the general notion of entrepreneurship, digital
innovation, and digital entrepreneurship, although the distinctions are not always convincing.
For example, they use the phrase “new economic activities” when describing entrepreneurship
and “new and improved products, processes, or services” when describing innovation, which
is arguably similar. Giones and Brem (2017) compare the notion of digital entrepreneurship
with that of technology entrepreneurship, and define the intersecting construct of “digital
technology entrepreneurship” which is a kind of entrepreneurship that builds on technological
knowledge as input and produces digital artefacts as output.
The extent to which the digital component influences a particular entrepreneurial initiative
may involve grey areas in terms of whether or not it surpasses a threshold that would allow it
to be labelled as “digital entrepreneurship.” Hull et al. (2007) take a deeper look at six different
aspects of a business that may involve varying degrees of digitalization: (1) digital marketing,
(2) digital selling, (3) digital offerings, (4) digital distribution, (5) digital interactions, and (6)
digital operations. Importantly, any business or entrepreneurial initiative may involve varying
degrees of digitalization in one or more of these aspects. Similarly, Steininger (2019) suggests
that digital technology can be either a facilitator of venture operations, a mediator of venture
communications, or an outcome of the venture such as digital products.
Three chapters in this handbook contribute to this theme. Chapter 2 titled “What is Digital
Entrepreneurship? Fundamentals of Company Founding in the Digital Economy” by Kollmann
and Jung challenges the idea that digital entrepreneurship is a new field, arguing that prior
work explains the digital entrepreneurship phenomenon. They present the emergence and
development of the digital economy based on information/communication technologies and
define distinctive characteristics of companies established in this context. According to this
chapter, the foundation of a new venture in the digital economy would rely on the managing of
the information, the digital value chain, and the value-oriented processing of the information.
In Chapter 3 titled “Eras of Digital Entrepreneurship: Connecting the Past, Present,
and Future” Kollmann, Kleine-Stegemann, de Cruppe and Strauss conduct a systematic
14 Handbook of digital entrepreneurship

literature review to analyze the roots and historical development of the term “digital entre-
preneurship.” The chapter identifies three eras in the terminological development of digital
entrepreneurship: Seed-Era, Startup-Era, and Expansion-Era, and investigates the evolution
and connection between nine different terms used for digital entrepreneurship through these
eras. Understanding how these terms have been used in the digital entrepreneurship literature
should help anyone interested in learning from its history. Note that this chapter is a reprint of
Kollmann et al. (2021).
In Chapter 4, “Exploring the Field of Digital Entrepreneurship: A Bibliometric Analysis”
Scornavacca, Kollmann, Za, Kleine-Stegemann, and Strauss analyze the literature on digital
entrepreneurship with a bibliometric approach. The authors find nine relevant terms for digital
entrepreneurship in the literature, noting that some keywords, such as “technopreneurship”
and “e-entrepreneurship” were mostly used before the rise of the term “digital entrepreneur-
ship.” They analyze the shape of the digital entrepreneurship literature over time, tracing the
21 keywords most often used on this topic to show the connections among studies over time.
This helps us gain a better understanding of the underpinnings of the current state of the digital
entrepreneurship field.

Digital Entrepreneurship Ecosystems

An ecosystem can be defined as “a purposeful collaborating network of dynamic interacting

systems that have an ever-changing set of dependencies within a given context” (Sussan &
Acs, 2017, p. 57). Given the desire of many policy makers, institutional and community leaders
around the world to turn their own institutions, cities, regions and countries into thriving
hotbeds for entrepreneurship akin to “the next Silicon Valley” (Victor & Greg, 2012) the idea
of entrepreneurial ecosystems has become a subject of intense study. There have been multiple
lines of research on the macro-level factors and institutions that shape an entrepreneurial eco-
system (Acs, Autio, & Szerb, 2014; Nelson, 1993; Porter, 1990), but the label of “ecosystem”
borrowed from biology has gained increasing favor in recent years. The term implies a meta-
phor of life; the idea that if the system is designed properly and all the right components are
in place, life will be born, the stale and inactive will turn into the dynamic and generative, and
the system will to a large extent work autonomously as if it has “a life of its own” thereafter.
Terms such as “self-organizing” or “self-sustaining” are often used to describe this property
(Nicotra, Romano, Del Giudice, & Schillaci, 2018; Sussan & Acs, 2017).
Extending the concept of ecosystems to the digital realm, a line of work in the literature has
started to discuss the notion of digital ecosystems comprised of both technological components
often termed digital infrastructure, and social components such as users. Combining the
notions of entrepreneurial ecosystems and digital ecosystems, Sussan and Acs (2017, p. 63)
define digital entrepreneurial ecosystems as “the matching of digital customers (users and
agents) on platforms in digital space through the creative use of digital ecosystem governance
and business ecosystem management to create matchmaker value and social utility by reduc-
ing transactions cost.” They suggest a framework for understanding digital entrepreneurship
ecosystems consisting of four elements: (1) digital infrastructure governance, (2) digital user
citizenship, (3) digital entrepreneurship, and (4) digital marketplace.
A commonly employed theoretical framework in digital entrepreneurship research is that
of the theory of affordances and constraints (Chemero, 2003; Ingold, 2018; Majchrzak &
Markus, 2013). Employing the language of affordances, Autio, Nambisan, Thomas, and
 An introduction to digital entrepreneurship 15

Wright (2018) argue that entrepreneurial ecosystems are unique from the notion of clusters
in the way they take advantage of digital affordances “by their emphasis on the exploitation
of digital affordances; by their organization around entrepreneurial opportunity discovery and
pursuit; by their emphasis on business model innovation; by voluntary horizontal knowledge
spillovers; and by cluster-external locus of entrepreneurial opportunities” (p. 72). Importantly,
while previous literature on cluster and agglomeration emphasizes the importance of space
and physical proximity, digital technology reduces this dependence on geographic distance
and alters the role of location in entrepreneurial ecosystems. In this sense the Silicon Valley
metaphor, given its reference to a specific location, may be a misleading one in thinking
about digital entrepreneurial ecosystems. In this vein, Elia, Margherita, and Passiante (2020)
view digital entrepreneurial ecosystems as virtually global and context-independent. On the
other hand, many other researchers continue to emphasize the role of cities and locations in
the development of digital entrepreneurial ecosystems (Du, Pan, Zhou, & Ouyang, 2018;
Geissinger, Laurell, Sandström, Eriksson, & Nykvist, 2019).
Within the ecosystem theme, Chapter 5 “Measuring the Digital Platform Economy” by Acs,
Szerb, Song, Lafuente, and Komlósi is an important and significant contribution to digital
entrepreneurship research. A key reason for this importance being that the chapter develops an
index that can be used in future empirical studies. The authors develop an integrated Digital
Platform Economy (DPE) index based on the intersection of Digital Ecosystem (DE) and
Entrepreneurial Ecosystem (EE), measuring this index for 116 countries. The DPE index
includes 61 indicators, 24 variables, 12 pillars, 4 sub-indices, and 1 super index. They then
make policy recommendations based on the country’s development (i.e., GDP), DPE Index,
and the balance between DE and EE scores. They find that in most countries the Digital
Entrepreneurial Ecosystem (DEE) score reflects the development of the country.
In Chapter 6, “The Regional Impacts of Digitalization of Work on Entrepreneurship in the
United States,” Fossen, McLemore, and Sorgner look at the effects of digitalization on labor
markets and entrepreneurship, with a specific focus on how different types of digital technolo-
gies, like Artificial Intelligence, shape the job market and entrepreneurial activities. They find
that, at least in the US, regional digital entrepreneurial ecosystems are strongly related to the
digitalization impact on the regional occupational structure. They also provide heat maps and
state rankings, which may be of use to digital entrepreneurs, policy makers aiming to develop
digital entrepreneurial ecosystems, as well as digital entrepreneurship scholars.

Digital Entrepreneurship Technology

Some of the major themes in digital entrepreneurship research have involved the underly-
ing technologies themselves. We can identify at least one macro-level sub-theme and two
micro-level sub-themes within this broader theme. First, at the macro level, a topic of interest
has been the dynamics of technologies over time. Building on previous theories of techno-
logical change (Abernathy & Utterback, 1978), the lifecycle of technologies (Levitt, 1965),
and disruptive innovation (Christensen, 1997), observers have begun to theorize how digital
technology changes these dynamics. For example, Downes and Nunes (2014) argue that while
traditional disruptive technologies started out as a cheap and simple alternative to incumbents
and gradually encroaching upon the value provided to the incumbent’s customers, new digital
platforms are able to launch with greater value and lower prices from the very beginning,
leading to a much faster pace of disruption.
16 Handbook of digital entrepreneurship

At the micro-level, one line of research focuses on how new technologies give rise to change
in industry dynamics and engender new opportunities. These studies typically focus on new
burgeoning industries and specific technologies. For example Laplume, Petersen, and Pearce
(2016) analyze the changes in global value chains sparked by the growth of 3D printing, and
Chalmers, Matthews, and Hyslop (2021) study how the rise of blockchain technology enables
new opportunities for music entrepreneurs.
Often specific technologies will be used to create services for all startups, thereby allow-
ing “technology entrepreneurs” to develop “entrepreneurship technology.” This is some-
times referred to as the “Startups for startups” phenomenon as noted by Paul Graham in
a YCombinator memo (Keyhani, Chapter 7 in this handbook). Hence it becomes important to
ask how the nature of all entrepreneurship is becoming increasingly digital and how digital
technologies are changing and supporting the entrepreneurial process for all entrepreneurs.
This is the main sub-theme focused on by the two contributions in this part of the handbook.
Chapter 7 in this handbook by Keyhani titled “Startup Stacks: Understanding the New
Landscape of Digital Entrepreneurship Technology” is an early exploratory study of entrepre-
neurship technology. The author is the first to define the term “entrepreneurship technology”
as the set of technological tools which support, improve and transform the entrepreneurship
process. The chapter lists, and classifies directories of software tools for startups, pointing
out the cost, time, and human resource savings that they enable. The author points out that
given this landscape of technologies, any entrepreneur attempting to launch a business without
taking advantage of these tools will be at a severe disadvantage.
In Chapter 8 “Digital Product-Assisted Learning: Transforming Entrepreneurial Learning
with Product Usage Analytics,” Nagaraj makes an important contribution to the lean startup
literature by asking “what if the product itself were designed to help in the feedback and
learning process?” The author discusses the impacts of digitization on the scale, speed, and
scope of entrepreneurial learning. Drawing on the entrepreneurial learning and lean startup
methodology literature, the chapter conceptualizes a framework for digital product-assisted
learning. Based on two fast-growing lean startup case studies involving the agile development
process, the paper proposes an enhanced Build–Measure–Learn process that facilitates digital
product-assisted learning. This process provides useful data and information to the entrepre-
neurial venture, leading to rapid and continuous learning and product innovation.

Digital Entrepreneurship Adoption and Outcomes

Given the role of digital technologies in supporting and enabling entrepreneurs and startups,
it becomes important to study how entrepreneurs make the decision to use or adopt certain
technologies and what are the outcomes of such decisions. For app entrepreneurs or startups
that develop apps within the platforms of other companies, a key adoption question is which
platform to choose in the first place. For example, if we want to develop a mobile game, we
have to choose whether we want to develop it for Android, iOS, other less popular platforms,
or multiple platforms. Intuitively, it would make sense that linking to more dominant plat-
forms increases the chances of success (Srinivasan & Venkatraman, 2018), but the costs and
benefits of developing exclusively for one platform rather than for multiple platforms are less
straightforward.
The impact of adopting specific tools or specific categories of tools is also an interesting
topic of study. The availability of data sources like BuiltWith.com allows researchers to
 An introduction to digital entrepreneurship 17

identify whether or not a particular website or SaaS startup uses a particular tool. Koning et
al. (2021) take advantage of this rich data source to study the impact of adopting A/B testing
technology. They find that relatively few firms have adopted this technology, but those that did
have enjoyed performance benefits on multiple metrics such as page views and new product
features.
Adoption of digital technologies also has broader societal level impacts that have been of
interest to researchers. Galindo-Martín, Castaño-Martínez, and Méndez-Picazo (2019) argue
that digital transformation returns digital dividends, referring to the broader development
benefits from using new technologies. In their study of 29 European countries, they find that
digital transformation stimulates and facilitates entrepreneurship, and entrepreneurship in turn
produces innovations that further digital transformation.
Two chapters in this handbook can be categorized within this theme. Chapter 9 by Lohrke,
Hamrick, and Yao titled “Punching Above Their Weight Class: Assessing How Digital
Technologies Enhance New and Small Firm Survival and Competitiveness” investigates
the effects of digital technologies on the challenges of newness and smallness faced by New
Ventures (NVs) and Small and Medium-sized Enterprises (SMEs), suggesting that the emer-
gence of digital artifacts, platforms, and infrastructures can enhance the position of NVs and
SMEs. The authors point out ways in which digital technologies can help entrepreneurs with
entrepreneurship, engineering, and administrative issues that historically have represented
critical challenges to these firms’ survival and growth.
In Chapter 10 by Mkalama, Ciambotti, and Ndemo titled “Digital Adoption in Micro and
Small Enterprise Clusters: A Dependency Theory Study in Kenya,” the authors investigate
the outcomes of digital technology adoption within micro and small enterprises in Kenya
through qualitative research and a multiple-case design approach. Analyzing the presence of
psycho-social, socio-economic, and technological capability factors, they found that adopting
digital technologies helped business owners grow their sales. Entrepreneurs use these technol-
ogies for advertising, opportunity identification, and data generation as well as accounting,
tracking, and communication. The chapter also finds that a lack of technical training and edu-
cation in information technology skills limits entrepreneurs’ adoption of digital technologies.

Digital Entrepreneurship and Financing

Although digital technology has given rise to new possibilities in the world of startup financ-
ing, digital entrepreneurs still make extensive use of traditional financing methods as well. The
commonplace process perhaps still reflects the mainstream financial life of a digital startup:
starting with funding from founders, friends and family, moving on to bank loans and credit
in conjunction with seed investment from business angels and other seed funds, followed by
further investment rounds from venture capitalists, and finally moving to an Initial Public
Offering (IPO) or acquisition.
Some of the ways in which the digital age has given rise to novel forms of financing are
reviewed in Klein, Neitzert, Hartmann-Wendels, and Kraus (2019). These include:
● Accelerators and incubators, many of which have now become important seed and
pre-seed investors. The Silicon Valley based Y Combinator founded by Paul Graham is
often considered a model in this space. The training and networking benefits provided by
18 Handbook of digital entrepreneurship

these organizations often exposes founders to leading edge best practices in digital entre-
preneurship beyond what is taught at most educational institutions.
● Crowdfunding, which is dominated by reward-based platforms such as Kickstarter but
is increasingly open to equity-based investment. A novel form of crowdfunding is based
on blockchain-based cryptocurrencies and Initial Coin Offerings (Adhami, Giudici, &
Martinazzi, 2018; Fisch, 2019). Peer-to-peer lending is also sometimes referred to as
lending-based crowdfunding, and is made increasingly easy and widespread with digital
platforms (Bachmann et al., 2011).
● Business angel groups and networks, enabled by digital platforms such as AngelList are
now able to operate in coordination whereas previously angel investors mostly operated
as individuals.
● Patent-based investment funds are a relatively novel form of financing where they invest
in startups that hold valuable patents or patentable inventions, or provide credit financing
based on such patents. These funds sometimes also provide expertise in commercializing
early-stage technology.

Some additional new forms of financing such as indie or bootstrap financing, private equity
platforms, and recurring revenue financing have been pointed out by Keyhani, Robinson,
Lehar, and Ashjari (2022). From the above, three contributions in this handbook focus on
crowdfunding and ICOs. Chapter 11 by Ashjari (2022) titled “Crowdfunding: A Competency
Framework for Creators” proposes a competency-based framework to define crowdfunding,
through its similarities with entrepreneurial activities, as a value creation process. These
competencies consist of opportunity, strategic, organizing, relational, conceptual, ethical,
digital, and narrative, categorized in pre-campaign, in-campaign, and post-campaign phases.
The digital and narrative competencies are new in this context. The overall framework helps
answer questions such as “who could be a capable crowdfunder?” or, for the practicing digital
entrepreneur, “what do I need to be able to do in order to be a capable crowdfunder?”
Chapter 12 titled “Backers: Consumers or Investors? Crowdfunding vs. Traditional
Financing as an Optimal Security Design Problem” by Miglo (2022) tackles the choice between
digital financing (e.g., crowdfunding) and traditional financing through a mathematical model.
The model incorporates aspects of the decision such as the presence of moral hazard problems
regarding the choice of production scale, asymmetric information about firm quality, and
market demand uncertainty. According to the model, a two-stage financing process involving
reward-based crowdfunding followed by loan financing is optimal for entrepreneurs. This is
particularly the case for digital entrepreneurs developing innovative or high-risk products.
Chapter 13 by Schierstedt, Göttel, and Klever (2022) titled “Blockchain Economy: The
Challenges and Opportunities of Initial Coin Offerings” provides a great introduction to ICOs,
which is the emerging phenomenon whereby startups are beginning to sell security in the form
of currency or utility tokens to a crowd of investors. The ICO form of financing and its chal-
lenges and opportunities for digital entrepreneurs are analyzed to provide a better understand-
ing of blockchain-based business models for digital entrepreneurs. Legal and regulatory issues
are the main challenges of raising funding through ICOs, and the main benefits include access
to financing in very early stages, low cost of raising capital, and high-speed transactions.
 An introduction to digital entrepreneurship 19

Digital Entrepreneurship and Social Issues

There are a multitude of issues relating to ethics, social justice, and environmental sustainabil-
ity that are relevant to digital entrepreneurship. Practitioners in the world of digital technology
as well as entrepreneurs often have an optimistic bend (Dunne, Clark, Berns, & McDowell,
2019; Dushnitsky, 2010; Hmieleski & Baron, 2009). This results in a sometimes-blind faith
and idealism that shapes their perspective about social issues. For example, the ideas that
digital technology can significantly reduce costs, remove physical barriers, and reward compe-
tence may overshadow the fact that these benefits still accrue differentially to advantaged vs.
disadvantaged segments of society. As pointed out by Dy, Marlow, and Martin (2017, p. 286):
“it is purported that the emerging field of digital entrepreneurship may act as a ‘great leveller’
owing to perceived lower barriers to entry, disembodiment of the entrepreneurial actor and
the absence of visible markers of disadvantage online” but that deeper analysis “reveals how
the privileges and disadvantages arising from intersecting social positions of gender, race and
class status are experienced” such that “offline inequality, in the form of marked bodies, social
positionality and associated resource constraints, is produced and reproduced in the online
environment.”
In a similar vein Fossen and Sorgner (2021) find that while digitalization is significantly
associated with entrepreneurial entry, this effect is mostly the result of high-skilled individ-
uals and employees in ICT occupations becoming entrepreneurs as opposed to low-skilled
individuals. Internationally, an increasingly large “digital divide” is being created between the
richer and poorer countries (Arendt, 2008; Murthy, Kalsie, & Shankar, 2021). Digital entre-
preneurship may also be a way to help sustainable entrepreneurship advance more quickly, but
again, the sustainable entrepreneurs may well be high-skilled, wealthy individuals from more
developed nations (Heinze, 2020; Pilgeram, 2011).
Both the theory of socio-materiality and the theory of affordances and constraints are useful
perspectives to apply in the study of social issues in digital entrepreneurship. Socio-materiality
emphasizes the idea that the social context of a technology is a key determinant of the entrepre-
neurial possibilities that may arise from the technology (Davidson & Vaast, 2010; Orlikowski,
2010). The theory of affordances and constraints reminds us that any technology that may be
enabling in some ways also comes with boundaries and constraints (Chemero, 2003; Ingold,
2018; Majchrzak & Markus, 2013) as most of the digital entrepreneurship literature has an
obvious bend toward affordances and opportunities, tending to neglect the dark side of digital
entrepreneurship (Berger, von Briel, Davidsson, & Kuckertz, 2021). This is not to say that the
study of social issues in digital entrepreneurship necessarily must always uncover a dark side.
For example, McAdam, Crowley, and Harrison (2020) find that for women in Saudi Arabia,
digital entrepreneurship is empowering, provides them with financial independence, social
status, an online “safe space,” and access to opportunities.
Three chapters in this handbook roughly fall into this theme of research. Chapter 14 by
Martinez Dy titled “Agentifying the Body Algorithmic: Digital Entrepreneurial Agency and
Accountability Gaps” provides a ground-breaking theoretical investigation of ethical issues
arising from human reliance on non-human agents in the context of digital entrepreneurship.
It examines the current status of rights and obligations for algorithmic agents as they manifest
in several roles, such as Oracle, Trader, Manager, and Enforcer, and explores means by which
to increase the possibility of algorithmic accountability and reduce their potential harm. Her
arguments encourage us to embrace the idea that digital technology expands the very nature
20 Handbook of digital entrepreneurship

of entrepreneurial agency, and opens our minds to the potential consequences of such an
expansion.
In Chapter 15, Gerli and Whalley (2022) study “Digital Entrepreneurship in a Rural
Context: The Implications of the Rural–Urban Digital Divide.” This chapter examines digital
entrepreneurship in rural areas and the digital divide in Italy and the UK. Access to superfast
broadband and the quality of Internet connection is critical for rural entrepreneurs. They argue
that training to increase the digital skills of entrepreneurs in rural areas can support rural
digital entrepreneurship and reduce the digital divide. The chapter also builds on the dynamic
interplay between access divide, skill divide, and digital entrepreneurship to provide ideas for
policymaking in support of digital entrepreneurship for rural areas.
Finally, Chapter 16 by Koehler, Schultz, and Rasche (2022) titled “Data are the Fuel for
Digital Entrepreneurship – But what about data privacy?” takes a deeper look at the signifi-
cance of data, data privacy, and privacy laws in today’s economy. Large digital platforms with
access to privileged data face increasingly serious questions of legitimacy from the public and
from governments. On the other hand, data privacy legislation creates business opportunities
for digital entrepreneurs in terms of providing solutions for enterprises facing this issue.

CONCLUDING REMARKS

This chapter has aimed to provide a brief introduction to the field of digital entrepreneurship
research and to position the remaining chapters of this handbook within some of the main
research themes in this literature. We have been fortunate to receive high quality contributions
from an eclectic and global group of scholars. Due to space limitations, the editorial team had
to be selective and after a detailed review process ultimately chose 15 chapters to include in
this volume. The included chapters are authored by scholars from institutions in 11 different
countries and three different continents. Together, they highlight and discuss a diverse set of
questions, contexts, theories, methods, and phenomena that is reflective of the diversity in the
broader digital entrepreneurship literature.
Scholars who engage in research in the field of digital entrepreneurship often sacrifice some
generality in exchange for context-richness and relevance to practical matters. This means that
unfortunately much of the material in this type of research may go obsolete faster than other
areas that are less embedded in such a rapidly changing context. On the other hand, this dyna-
mism is inherent in the context of rapidly advancing digital technologies and the major impact
they have on the work and life of everyone in the world. This sense of dynamism and advance-
ment imbued in the subject matter being studied, infuses digital entrepreneurship research with
a sense of forward-looking optimism, hope, and wonder about the possibilities that the future
will bring. We hope that most readers of this handbook will share with us this general sense of
positivity, even if it is qualified by a healthy dose of critical skepticism, as it well should be.

NOTES
1. Data source: https://​www​.itu​.int/​en/​ITU​-D/​Statistics/​Pages/​stat/​default​.aspx.
2. Data source: https://​www​.statista​.com/​statistics/​748551/​worldwide​-households​-with​-computer/​.
3. See https://​www​.itu​.int/​itu​-d/​reports/​statistics/​2021/​11/​15/​internet​-use/​.
4. Data source: https://​www​.hntrends​.com/​2021/​dec​-remote​-work​-trend​-still​-climbing​.html.
 An introduction to digital entrepreneurship 21

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 PART II

DIGITAL ENTREPRENEURSHIP
AND DEFINITIONS
2. What is digital entrepreneurship?
Fundamentals of company founding in the
digital economy
Tobias Kollmann and Philipp Benedikt Jung

INTRODUCTION

New Ventures play a key role in the social and economic development of a country and
are often based on technological innovations. The underlying idea is that each new start-up
represents a new market player that has a stimulating effect on competition and thus drives
economic momentum forward. At the same time, internal and external information and com-
munication processes at enterprises across almost every industry sector have been increasingly
supported by digital information technologies. These technologies (e.g. internet, interactive
television and mobile communications) have triggered the founding of numerous start-ups in
the Digital Economy. In this context, primarily young and innovative enterprises in the sector
of information and communication technologies have the economic function to identify and
realize innovation potentials and to transform them into competitive business models. Against
this background, the term “Digital Entrepreneurship” respectively describes the act of estab-
lishing new companies specifically in the Digital Economy (Kollmann, 2006, 2020; Matlay,
2004).
It is a positive development that the topic of Digital Entrepreneurship receives increased
attention (e.g. Ghezzi & Cavallo, 2020; Nambisan, 2017) as research in this important field
enhances knowledge. At this point, however, it must be noted that several recent studies mis-
takenly regard Digital Entrepreneurship as a newly emerging field (e.g. Beliaeva et al., 2019;
Kraus, Palmer et al., 2019; Kraus, Roig-Tierno et al., 2019). In so doing, these contributions
neglect previous research contributions on this topic, which clearly laid the foundation for all
subsequent considerations and discussions (Jones et al., 2021). Thus, the assumption that the
research field of Digital Entrepreneurship is a new phenomenon must be disagreed with. It can
rather be understood as a new common ground that merges the wording in this field, which
has previously generated fragmented designations. Before relabeling the research topic into
“Digital Entrepreneurship,” the substantive foundation was already covered using preceding
terms such as “Virtual-,” “Cyber-,” “IT-,” “Techno-,” “Online-,” “E-Commerce-,” “Internet-”
or, particularly often, “E-Entrepreneurship.” Hence, the roots of this field go back much
further. The chapter “Eras of Digital Entrepreneurship” in this handbook precisely outlines the
antecedents of the term Digital Entrepreneurship along with its historical development phases.
In the present work, we exemplify the true roots of Digital Entrepreneurship by pre-
senting the core of one of the major foundational articles in this field (see “Eras of Digital
Entrepreneurship” and “Exploring the Field of Digital Entrepreneurship” in this handbook).
The original article from Kollmann with the title “What is e-entrepreneurship? – Fundamentals
of company founding in the net economy” was published in 2006 in the International Journal

27
28 Handbook of digital entrepreneurship

of Technology Management and explains the different facets of the phenomenon, which
literature nowadays refers to as “Digital Entrepreneurship.” In the presented version of the
article, the term “Electronic” (in short “E-”) and the word “Net” is replaced by the now more
commonly used term “Digital.” Additionally, only outdated contextual descriptions about the
Digital Economy as well as references were updated. As these changes do not alter the content
of the article, but only its wording, we exemplify that true roots of Digital Entrepreneurship lie
further in the past than partially claimed.
It is therefore precisely the research-didactic and the research-historical goal that the follow-
ing update of the 2006 contribution (with a first revision in 2009 in the Handbook of Research
on Techno-Entrepreneurship; 2nd edition 2014) deliberately overlaps in content, except for
the wording. This is intended to show that the content considerations from the past also retain
their validity under the new terminology of a “digital entrepreneurship” and must therefore not
be disregarded under the new terminology. Thus, we are pleased to enrich the subject area of
Digital Entrepreneurship by shedding light on its relevant historical basis with updated sources
and examples.
The original article “What is e-entrepreneurship? – Fundamentals of company founding in
the net economy” (Kollmann, 2006) answers several questions, that were raised by the expan-
sion of the classical use of the term “entrepreneurship”:

● Which environment and which possibilities does the Digital Economy offer for new and
innovative entrepreneurial activities?
● What is different or what unusual features can be found in establishing companies in the
Digital Economy?
● What are the building blocks and phases of development involved in setting up a company
in the Digital Economy?

THE DIGITAL ECONOMY

The basis of the Digital Economy is formed by four technological innovations: telecommu-
nication, information technology, media technology and entertainment (the so-called TIME
markets). These innovations had, and continue to, significantly impact the possible ways
in which information, communication and transactions are managed (Kollmann, 2001).
According to BITKOM (2020), the associated German ICT sector in 2019 generated sales of
169.1 billion euros, demonstrating the importance of this field. Against this backdrop, business
start-ups are often based on technological innovations and play an outstanding role in the
social and economic development of a country. Information technologies in particular, have
enabled numerous business start-ups within the Digital Economy. With every new foundation,
a new market participant is born, which stimulates competition and thereby further advances
economic dynamics. The ICT sector heavily relies on small and medium-sized enterprises, as
specifically young and newly founded companies (start-ups in the young Digital Economy)
play a key role as innovation drivers (Kollmann, Jung et al., 2020). Empirical evidence
indicates that large, established companies in the ICT sector, oftentimes neglect a number
of innovation potentials (Kollmann et al., 2021). Young and newly founded companies have
the economic function of realizing such innovation potentials and converting them into mar-
ketable business models. Against this backdrop, the German Federal Ministry of Economics
 What is digital entrepreneurship? 29

and Energy (Bundesministerium für Wirtschaft und Energie, 2018) investigated this field
in its Digital Economic Monitoring Report and identified that nearly 6,000 ICT ventures
are founded (Digital Entrepreneurship) only in Germany every year. Not only in Germany,
but also in Europe and throughout the world, the dynamic environments of ICT ventures
take a critical role in in the economic function by realizing innovation potentials (Keil et
al., 2008; Kollmann et al., 2016). These findings further underline that we are talking about
a critical field encompassing one of the most important technologies of the present and future
(Kollmann, 2020).
Therefore, the increased support of business processes using digital systems takes center
stage in this chapter. There are a number of terms for this that can be identified (e.g. digital
business, digital commerce, information economics, network economics), which can, to some
degree, be used synonymously (Jelassi & Enders, 2005). It is easiest to structure and clarify the
terms, define their boundaries and field of application by using the shell model of the Digital
Economy, which will subsequently be described in more detail (see Figure 2.1).
The initial assumption in the shell model is the general development towards an information
society (see Figure 2.1). Since the beginning in the 1990s, innovative information technology
induced a structural change in both social and economic spheres especially through the digi-
talization of information and the networking of computers (Hagel & Singer, 1997; Tapscott,
1996). Whereas just a few years ago, computers and networks were reserved for only a few
specialists, today they are already an integral part of daily life: digital technologies and their
influence on the transfer of information are ubiquitous. The results of this development are
clear – innovative information technologies such as the internet/WWW, mobile telecom-
munications and interactive television (ITV). These technologies are changing the world as
radically as the steam engine, loom, railways and tractor once did (Pruden, 1978). The digital-
ization and spread of information via digital data pathways or networks serve as a pacemaker
for future economic growth that is comparable with the significance of the printing press in
the 15th century or motorization in the 20th century. The information society is respectively
characterized by the intensive use of information technologies and the resulting change from
an industrial to a knowledge society (Evans & Wurster, 1997). Analogously, from a global
economic point of view, there is an obvious shifting from the traditional economic sectors of
agriculture, production and (non-virtual or rendered) services towards the information industry
sector.
Against this background, one of the central characteristics of the post-industrial computer
society is the systematic use of information technology (IT) as well as the acquisition and
application of information that complements work-life and capital as an exclusive source of
value, production and profit. Information becomes an independent factor of production (Porter
& Millar, 1985; Weiber & Kollmann, 1998) and thus establishes the information economy (see
Figure 2.1). From a historical perspective, initially, only the product characteristics (quality)
and corresponding product conditions (e.g. price, discount) determined if a product was suc-
cessful (Kirzner, 1973; Porter, 1985). At that point, it was important to either offer products or
services to the customer that were either cheaper than (cost leadership) or qualitatively supe-
rior (quality leadership) to the competitor’s product. Thereafter, the first major successes, two
additional factors joined the scene–time (speed) and flexibility (Meyer, 2001; Stalk, 1988).
At this point, it was important to offer products/services at a certain point in time at a certain
place (availability leadership). Additionally, it became crucial to allow for customer-oriented
product differentiation of important product characteristics (demand leadership). Information
30 Handbook of digital entrepreneurship

Source: Based on Kollman (2006), p. 324.

Figure 2.1 The shell model of the Digital Economy

technologies have now created an environment in which information is more easily accessible
and can be increasingly used for commercial purposes. The source of a competitive advantage
will be determined in the future, as a result of the technological development presented here,
by achieving knowledge and information superiority over the competition (information lead-
ership). Those who possess better information about the market and their customers (potential
customers) will be more successful than the competition. Whereas information previously held
merely a supporting function for physical production processes, in the future it will become an
independent factor for production and competitiveness (Weiber & Kollmann, 1998).
The growing relevance of IT and the expansion of digital data networks have created a new
commercial/business dimension that can be called the Digital Economy (see Figure 2.1).
It is especially influenced by the area of digital business processes that are concluded over
digital data pathways (Kollmann, 2001; Taylor & Murphy, 2004; Zwass, 2003). Due to the
importance of information as a supporting and independent competitive factor, as well as the
increase in digital data networks, it must be assumed that there will be a division of the relevant
trade levels on which the world does business in the future (Weiber & Kollmann, 1998): in
addition to the real level of physical products and/or services (Real Economy), a digital level
for digital data and communication networks (Digital Economy) will evolve. The commercial
possibilities resulting from this development can be called, in this context, digital business (see
Figure 2.1), which means the use of digital information technologies for supporting business
 What is digital entrepreneurship? 31

processes in the preparation, negotiation and conclusion phases (Kollmann, 2001). The nec-
essary building blocks, including information, communication and transaction are in this case
transferred and respectively concluded between the participating trade partners over digital
networks (Kollmann, 2019c).
Three central platforms have been formed which serve as a basis for these digital business
processes in digital business (see Figure 2.1) that include the exchange of all three building
blocks (information, communication and transaction).
● A Digital Procurement (also referred to as E-Procurement) enables the digital purchasing
of products and services from a company via digital networks. This uses the integration
of innovative information and communication technologies to support and respectively
conclude both operative and strategic tasks in the area of procurement. An example for
a Digital Procurement platform is SAP Ariba. It offers a complete solution for the digital
transformation of the procurement process of companies (Kollmann, 2019b).
● A Digital Shop (also referred to as E-Shop) allows the digital sales of products and services
by a company using digital networks. This allows innovative information and communi-
cation technologies to be used in supporting and concluding the operative and strategic
tasks for the area of sales. An example for a Digital Shop platform is Zalando, which is
an online fashion shop. Zalando developed its own shop system under the name “Zalando
E-Commerce Operation System” (abbreviated to ZEOS) store system. According to the
company, “Zalando Technology” is the basis for all internal processes and forms the core
for all products and services (Kollmann, 2019b).
● A Digital Marketplace (also referred to as E-Marketplace) allows digital trade with prod-
ucts and/or services via digital networks. This represents the integration of innovative
information and communication technologies to support and conclude respectively the
matching process of the supply and demand sides. An example for a Digital Marketplace
platform is Opodo. The company provides a wide range of travel services on the internet.
Opodo’s goal is to offer a wide selection of flights, hotels and vacation packages at particu-
larly attractive and competitive prices by combining offers from different airlines, hotels,
and other participants at their Digital Marketplace (Kollmann, 2019b).

Certainly, it must be understood that these terms are subject to overlapping. As a result of
this, Digital Procurement can most certainly be offered as a marketplace solution. In addition
to this, two further platforms exist that are also attributed to the Digital Economy, which,
however, do not emphasize all three building blocks equally – but concentrate rather more
heavily on information and communication.
● A Digital Community (also referred to as E-Community) enables digital contact between
persons and/or institutions using digital networks. What occurs here is an integration of
innovative information and communication technologies to support the exchange of data
and knowledge. An example for a Digital Community platform is Instagram. This social
network with a focus on video and photo sharing offers an associated communication
exchange between community members.
● A Digital Company (also referred to as E-Company) enables digital cooperation between
companies using digital networks. This involves an integration of innovative information
and communication technologies to link together individual business activities to form
a virtual company that presents a bundled offer. An example for a Digital Company
32 Handbook of digital entrepreneurship

platform is Star Alliance, an aviation alliance of 26 airlines. One of the main goals of this
alliance is digital efficiency gains, for example, via coordinated scheduled flights with the
establishment of a global network.

In view of the topic area of establishing a company, it appears suitable to hereafter view the
entire field of the Digital Economy and, thus, all platforms, as a basis for new business ideas.
This builds upon the fact that website operators in the internet can generate income with all
platforms and, in doing this, establish new companies. Against this background, the following
definition can be determined (based on Kollmann 2006, p. 326):

The ‘Digital Economy’ refers to the commercial use of digital data networks, that is to say, a digital
network economy, which, via various digital platforms (also referred to as electronic platform),
allows the conclusion of information, communication and transaction processes.

THE DIGITAL VALUE CHAIN

With the establishment of the Digital Economy and the heightened importance of the factor,
“information,” new possibilities emerged with respect to how enterprises create value (for
further details see Amit & Zott, 2001; Lumpkin & Dess, 2004). An enterprise can create cus-
tomer value not only through physical activities on the real level, but also through the creation
of value on the digital level. The value chain of the Real Economy, represented by the first
case, is based upon the approach used by Porter (1985): the value chain divides a company
into strategically relevant activities and identifies physically and technologically differentiable
value activities (see Figure 2.2), for which the customer is prepared to pay. Value activities are,
according to this, those basic building blocks from which the company produces a “valuable
product” in the eyes of the customer. This product can then form the basis for establishing an
enterprise in the Real Economy (see Figure 2.2). In this model – a sequence of value generat-
ing or value increasing activities – the individual steps are analyzed in order to efficiently and
effectively structure and develop primary and supporting processes. Even here, information
is extremely important when striving to be more successful than the competition. Information
can be used to better analyze and monitor existing processes. The crucial point here is that
information has previously been regarded only as a supporting element, not however as an
independent “source of customer and/or corporate value.”
The value chain of the Digital Economy presented in the second example is based on the
approach proposed by Weiber and Kollmann (1998): through the newly created dimension of
information as an independent source of competitive advantage, value can be created through
digital business activities in digital data networks independent from a physical value chain.
These digital value added activities are, however, not comparable with the physical value cre-
ation activities presented by Porter (1985), rather they are characterized by the way in which
information is used. Such value activities might include, for example, the collection, sys-
temization, selection, composing and distribution of information (see Figure 2.2). A “digital
value chain” manifests itself through these specific activities of creating value within digital
data networks that originates in and impacts only the Digital Economy. The result: based on
this new value creation level, innovative business ideas evolve through the use of the various
platforms and new “digital products” are created. Customers are willing to pay for the value
 What is digital entrepreneurship? 33

created by this product and the product can form the basis for establishing a company in the
Digital Economy (see Figure 2.2).

Source: Based on Kollman (2006), p. 327.

Figure 2.2 The concept of the digital value chain in the Real versus Digital Economy

An example of the digital value chain can be seen in Autoscout24.de. In this Digital
Marketplace, car sellers and buyers deal in used cars offered over the internet. User value is not
necessarily just the used car. Value also rests in the provided overview, selection and mediation
functions of the information related to the car and its availability, regardless of temporal and
spatial restrictions. This “digital product” is made possible only through the use of information
technologies. The website autoscout24.de is therefore a company of the Digital Economy as
the creation of customer value only occurs at the digital level. This is similar to the example
of Amazon.com, in which for instance the object “book” does not create added value, but by
their processes enabling digital selection and ordering in a distinct and value adding way.
However, this is an information product (overview, mediation, transaction) and thus amazon.
com is a Digital Economy company with its Digital Shop. This does not mean that companies
such as Autoscout24.de and Amazon.com do not require real resources (personnel, logistics,
etc.). They also possess a real value chain, but it has a supporting role (see Figure 2.2) in order
to successfully offer the digital creation of value. These correlations do not apply to an offer
such as the one at Seat.com. In this case, value is created for the customer through the real
product “car” and the shop in the internet is “merely” an additional distribution channel. This
simplifies the ordering process, yet there is no independent value created for which the cus-
tomer would be willing to pay extra. The car is not purchased due to the company’s website.
34 Handbook of digital entrepreneurship

Its internet presentation plays a supporting role for sales as a part of the real value chain (see
Figure 2.2). Thus, Seat.com is not a company of the Digital Economy.

The Digital Creation of Value

Building upon the underlying value chain in the Digital Economy (see Figure 2.2), it must
also be determined what form of digital value is “created” in the eyes of the customer for
which he would be prepared to pay, that is, what makes an online offer attractive in the first
place (from the customer’s point of view). The most pertinent question for the company in the
Digital Economy (digital ventures) is the question (see Figure 2.3): what value is created for
the customer within the Digital Economy? In the example of the digital creation of value, this
might include the following aspects.

● Overview: the aspect that an online offer provides an overview of a large amount of infor-
mation that would otherwise involve the arduous gathering of information. By offering an
overview, the digital venture creates value through structuring.
● Selection: by submitting database queries, consumers can locate exactly the desired infor-
mation/products/services more quickly with an online offer and, thus, more efficiently. By
offering this function, the digital venture creates selection value.
● Concluding transactions: this aspect refers to the possibility created by an online offer to
design and structure business activities more efficiently and effectively (e.g. from the cost
aspect or payment possibilities). The digital venture creates, in this way, transaction value.
● Cooperation: this aspect deals with the ability, using an online offer, for various vendors or
companies to more efficiently and effectively interlink their service or product offers with
each other. By doing this, the digital venture creates matching value.
● Exchange: in this case, an online offer allows different consumers to communicate more
efficiently and effectively with each other. Through this, the digital venture creates com-
munication value.

Considering these aspects, it is certainly possible that a digital venture creates several dif-
ferent types of value and that both structuring value as well as selection and mediation value
are created. After the identification of the creation of value, the perspective changes to the
entrepreneur’s point of view. The question then remains (see Figure 2.3): how is this value
created? For the purpose of answering this question, the previously presented digital value
chain can once again be applied (see Figure 2.2). The digital value chain separates a digital
venture into strategically relevant activities in order to better understand cost behavior and rec-
ognize present and potential sources of differentiation. Thus, the digital value chain represents
respectively those value activities, which, for example, involve collecting, systemizing and
distributing information (see Figure 2.2). Through specific value activities such as these within
digital data networks, a “digital information product” is created that presents value for which
the customer is hopefully willing to pay. The digital value chain embodies therefore the total
value that is generated by the individual digital value activities plus the profit margin. Now,
those value activities within the value chain will be identified that are especially relevant for
the creation of value. These value activities, once identified, form, in turn, the basis of a digital
value creation process within a company (see Figure 2.3). Thereafter, real work processes
must be conceptualized to realize the digital process of value creation.
 What is digital entrepreneurship? 35

Source: Based on Kollman (2006), p. 329.

Figure 2.3 The digital creation of value

Should an idea be based upon, for example, dealing in used photo cameras in a Digital
Marketplace on the internet (founder’s point of view), there is a typical way in which value can
be digitally created (see Figure 2.3). This value creation is directly reflected in the resulting
added value for the user (customer view) and refers centrally to, in the example presented
here, the overview, selection and mediation functions. An example is that a supplier would be
prepared to pay especially for the mediation function, whereas the customer would be even-
tually willing to pay a fee for the overview function. In order to realize this creation of value,
companies use the value chain to identify particularly those value activities that form the core
of value creation (see Figure 2.3). In order to do this, information on the object must be first
collected; second, the location and the seller of the used camera must be determined and, in the
third step, systematically stored in a database. Using this database, information is then offered
to the potential buyers who can formulate a query using appropriate search mechanisms. If
a match is found through the query process, then the accompanying information pertinent to
the request is exchanged. If all of this occurs, the final product is a transaction. The digital
process of creating value, from the company’s point of view, is thus collecting information,
processing and transferring it.

The Digital Value Creation Process

The digital value creation process describes especially those information activities and/or
the sequence of information activities, which in total create added value for the customer.
This involves both the core and service processes. Core processes hold a true function in the
creation of value, whereas service processes support the business processes along the value
36 Handbook of digital entrepreneurship

chain. As a general rule, the digital value chain process begins with the input of information for
the digital venture. In order to provide the targeted added value (e.g. overview function), the
required information must first be gathered (e.g. who demands what at which level of quality
and who offers this?). In the next step, the information is processed internally such that it can
then be transferred on to the customer in the desired form as information output and in a way
that specifically adds value for that customer. This process can be called the digital value crea-
tion process and describes thus the core processes of most digital ventures. When considering
digital ventures, it is then possible to formulate a representatively typical digital value creation
process (Figure 2.3) (Kollmann, 1998):

● The first step is the acquisition of information, which involves gathering relevant data
that serves as information input for the additional creation of value. This results in the
collection of useful data stores. This step in the value creation process can also be called
information collection.
● The second step involves information processing which means the conversion of the col-
lected data stores into an information product for the customer. This step along the value
creation process can also respectively be called information processing.
● The third step involves the information transfer. This means actually implementing the
newly acquired or confirmed knowledge obtained from collected, saved, processed and
evaluated data for the benefit of the customer. The result is an output of information, which
creates value. This step in the value creation can also be described as the information
transfer.

It is important to recognize that it is not sufficient to go through the sequence of this – here
presented in its most ideal form – digital value creation process just once. Rather, it is the con-
tinual process of acquiring, processing and transferring information which is necessary. This
is even more essential, when the data – from which information can be drawn – is constantly
subject to change. Thus, the data must be continually checked so it remains current. Against
this background, several examples of the digital value creation process in the Digital Economy
are presented in Figure 2.4.

ESTABLISHING A COMPANY IN THE DIGITAL ECONOMY

If one takes a closer look at the new companies in the Digital Economy (digital ventures)
equipped with digital value chains and digital processes of value creation (Figure 2.4), there
are a number of noticeable, common traits with regard to the way the company was estab-
lished. Most often it is a so-called original company founding, meaning that a completely new
company is established without relying on any previously existing or available company struc-
tures. Additionally, one observes that these cases were most often so-called independently
established companies initiated independently by the company founders seeking self-/
full-time employment in the newly established company (Metzger, 2020). Furthermore, estab-
lishing the company was a means to securing one’s independent, entrepreneurial existence.
Finally, it can be seen that established digital ventures were most often innovative companies,
that is, not established to imitate an existing company. An innovative start-up presents a situ-
ation in which the initiating factors, in the classical sense proposed by Schumpeter (1983), are
combined in a new way. This new combination can involve material or immaterial factors. The
 What is digital entrepreneurship? 37

increasing importance of “information” as a significant factor in the competitive advantage

has recently increased particularly the significance of the immaterial factors (e.g. knowledge,
know-how, etc.). Due to this, a number of newly formed companies in the Digital Economy
are established consistently upon new knowledge-based and conceptually creative factors (the
way in which information is dealt with and processed in the context of digital value creation to
form a digital product (Figure 2.4).

Source: Based on Kollman (2006), p. 331.

Figure 2.4 Examples of the digital process supporting the creation of value in the
Digital Economy

In addition to having a digital product when establishing a digital venture, it was and is
necessary to have a digital management, that is, members of management who have specific
knowledge about the correlating factors within the Digital Economy. In this case, special
emphasis is placed on the combination of management and computer science (informatics),
to establish the company and guarantee the necessary technical processes. This is particularly
important considering that information can change very quickly and along with it the compa-
ny’s basis for the value creation activities in digital data networks. There is a further special
characteristic trait of the Digital Economy in addition to the digital value chain – namely that
this is a considerably new area of business and lacks the years of experience on which estab-
lished business sectors can rely. Accordingly, the digital creation of value and the business,
which it is based upon, are oriented especially towards future innovations and developments.
Furthermore, there is a high level of uncertainty on the customer side with respect to the
amount and the timely presence regarding acceptance of innovative information technolo-
gies (e.g. internet start-ups’ use of Digital Procurement (Kollmann, 2019c). The conditions
38 Handbook of digital entrepreneurship

outlined in such cases as presented here, underline the high level of risk involved with the
development of the Digital Economy and the influence this has over investments in this area.
This risk is countered, however, by the fact that the Digital Economy and its underlying
technologies represent a central growth sector and are therefore linked to numerous oppor-
tunities. This is seen in the continuing, rapid expansion and use of the internet in the USA
and Europe. For example, a continuing increase in the dissemination and use of the internet
in Germany is still ongoing (Kollmann, 2020). Almost nine out of ten Germans are now con-
nected to the internet. Around 72 percent of these are even on the internet every day, which
means that the possibilities of digital business processes have become almost commonplace
(Kollmann, 2019a). Similarly, 93 percent of the citizens of the United States make use of
the internet, and 77 percent indicate to have a broadband connection at home (Pew Research
Center, 2021). Further, the level of investments in information technologies is still quite high,
whereby two aspects that are particularly pertinent for new companies become very clear:

● information technologies require a certain amount of capital or funding for the initial
development and/or company,
● information technologies are subject to continual change and constant development thus
requiring subsequent investments.

In addition to the need for capital to develop the technology, additional investments for the
establishment of the new company in the Digital Economy are necessary (e.g. personnel,
organization, establishing a brand, sales, production, etc.).
This concludes the description of the basic conditions and requirements for establishing
a company in the Digital Economy. In particular, four central characteristic traits can be identi-
fied that clearly distinguish the process of establishing a business in the Digital Economy from
the “classical” company establishment in the Real Economy (see Figure 2.5):

● type of company established: a digital venture is often an independent, original and inno-
vative company established within the Digital Economy.
● establishing environment: a digital venture is characterized by enormous growth potential
and, yet, is also marked by uncertainty of its future development concerning the true
success of its information technology – technology that requires significant investments.
● reference for establishing the company: a digital venture is based on a business idea that is
first made possible through the use of innovative, information technologies. The idea itself
focuses strongly on “information” as a competitive factor within the Digital Economy.
● basis for establishing the company: a digital venture is based upon a business concept that
involves the digital creation of customer value offered on a digital platform of the Digital
Economy. It requires continual, further development and administration.

In view of these conclusions and based on the circumstances, the following questions arise
from the company founder’s point of view: what information do I need in order to create value
for a customer? What type of platform should I use to present this information? How can
I guarantee that my information product will remain attractive for the customer also in future?
How do I achieve this in a way so that my innovative company can grow independently? Due
to these questions, companies established in the Digital Economy tend to be heterogeneous
and more complex. They differ from companies established in the Real Economy in many
aspects. This justifies an isolated and separate approach to researching how companies are
 What is digital entrepreneurship? 39

Source: Based on Kollman (2006), p. 333.

Figure 2.5 The distinguishing characteristics of companies in the Digital Economy

established in the Digital Economy (digital venture). Against this background, the term
“Digital Entrepreneurship” can be defined as follows (based on Kollmann 2006, p. 333):

Digital Entrepreneurship refers to establishing a new company with an innovative business idea
within the Digital Economy, which, using a digital platform (also referred to as electronic platform)
in data networks, offers its products and/or services based upon a purely digital creation of value.
Essential is the fact that this value offer was only made possible through the development of infor-
mation technology.

The Success Factors

A number of studies have shown that, at first glance, success factors for establishing
a company in the Digital Economy do not particularly differ from those in the Real Economy,
although, one does find specific differences in the realization of and development of these
success factors that are directly dependent upon the particular conditions in the Digital
Economy. These differences will be presented in the following section and cover the areas of
management, product, market access, process, and finance.
The building block “Management” (see Figure 2.6) places emphasis on founders of the
company, who, through their personality and motivation, strongly determine the activities
of a digital venture. Studies on the influence of technical, social, and methodical skills and
capabilities possessed by business founders determined that these have a positive influence
on the successful realization of the activities involved with establishing a company (Bingham
et al., 2019). This also holds true with respect to the motivation of the founder or the team
of founders. A high stress limit, pressure to succeed, self-confidence and awareness of risk,
influence and characterize the actions during the sustainable phase of conception and thereaf-
40 Handbook of digital entrepreneurship

ter in the realization phase. Whereas creativity, on the one hand, and analytical and conceptual
thinking, on the other, dominate the first development phases of a new company, experience
in the digital industry, knowledge of the interrelated aspects of the Digital Economy and
real experience in operative management are increasingly the points that truly matter when
establishing a digital venture. In view of this, establishing a company in the Digital Economy
is very complex and the knowledge required to achieve this must be drawn similarly from the
areas of computer science, information management (study of information systems), business
administration, and entrepreneurship. Accordingly, the founders must possess competence and
know-how in all three of the following areas to a certain extent. This involves the following
aspects:

● Computer Science – the technological aspect of the Digital Economy makes it necessary
to have a substantial understanding and knowledge of technologies, systems, databases,
programming, and the architecture of the internet.
● Information Management – the technological basis, provided by computer science, must be
assessable with respect to its content and relevance for business issues. For this reason, it is
important to have knowledge in the areas of management information systems, IT security,
data warehousing and data mining or even digital payment systems. It is just as important
to understand fundamental platforms in the Digital Economy, as it is to have a sound
overview of current existing business models and possibilities of creating value digitally.
● Business Administration – at the business administration level, it is essential to have a solid
business knowledge. Topics which should be especially emphasized in connection with
this, include marketing, business organization, management, financing, or investments.

Seldom does one person possess all of these skills such that it is more often the case that
a digital venture was established by a team of founders (Kollmann, Hensellek et al., 2020;
Kollmann, Jung et al., 2020).
The building block “Product” (see Figure 2.6) refers to the configuration of the services and
offers of a digital venture. In this respect the digital product and/or service offered must be
specified and communicated based upon its digital added value. Thus, the essential question is
whether the customer needs the digital offer/service provided by the digital ventures based on
IT and, if so, is the customer willing to pay? Further, it is the aim of the company to achieve
added value for the customer through the realized output with digitally created value. At the
same time, it is also the company’s aim to assure its offer possesses a unique characteristic,
which differentiates it from the other competitors. In addition to this, most digital ventures
are dealing in new forms of business ideas and/or business models. From the customer side,
initially it takes some time to get acquainted or to acknowledge the effect provided as value
added that results from such new ideas and models. For this reason, a regular reconnection
with customers and users must take place because it is, in the end, customer acceptance that
determines if the digital business idea is a success or not (Kollmann, 2019c). Establishing
a business in the Digital Economy is, apart from the aforementioned, singled out by the fact
that a digital venture and its digital business idea must not only satisfy a need but also do this in
a superior way compared to existing solutions in the Real Economy. Thus, the need for books
is already fulfilled through real book shops, however, Amazon.com, with its Digital Shop,
can offer overview, selection and transaction functions creating additional digital value in the
marketspace (Figure 2.4).
 What is digital entrepreneurship? 41

Source: Based on Kollman (2006), p. 335.

Figure 2.6 Success factors of establishing a company in the Digital Economy

The building block “Processes” (Figure 2.6) refers particularly to the need for a newly
established company to quickly move out of that critical stage where its activities are informal
and uncontrolled. This applies especially to work, finance, and organizational processes,
which form a solid operative foundation in a newly established company. This essentially
means that core processes must be firmly established and harmonize with the evolving
company organization. Further, in this context it is also important that not too many activities
are initiated simultaneously. Otherwise, there is an ensuing danger that some of these activities
may not receive the full attention they require. Therefore, it is necessary to have a logical and
effective project and process management. When dealing with a digital venture, sophisticated
development and presentation of concrete workflows should be based on a model example of
the value creation process that was previously determined (Figure 2.3). The company’s busi-
ness processes can then be conceptualized in parallel to the digital process of value creation.
These business processes should be understood as activity bundles necessary for realizing the
value offer. They can be described as those targeted activities which are performed in a timely
and logical sequence and whose aim is directly determined by the company strategy (Hammer
& Champy, 1993). Business processes thus describe the realization of the digital process of
creating value with the help of digital resources within a digital venture.
Particularly in the Digital Economy, which is characterized by a high degree of virtualization,
the knowledge of concrete process flows is extremely important. Many business models in the
Digital Economy are based upon taking advantage of the “effects of economies of scale.” This
is possible only when a large number of users can be serviced by either very few or even with
just one basic process (e.g. at online auction houses). The complexity of value creation, espe-
cially if the creation of this value involves the participation of multiple companies, requires
Other documents randomly have
different content
 "Lemoncholly, am I? I'll lemoncholly you, you rascal, if you don't
just knock off and go fishing this afternoon. I shan't need you with
me."
He was half way to the house when he called back: "Bring me a
nice mess of trout, boy, and you'll see my insides, as you call'em, will
be all right. It's trout I need. Now mind!"
And Jerry was comforted.
 CHAPTER VII.—WHAT WOULD YOU
HAVE DONE?
It was a year later before the Rev. Griffith Davenport found
himself in a position to carry out, even in part, a long-cherished plan
of his. For some time past, he had been strengthening himself in the
belief that in the long run he would have to flee from the problem
that so perplexed him. That he would have to make one supreme
effort which should, thereafter, shield him against himself and
against temptation. This determination had cost him the severest
struggle of his life, and it had resulted in the rupture of several
lifelong friendships and in strained relations with his own and his
wife's near kinsmen. It had divided his church and made ill-feeling
among his brother clergymen, for it had become pretty generally
known and talked about, that the Rev. Griffith Davenport had
definitely determined to leave his old home and take his sons to be
educated "where the trend of thought is toward freedom" as he had
expressed it, and as his neighbors were fond of quoting derisively.
He had finally secured a position in connection with a small college
somewhere in Indiana, together with an appointment as "presiding
elder" in the district in which the college was located. He had
arranged for the sale of his property, and he was about to leave.
To those whose traditions of ancestry all center about one locality,
it costs a fearful struggle to tear up root and branch and strike out
into unknown fields among people of a different type and class; with
dissimilar ideas and standards of action and belief. To such it is
almost like the threat or presence of death in the household. But to
voluntarily disrupt and leave behind all of that which has given color
and tone and substance to one's daily life, and at its meridian, to
begin anew the weaving of another fabric from unaccustomed
threads on a strange and unknown loom, to readjust one's self to a
different civilization—all this requires a heroism, a fidelity to
conscience and, withal, a confidence in one's own judgment and
beliefs that surpass the normal limit. But, if in addition to all this, the
contemplated change is to be made in pursuance of a moral
conviction and will surely result in financial loss and material
discomfort, it would not be the part of wisdom to ask nor to expect
it of those who are less than heroic. In order to compass his plans
Mr. Davenport knew that it would be necessary to dispose of his
slaves. But how?
He hoped to take with him to his new home—although they would
be freed by the very act—several of the older ones and Jerry and his
little family. He knew that these would, by their faithful services, be
a comfort and support to his wife and of infinite use and advantage
to the children, whose love and confidence they had. To take all into
his employ in the new home would, of course, be impossible. He
would no longer have the estate of an esquire. At first, at least, he
must live in a small town. There would be no land to till and no
income to so support them. The house would no longer be the
roomy mansion of a planter. His income would be too meager to
warrant the keeping of even so many servants as they were planning
to take—and there would be little work for them to do. The others
must be disposed of in some other way. But how? They are yours,
my friend, for the moment. How will you dispose of them? What
would you have done?
"Free them and leave them in the state of their birth and of their
love where their friends and kinsmen are?" But you cannot! It is
against the law! If you free them you must take them away. Sell
them? Of course not! give them to your wife's and your own people?
Would that settle or only perpetuate and shift the question for which
you are suffering and sacrificing so much? And it would discriminate
between those you take and thus make free and those you leave
and farther fix in bondage, and the Rev. Griffith Davenport had set
out to meet and perform, and not merely to shift and evade, what
he had grown to look upon as his duty to himself and to them. It
was this which had burdened and weighed upon him all these last
months, until at last he had determined to meet it in the only way
that seamed to settle it once and for all. He would go. He would free
all of them and take them with him into the state of his adoption. He
would then give hired employment to those he needed in his
household and the others would have to shift for themselves. This
he prepared to do. Some of them would not want to go into a
homeless and strange new land. This he also knew. Pete was, as the
negroes phrased it, "settin' up to" Col. Phelps' Tilly. Pete would,
therefore, resist, and wish to remain in Virginia. Old Milt and his wife
had seven children who were the property of other people in the
neighborhood, and their grandchildren were almost countless. It
would go hard with Milt and Phillis to leave all these. It would go
even harder with them to be free—and homeless. Both were old.
Neither could hope to be self-supporting. My friend, have you
decided what to do with Milt and Phillis? Add Judy and Mammy and
five other old ones to your list when you have solved the problem.
Mr. Bradley had spoken to Griffith of all these things—of the
hardships to both black and white—and of the possible outcome.
Over and over during the year, when they had talked of the
proposed new move, he had urged these points.
"It seems to me, Mr. Davenport, that you are going to tackle a
pretty rough job. You say you will take all of them as far as
Washington, anyhow. Now you ought to know that there are no end
of free niggers in Washington, already, with no way to support
themselves. Look at Milt and Phillis and Judy and Dan, and those
other old ones in the two end cabins! They've all served you and
your father before you faithfully all of their lives, and now you are
proposing to turn them out to die—simply to starve to death. That's
the upshot of your foolishness. You know they won't steal, and they
can't work enough to support themselves. All the old ones are in the
same fix, and the young ones will simply be put on the chain-gang
for petty thefts of food before you get fairly settled out west. Lord,
Lord, man, you don't know what you are doing! I wish the old Major
was here to put a stop to it. You're laying up suffering for yourself,
you're laying up sorrow and crime for them, you are robbing your
children of their birthright, and of what their grandfathers have done
for them, you are making trouble among other people's niggers here
who hear of it, and think it would be a fine thing to be a free nigger
in Washington or Indiana—and what good is it all going to do? Just
answer me that? It would take a microscope to see any good that
can come out of it. It's easy enough to see the harm. Look at 'Squire
Nelson's Jack! He undertook to run off last week, and Nelson had
him whipped within an inch of his life. Yes, bad policy, and cruel, of
course, but that's the kind of a man Nelson is. Now your move is
going to stir up that sort of thing all around here. It does it every
time. You know that. What in thunder has got into the heads of
some of you fellows, I can't see. It started in about the time you
Methodists began riding around here. Sometimes I think they were
sent down here just for that purpose, and that the preaching was
only a blind." Mr. Davenport laughed. "Ha, ha, ha, ha! Bradley, you
are a hopeless case! If I didn't know you so well, I'd feel like losing
my temper; but—"
"Oh, I don't mean you, of course. I know you got to believing in
the new religion and got led on. I mean those fellows who came
down here and started it all when you were a good, sensible boy.
And how do they get their foolishness, anyhow? Your Bible teaches
the right of slavery plain enough, in all conscience, and even if it
didn't, slavery is here and we can't help ourselves; and what's more
we can't help the niggers by turning some of 'em loose to starve,
and letting them make trouble for both the masters and the slaves
that are left behind. I just tell you, Mr. Davenport, it is a big mistake
and you are going to find it out before you are done with it."
Griffith had grown so used to these talks and to those of a less
kindly tone that he had stopped arguing the matter at all, and,
indeed, there seemed little he could say beyond the fact, that it was
a matter of conscience with him. His wife's father had berated him
soundly, and her sisters plainly stated that, in their opinion, "poor
Brother Grif was insane." They pitied their sister Katherine from the
bottom of their hearts, and thanked God devoutly that their
respective husbands were not similarly afflicted. And, as may be
readily understood, it was all a sore trial for Katherine.
At last, when the manumission papers came, Katherine sent
LeRoy, her second son, to tell the negroes to come to the "big
house."
Roy ran, laughing and calling, to the negro quarters. "Oh, John,
Pete, Sallie, Uncle Milt everybody I Father says for all of you—every
single one—to come to the big house right after supper! Every single
one! He's got something for you. Something he is going to make you
a present of! I can't tell you what—only every one will have it—and
you must come right away after supper!"
"G'way fum heah, chile! What he gwine t' gib me? New yaller
dress?" inquired Lippy Jane, whereupon there arose a great outcry
from the rest, mingled with laughter and gibes.
"I know wat he gwine t' gib Lippy Jane! He gwine t' gib'er a swing
t' hang onter dat lip, yah! yah! yah!" remarked Pete, and dodged the
blow that his victim leveled at him. "New dress! Lawsy, chile, I
reckon he be mo' likely ter gib you a lickin' along 'er dat platter you
done bus' widout tellin' Mis' Kate!" put in Sallie, whose secure place
in the affections of the mistress rendered her a severe critic of
manners and morals in the "quarters." "Come heah, Mos' Roy,
honey, an' tell ole Une' Milt wat'e gwine t' git. Wat dat is wat Mos'
Grif gwine t' gib me? Some mo' 'er dat dar town terbacker? Laws a
massy, honey, dat dar las' plug what he fotch me nebber las' no time
ertal."
But Roy was tickling the ear of old Phillis with a feather he had
picked up from the grass, and the old woman was nodding and
slapping at the side of her head and humoring the boy in the
delusion that she thought her tormentor was a fly. Roy's delight was
unbounded.
"G'way fum heah, fly! Shoo! G'way fum heah! I lay dat I mash you
flat' fo' a nudder minnit! Sho-o-o!"
Roy and the twins were convulsed with suppressed mirth, and
Aunt Phillis slapped the side of her head with a resounding whack
which was not only a menace to the life and limb of the aforenamed
insect, but also, bid fair to demolish her ear as well. One of the twins
undertook to supplement the proceeding on the other ear with a
blade of "fox tail," but found himself sprawling in front of the cabin
door. "You trillin' little nigger! Don' you try none'er yoah foolin' wid
me! I lay I break yoah fool neck! I lay I do," exclaimed the old
woman in wrath. Then in a sportively insistent tone, as she banged
at the other side of her head, "Fore de good Lawd on high! twixt dat
imperent little nigger an' dis heah fly, I lay I'm plum wore out. Sho-
o-o, fly!"
Suddenly she swung her fat body about on the puncheon stool
and gave a tremendous snort and snapped her teeth at the young
master. "Lawsey me, honey, was dat yoh all dis long cum short? Was
dat yo' teasin' yoah po' ole Aunt Phillis wid dat fedder? I lay I gwine
ter ketch yo' yit, an' swaller yo' down whole! I lay I is!"
The threat to swallow him down whole always gave Roy the
keenest delight. He ran for the big house, laughing and waving the
feather at Phillis.
Great was the speculation in the quartets as to what Mos' Grif had
for every one.
"Hit's des' lade Chris'mus!"
"I des wisht I knowed wat I gwine t' git."
"Lawsey me, but I wisht hit was arter supper now!"
In the twilight they came swaying up through the grass—a long
irregular line of them. Jerry had his banjo. Mammy, Sallie's old
mother, carrieed in her arms the white baby. Little Margaret was her
sole care and charge and no more devoted lovers existed.
"'Et me wide piggy back, mammy," plead the child.
"Heah, Jerry, put dis heah chile on my back! Be mons'ous keerful
dar now! Don' yoh let dat chile fall! Dar yoh is, honey! Dar yoh is!
Hoi' tight, now! Hug yoah ole mammy tight! D-a-t-s de way.

"'Go down, Moses, away down in Egypt's lan'.

Go tell ole Pharoah, t' let my people go.'"
 Mammy began to trot and hum the tune for the child. The swaying
rhythm caught like a sudden fire in a field of ripened grain. Every
voice, old and young, fell into harmony, and Jerry's banjo beat its
tuneful way like the ripple of a stream through it all.
Mrs. Davenport stood by the window watching them as they came
nearer and nearer. Her face was sad and troubled. She looked up
into the clear twilight and saw one star peer out. She did not know
why, but in some mysterious way it seemed to comfort her. She
smiled through dim eyes at the child on mammy's back. Her
husband still sat by the table sorting over some legal-looking papers.
"Are those the manumission papers, father?" asked Beverly, taking
one up and turning it curiously.
"Yes."
Beverly glanced at his father. It seemed to him that the lines in his
face were very sad. The merry twinkle that always hid in the corners
of eyes and mouth were obliterated. Then was a settled look of
anxiety. He seemed older. Beverly was silent. He more nearly
understood what his father was doing than did even Katherine.
Presently he said: "Hear them sing!"
Mr. Davenport was staring straight before him into space. He
turned to listen.
"Happy, careless, thoughtless, unfortunate creatures," he said
softly, "and as free as you or I, this minute—as free as you or I—if
only they knew it;" then suddenly—"No, not that, either. They can
never be that so long as they may not stay here free, even if they
want to. I suppose I am breaking the law to tell them what I shall
to-night, but I can't take them away from their old home and friends
and not tell them it is for good and all—that they may not come
back. For good and all—for good and all," he repeated, abstractedly.
After a long pause he said, "Law or no law, I cannot do that. I must
tell them they are free before they go—and that they must say
good-bye, never to come back."
"Seems pretty hard, doesn't it, father? But then—but—don't you
think God was pretty hard on them when He—when He made them
black? Jerry is a gentleman, if—if he was not black."
"Griffith," asked Katherine from the window, "how do you suppose
they will take it? I'm afraid——"
"Take it! take it! Why, little woman, how would you or I take
freedom if it were given to us?" The thought cheered him and he
crossed the room and tapped her cheek with the papers. His face
beamed. "I'm prepared to see the wildest outbreak of joy." He
chuckled, and some of the old lines of mirth came back to his face.
"I'm glad Jerry brought his banjo. They will be in a humor for some
of the rollicking songs afterward. I think they would do me good too.
And you, you, little woman, you will need it too. You have been
brave—you have been my tower of great strength in all this. If you
had contested it, I'm afraid my strength would have given out, after
all." He put his arm around her. "But God knows what we can stand,
Katherine, and he tempers the trial to our strength. Thank God it is
over—the wont of it," he said, and drew her to him.
Suddenly this silent, self-controlled woman threw both arms about
his neck and sobbed aloud. "God help us to bear it, Griffith.
Sometimes I think I cannot! It is hard! It is hard!"
He stroked her hair silently.
"Mos' Grif, does yoh want us to come in er t' stay on de big
po'ch?" It was Jerry's voice. "Good-ebnin', Mis' Kath'rine I I hope yoh
is monst'ous well dis ebenin'. Thanky, ma'am, yes'm, I'm middlin'."
Mis. Davenport drew herself farther into the shadow, but she
heard the little groan that escaped her husband. She understood.
Her own voice was as steady as if no storm had passed.
"Open these large windows on to the porch, Jerry, and your Mos'
Grif will talk to you from here. Just keep them all outside. I liked
your songs. When Mos' Grif is done with you all, sing some more—
sing that one he likes so well—the one about 'Fun in de Cabin.'" "To
be sho', Mis' Kath'rine, to be sho'. Dat I will. What dat Mos' Grif
gwine ter gib us? Milt he 'low dat hit's terbacker, an' Lippy Jane she
'low dat hit's calicker, an' John he 'low dat—"
 With the opening of the low windows a great wave of "howdys"
arose and a cloud of black faces clustered dose to the open spaces.
The moon was rising behind them and the lamp on the table within
gave but a feeble effort to rival the mellow light outside. The master
was slow to begin, but, at last, when the greetings were over he
said, with an effort to seem indifferent, "You all know that we are
going away from here and that you are going, too; but—" He found
the task harder than he had expected. His voice trembled and he
was glad that Katherine put her hand on his arm. He shifted his
position and began again. "You have all heard of freedom." He was
looking at them, and the faces were so blandly, blankly vacant of
that which he was groping for—they were so evidently expecting a
gift of tobacco, or its like—that he omitted all he had thought of to
say of their new freedom and what it could mean for them, and
what it had meant for him to secure it for them, and at once held up
the folded papers. "These are legal papers. They are all registered at
a court-house. I have one for each one of you. These papers set you
free! They are manumission papers, and you are all to be free! free
—"
The silence was unbroken except for a slight shuffling of feet, but
the dire disappointment was depicted on every face. That was too
plain to be mistaken. Only papers! No tobacco! No calico! Nothing to
eat! The silence grew uncomfortable. They were waiting for
something for which they could give out the "thanky, Mos' Grif,
thanky, sir, I's mighty much 'bleeged t' you, I is dat!" in their own
hearty and happy way.
Griffith found himself trying to explain what these papers really
were. He chanced to open Judy's first. He would make an object
lesson of it. She had been his nurse, and was too old and rheumatic
to work except as the spirit of occupation urged her to some trifling
task. Griffith was reading the paper and explaining as he went. The
negroes looked from the master to Judy and back again until he was
done. She walked lamely to his side when he had finished and was
holding her freedom papers toward her. She held out her hand for it.
Then she tore it through twice and tossed it out of the window. Her
eyes flashed and she held herself erect.
"What I want wid yoah ole mannermussent papers? What I want
wid 'em, hey?" She folded her arms. "Me a free nigger! Me! Mos'
Grif, yoh ain't nebber gwine ter lib t' be ole enough t' make no free
nigger out ob ole Judy! What I fotch yoh up foh? Didn't I nus yoh
fum de time yoh was a teenchy little baby, an' wasn't ole Mis' and
yoah paw sas'fied wid me? What I done t' yoh now? What fo' is yoh
gwine ter tun me loose dat a way? Mannermussent papers!" she
exclaimed, in a tone of contemptuous wrath, "mannermussent
papers! Yoh can't mannermussent yoah ole Aunt Judy! Deys life lef
in her yit!"
It was done so suddenly. The reception of freedom was so utterly
unexpected—so opposed to what he had fondly hoped—that Griffith
stood amazed. Katherine motioned to mammy, who still stood with
the white baby in her arms. "Give me the baby, mammy. I will—"
"Mis' Kate," said the old woman, turning, as she pushed her way
through the room, "Mis' Kate, do Mos' Grif mean dat yo' alls is gwine
ter leabe us? Do he mean dat we alls is got ter be free niggers, wid
no fambly an' no big house an' no baby t' nus?"
She changed the child's position, and the little soft, white cheek
lay contentedly against the black one.
"'Cause, if dat's wat Mos' Grif mean, dis heah chile ob yoahs an'
ole mammy, deys gwine t' stay togedder. Dis heah mammy don't
eben tetch no ole mannermossent papers! Tar hit up yo'se'f, Mis'
Kate, kase dis heah nigger ain't eben gwine t' tetch hit. She's des
gwine ter put dis baby ter bed lak she alius done. Goodnight, Mis'
Kate! Good-night, Mos' Grif!"
She was half-way up the stairs, when she turned.
"Mis' Kate, sumpin' er a-nudder done gone wrong wid Mos' Grifs
haid. Sho' as yoh bawn, honey, dat's a fack! I wisht yoh send fo' yoh
paw. I does dat!" and she waddled up the stairs, with the sleeping
child held dose to her faithful heart.
 The reception of the freedom papers by the others varied with
temperament and age. Two or three of the younger ones reached in
over the heads of those in front of them when their names were
called, and, holding the papers in their hands, "cut a pigeon-wing" in
the moonlight. One or two looked at theirs in stupid, silent wonder.
Jerry and his wife gazed at the twins, and, in a half-dazed, half-
shamefaced way, took theirs. Jerry took all four to Katherine. "Keep
dem fo' me, please, ma'am, Mis' Kathrine, kase I ain't got no good
place fer ter hide'em. Mebby dem dare chillun gwine ter want'em
one er dese here days."
Not one grasped the full meaning of it all. It was evident that one
and all expected to live along as before—to follow the fortunes of
the family.
"Thanky, Mos' Grif, much 'bleeged," said old Milt, as he took his,
"but I'd a heap site a-rud-der had some mo' ob dat town terbacker—
I would dat, honey."
"Give it up for to-night, Griffith," said his wife, gently, as he still
stood helplessly trying to explain again and again. "You look so
white, and I am very tired. Give it up for tonight. It will be easier
after they have talked it over together, perhaps—by daylight."
She pushed him gently into a chair and motioned to Jerry to take
them all away. The faithful fellow remembered, when outside, that
she had asked him to sing, but the merry song she had named had
no echo in the hearts about him. All understood that they had failed
to respond to something that the master had expected. The strings
of his banjo rang out in a few minor chords, and as they moved
toward the quarters an old forgotten melody floated back—

O, de shadders am a deepenin' on de mountains,

O, de shadders am a deep'nin' on de stream,
An' I think I hear an echo f urn de valley,
An echo ob de days ob which I dream!

Ole happy days! Ole happy days!

Befo' I knew dat sorrow could be bawn,
When I played wid mos'er's chillun in de medder,
When my wuk was done a-hoein' ob de cawn!

Dose happy, happy days! Dose happy, happy days!

Dey'll come again no mo', no-o-o m-o-r-e, no more!

Ole mos'er is a-sleepin' 'neath de willow!

An' de apple blossoms' failin' on de lawn,
Where he used to sit an' doze beneath its shadder,
In de days when I was hoein' ob de cawn!

Ole happy, etc.

Dey'll come no mo' dis side de rlbber Jordan,

O, dey'll come no mo' dis side de golden shoah!
Foh de Chilian's growed so big dat deys forgot me,
Kase I'se ole an' cannot wok foh dem no mo'!

Ole happy, etc.

 CHAPTER VIII.—OUT OF BONDAGE.

"Look down. Say nothin'. Few words comprehends the whole."

The long, lank mountaineer stood leaning on his gun and looking
listlessly at the collection of bundles, bags, children, dogs, guns,
banjos, and other belongings of the Davenport negroes, as they
waited about the wagons, now nearly ready to start for "Washington
and the free States"—that Mecca of the colored race. It is true that
Lengthy Patterson disapproved of the entire proceeding,
notwithstanding his profound respect for, and blind admiration of
Parson Davenport, as he always called Griffith; but he had tramped
many miles to witness the departure, which had been heralded far
and wide. Lengthy's companion, known to his familiars as "Whis"
Biggs, slowly stroked the voluminous hirsute adornment to which he
was indebted for his name, "Whiskers" being the original of the
abbreviation which was now his sole designation—Whis stroked his
beard and abstractedly kicked a stray dog, which ran, howling, under
the nearest wagon.
"Hit do appear t' me that the Pahrson air a leetle teched in the
haid."
There was a long pause. The negroes looked, as they always did,
at these mountaineers in contempt.
Lengthy dove into a capacious pocket and produced a large home-
twisted hand of tobacco and passed it in silence to his companion,
who gnawed off a considerable section and in silence returned it to
the owner.
"Let's set," he remarked, and doubled himself down on a log.
Lengthy took the seat beside him, and gathered his ever-present
gun between his long legs and gazed into space. Mr. Biggs stroked
his beard and remained plunged in deep thought. That is to say, he
was evidently under the impression that he was thinking, albeit
skeptics had been known to point to the dearth of results in his
conversation, and to intimate that nature had designed in him not so
much a thinker as an able-bodied tack upon which to suspend a
luxuriant growth of beard. He was known far and wide as "Whis"
Biggs; and, if there was within or without his anatomy anything
more important, or half so much in evidence as was his tremendous
achievement in facial adornment (if such an appendage may be
called an adornment by those not belonging to a reverted type), no
one had ever discovered the foot. What there was of him, of value,
appeared to have run to hair. The rest of him was occupied in
proudly displaying the fact. He stroked his beard and looked wise, or
he stroked his beard and laughed, or he stroked his beard and
assumed a solemn air, as occasion, in his judgment, appeared to
require; but the occasion always required him to stroke his beard, no
matter what else might happen to man or to beast.
But at last the wagons pulled out. Amidst shouts and "Whoas!"
and "Gees!" and "G'langs!" Amidst tears and laughter and
admonitions from those who went, and those who were left behind,
the strange and unaccustomed procession took its course toward the
setting sun. The family drove, in the old Davenport barouche, far
enough behind to avoid the dust of the wagons. The long journey
was begun for master and for freedmen. Each was launched on an
unknown sea. Each was filled with apprehension and with hope. Old
friends and relatives had gathered to witness the departure, some to
blame, some to deprecate, and all to deplore the final leave-taking.
Comments on the vanishing procession were varied and numerous.
The two mountaineers listened in silence, the one stroking his beard,
the other holding his gun. Some thought the preacher undoubtedly
insane, some thought him merely a dangerous fanatic, some said he
was only a plain, unvarnished fool; some insisted that since he had
gone counter to public opinion and the law of the state, he was a
criminal; while a semi-silent few sighed and wished for the courage
and the ability to follow a like course. The first hours of the journey
were uneventful. There was a gloom on all hearts, which insured
silence. Each felt that he was looking for the last time upon the
valley of their love. Jerry drove the family carriage. As they paused
to lower the check-reins at the mill stream, Katherine bent suddenly
forward and shaded her eyes with her hands. "Griffith! Griffith! there
goes Pete back oyer the fields I I'm sure it is Pete. No other negro
has that walk—that lope. See! He looked back! He is running! I know
it is Pete!"
Mr. Davenport sprang from the carriage and shouted to the fleeing
man. He placed his hands to the sides of his face and shouted again
and again.
"Shell I run foh' 'im, Mos' Grif?" asked Jerry passing the lines to
his mistress. "I lay I kin ketch 'im, 'n I'll fetch' im back, too, fo' he
gits to de cross-roads!"
He grasped the carriage whip and prepared to start. The shouts
had served to redouble Pete's.
"He was your negro, Katherine, shall I let him go?" Griffith said in
a tired voice.
"Yes, yes, oh, Griffith, let him stay in Virginia if he wants to. We
can't have him with us—why, why not let him stay here?"
Griffith sighed. His wife knew quite well why; but she was nervous
and overwrought and feared resistance should Pete be brought to
bay—might he not fight for his freedom to remain where he might
not be free!
The wagons had all stopped. One of the twins, with ashen face,
came running back to report Pete's escape. "Mos' Grif, Oh, Lordy,
Mos' Grif! Pete he's run off! Pete———"
It was plain to be seen that the negroes were restless and
expectant. The tone and atmosphere of uncertainty among them,
the tearful eyes of some, and the sullen scowl of others quickly
decided Mr. Davenport. It was no time for indecision. Prompt action
alone would prevent a panic and a stampede. Katherine spoke a few
hasty words to him as he leaned on the carriage-door. He sprang in.
"Go on!" he shouted. "Go on! We can't all stop now. We must cross
the ferry tonight!" Then as a precaution he said to the twin: "Catch
up and tell Judy that 'Squire Nelson will get Pete if he tries to stay
here."
'Squire Nelson, the terrible!' Squire Nelson! who had called before
him a runaway boy and calmly shot him through the leg as an
example to his fellows, and then sent him to the quarters to repent
his rash act—and incidentally to act as a warning! 'Squire Nelson!
Did the manumission papers give those who stayed behind to 'Squire
Nelson? The negroes looked into each other's faces in silent fear,
and drove rapidly on.
An hour later, as they were looking at the glorious sunset, and
Griffith was struggling to be his old cheery self, Katherine said sadly:
"We are as much exiled as they, Griffith. We could never come
back." She choked up and then, steadying her voice, "If you think it
is God's will we must submit; but—but everything makes it so hard—
so cruelly hard. I am so afraid. I—no one ever—every one loved you
before, and now—now—did you see the faces, Griffith, when we
left? Did you see 'Squire Nelson's face?" She shuddered.
"Oh, is that all?" he exclaimed lightly. "Is that it, Katherine? Well,
don't worry over that, dear. We won't be here to see it, and—of
course he wouldn't like it. Of course it will make trouble among his
negroes for awhile and I am sorry for that. I don't wonder he feels—
I—"
"But, Griffith," she said nervously, "we are not out of the State yet,
and—and, Griffith," she lowered her voice to make sure that Jerry
would not hear, "can't the law do something dreadful to you for
leaving Pete here, free? What can——"
"Jerry, I wish you'd drive up a little. Get to the ferry before it is too
dark to cross, can't you?" said Griffith, and then, "Don't worry about
that, Katherine, Pete won't dare show himself for a day or two, and
besides-" He paused. The silence ran into minutes. Then he reached
over and took her hand and with closed eyes he hummed as they
rode, or broke off to point silently to some picturesque spot or to
whistle to a robin. There was a nervous tension on them all.
 "Mos' Grif, hit gwine ter be too late to cross dat ferry to-night.
Ain't we better stop at dat big house over dar?"
Mr. Davenport opened his eyes. He had been humming—without
time and with long pauses between the words—one of his favorite
hymns. He looked out into the twilight, "That's Ferris's old mill and
the Ferris house, isn't it, Katherine? Yes, Jerry, call to the boys to
stop. We will have to stay over. It is too late to cross now. That ferry
isn't very safe even in daylight."
The following morning, just before sunrise, there was a rap at the
door, and a servant came to say that Mr. Davenport was wanted.
Katherine was white with fear. She sprang from bed and went to the
window. There, in front of the house, stood Lengthy Patterson, gun
in hand, and beside him, sullen, crestfallen, and with one foot held
in his hands, stood Pete. Griffith threw open the window, and
Lengthy waited for no prelude. He nodded as if such calls were of
daily occurrence, and then jerked his head toward Pete. "Saw him
runnin'. Told him t' stop. He clim' out faster. Knowed you wanted
him." He pointed to Pete's foot. It was bleeding. There was a bullet
hole through the instep. "Few words comprehends the whole,"
added the mountaineer and relaxed his features into what he
intended for a humorous expression. Griffith turned sick and faint.
'Squire Nelson's lesson had been well learned even by this
mountaineer.
Pete was a dangerous negro to be without control, that was true.
As a free negro left him without ties, it was only a question of time
when he would commit some desperate deed, and yet what was to
be done? Lengthy appeared to grasp the preacher's thought. He
slowly seated himself on the front step and motioned Pete to sit on
the grass.
"Don't fret. Take yer time. I'm a goin' t' the ferry. Few words
comprehends th' whole," he remarked to Griffith, and examined the
look of his gun, with critical deliberation. When the wagons were
ready to start Jerry whispered to his master that two of the other
young negroes had run off during the night, and yet Mr. Davenport
pushed on. It was not until late the next afternoon when the dome
of the Capitol at Washington burst upon their sight that Griffith and
Katherine breathed free. The splendid vision in the distance put new
life and interest in the negroes. Their restlessness settled into a
childlike and emotional merrymaking, and snatches of song, and
banter, and laughter told that danger of revolt or of stampede was
over. Judy, alone, sulked in the wagons, and Mammy vented her
discontent on the younger ones by word and blow, if they ventured
too near her or her white charge. At last the Long Bridge alone
stood between them and a liberty that could not be gainsaid—and
another liberty for the master which had been so dearly and
hazardously bought.
The Long Bridge was spanned and the strange party drove down
Pennsylvania Avenue to the office of the attorney who had arranged
for their reception. The Long Bridge was past and safety was theirs!
Griffith glanced back and then turned to look. "Katherine," he said,
smiling sadly, "we have crossed the dead line. We are all safe!" He
sighed with the smile still on his lips.
"It is terrible not to feel safe! Terrible! Terrible!" she said in an
undertone, "not to feel safe from pursuit, from behind, and from
unknown and unaccustomed dangers near at hand—terrible!"
So accustomed had Griffith been to caring for and housing these
negroes, who, now that they were in the midst of wonders of which
they never had dreamed, clung to him with an abiding faith that
whatever should betide he would be there to meet it for them—so
accustomed had he been to caring for them that it had never
occurred to Griffith not do so, even now when they were no longer
his.
"Are the cabins ready?" he asked the attorney's clerk, and sent all
but Mammy to the huts which had been provided on the outskirts.
"Go along with this gentleman, children," he said. "Mammy will
stay with us, and after Jerry takes us to the hotel he will come and
tell you what else to do. Good-bye! Goodbye! Keep together until
Jerry comes."
 All was uncertainty; but it was understood by all that several of
the negroes were to go with the family and the rest to remain here.
Griffith had decided to take to his new home Jerry and his wife,
Ellen, and the twins; Mammy and Judy, and, if possible, Sally and
John. It was here, and now, that he learned the inhospitality of the
free states to the freed negroes.
"I intend to take several of them with, me and——"
"Can't do it," broke in the attorney, "Indiana's a free state."
"Well, I can take'em along and hire 'em, I reckon."
"Reckon you can't—not in Indiana."
"What!"
"I said you couldn't take'em along and hire em.
"I'd like to know the reason for that. I—"
"Law. Law's against it."
Griffith drew his hand across his face as if he had lost his power to
think.
"You can't take any of'em to Indiana, I tell you," said the attorney
insistently, and Griffith seemed dazed. Then he began again: "Can't
take them!" he exclaimed, in utter dismay.
"That's what I said twice—can't take them—none of them."
"But I shall pay them wages! Surely I can take my own choice of
servants into my own household if they are free and I pay them
wages I Surely—"
"Surely you cannot, I tell you," said the attorney, and added dryly,
"not unless you are particularly anxious to run up against the law
pretty hard." He reached up and took down a leather-bound volume.
He turned the leaves slowly, and Griffith and Katherine looked at
each other in dismay. "There it is in black and white. Not a mere law,
either—sometimes you can evade a law, if you are willing to risk it;
but from the way you both feel about leaving those two free niggers
in Virginia, I guess you won't be very good subjects for that sort of
thing—thirteenth article of the constitution of the State itself." He
drew a pencil mark along one side of the paragraph as Griffith read.
"Oh! you'll find these free states have got mighty little use for
niggers. Came here from one of'em myself. Free or not free, they
don't want 'em. You see," he said, slowly drawing a line down the
other side of the page, "they prohibit you from giving employment to
one! Don't propose to have free nigger competition with their white
labor. Can't blame 'em." He shrugged his shoulders.
Griffith began to protest. "But I have read—I thought—"
"Of course you thought—and you've read a lot of spread-eagle
stuff, I don't doubt. Talk is one of the cheapest commodities in this
world; but when it comes to acts—" he chuckled cynically, "s'pose
you had an idea that the border States were just holding out their
arms to catch and shield and nurture and feed with a gold spoon
every nigger you Southern men were fools enough to set free; but
the cold fact is they won't even let you bring them over and pay 'em
to work for you! That is one of the charming little differences
between theory and practice. They've got the theory and you've had
the practice of looking after the niggers! Your end is a damned sight
more difficult than theirs, as you'll discover, if you haven't already.
Excuse me, I forgot you were a preacher. You don't look much like
one." Griffith smiled and bowed. Katherine had gone to the front
window, where Mammy and the baby were enjoying the
unaccustomed sights of the street. Griffith and the lawyer moved
toward them.
"No, sir, your niggers have all got to stay right here in Washington
and starve or steal. You can't take'em to Indiana, that's mighty
certain. Why, when that Constitution was passed only a year or two
ago, there wern't but 21,000 voters in the whole blessed State that
didn't vote to punish a white man for even giving employment to a
free nigger. Public sentiment as well as law is all against you. You
can't take those niggers to Indiana—that's certain!"
"Dar now! Dar now! wat I done tole you?" exclaimed Mammy.
"What I done tole Mos' Grif 'bout all dis foolishness? Mis' Kate, you
ain't gwine ter 'low dat is you? Me an' Judy free niggers! Town free
niggers wid no fambly!" The tone indicated that no lower depth of
degradation and misfortune than this could be thrust upon any
human being.
"I's gwine ter keep dis heah baby, den. Who gwine ter take cahr
ob her widout me?" The child was patting the black face and pulling
the black ear in a gleeful effort to call forth the usual snort and
threat to "swaller her whole."
"Bless yoah hawt, honey, yoh ain't gwine t' hab no odder nus, is
yo'? Nus! Nus! White trash t' nus my baby! Yoh des gwine ter hab
yoh ole mammy, dat's wat!"
The attorney took Mr. Davenport and Katherine to an inner office.
It was two hours later when they came out. Both were pale and half
dazed, but arrangements had been made, papers had been drawn,
by which the nine oldest negroes were, in future, to appear at this
office once every three months and draw the sum of twenty-four
dollars each, so long as they might live. The younger ones must
hereafter shift, as best they could, for themselves. The die was cast.
The bridges were burned behind them. There was no return, and the
negroes were indeed, "free, town niggers," henceforth.
"God forgive me if I have done wrong," said Griffith, as he left the
office. "If I have done wrong in deserting these poor black children,
for children they will always be, though pensioned as too old to
work! Poor Mammy, Poor Judy! And Mart, and old Peyton!"
He shook his head and compressed his lips as he walked toward
the door, with a stoop in his shoulders that was not there when he
had entered. All the facts of this manumission were so wholly at
variance with the established theories.
Every thing had been so different from even what Griffith had
expected to meet. As they reached the door the attorney took the
proffered hand and laughed a little, satirically.
"Now I want you to tell me what good you expect all this to do?
What was the use? What is gained? It's clear to a man without a
spy-glass what's lost all around; but it's going to puzzle a prophet to
show where the gain comes in, in a case like this. If you'll excuse
the remark, sir, it looks like a piece of romantic tom-foolery, to a
man up a tree. A kind of tom-foolery, that does harm all around—to
black and to white, to bond and to free. Of course if all of 'em were
free it would, no doubt, be better. I'm inclined to think that way,
myself. But just tell me how many slave-owners—even if they
wanted to do it—could do as you have? Simply impossible! Then,
besides, where'd they go—the niggers? Pension the whole infernal
lot? Gad! but it's the dream of a man who never will wake up to this
world, as it is built. And what good have you done? Just stop long
enough to tell me that;" he insisted, still holding Griffith's hand. He
was smiling down at his client who stood on a lower step. There was
in his face a tinge of contempt and of pity for the lack of worldly
wisdom.
"I'm not pretending to judge for you nor for other men, Mr.
Wapley, but for myself it was wrong to own them. That is all. That is
simple, is it not?" The lawyer thought it was, indeed, very, very
simple; but to a nature like Griffith's it was all the argument needed.
His face was clouded, for the lawyer did not seem satisfied. Griffith
could not guess why.
"My conscience troubled me. I am not advising other men to do as
I have done. Sometimes I feel almost inclined to advise them not to
follow my example if they can feel satisfied not to—the cost is very
great—bitterly heavy has the cost been in a thousand ways that no
one can ever know but the man who tries it—and this little woman,
here." He took her hand and turned to help her into the carriage.
"Ah, Katherine, you have been very brave! The worst has fallen on
you, after all—for no sense of imperative duty urged you on. For my
sake you have yielded! Her bravery, sir, has been double, and it is
almost more than I can bear to ask it—to accept it—of her! For my
own sake! It has been selfish, in a sense, selfish in me."
Katherine smiled through dim eyes and pressed her lips hard
together. She did not trust herself to speak. She bowed to the
attorney and turned toward Mammy and the baby as they stood by
the carriage door.
 "I'm a-goin' wid yoh alls to de hotel, ain't I, Mis' Kath'rine? Dar
now, honey, des put yoah foot dar an' in yoh goes! Jerry, can't yoh
hol' dem hosses still! Whoa, dar! Whoa! Mos' Beverly, he radder set
in front wid Jerry, an' I gwine ter set inside wid de baby, an' yo' alls."
The old woman bustled about and gave orders until they were, at
last, at the door of the Metropolitan, where, until other matters were
arranged, the family would remain.
Strange as it may seem, to save themselves from the final trial of
a heartbreaking farewell, from protests, from the sight of weeping
children and excited negroes, three days later Mr. Davenport and his
family left by an early train for the west before the negroes, aside
from Jerry, knew that they were gone. And in the place of the
spectacle of a runaway negro escaping from white owners, the early
loungers beheld a runaway white family escaping from the galling
bondage of ownership!
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