User innovation and entrepreneurship in the virtual world: A study of Second Life residents

While prior studies have investigated factors, processes and pathways traversed in user innovation and user entrepreneurship within the real world, there is scant attention for user innovation and user entrepreneurship that take place within the virtual world. We report on an exploratory study of a select group of user innovators-entrepreneurs in Second Life, using virtual participant observation and in-depth interviews. Results suggest that the paths traversed by user innovators and user entrepreneurs in the virtual life broadly resemble those in the real life as reported in the literature. Interestingly, our study also suggests that Second Life as a virtual world breeds opportunities leading to entrepreneurial acts in the ‘real’ world as well as further opportunities in the Second Life. The virtual world itself, as a technological platform, also generates a range of opportunities. We formulate testable propositions and further link our insights to existing research on the drivers and pathways of user innovation and entrepreneurship in the ‘real’ world (i.e., the role of prior knowledge and networks), Austrian economics theory of entrepreneurial discovery, and creative collective theory.

► Virtual worlds are an important setting for user innovation and entrepreneurship.
► Trajectories of user innovation in the ‘virtual’ world resemble those in the ‘real’ world.
► Virtual user innovation breeds more entrepreneurial opportunities in the real life.
► Real life and virtual collaborative networks contribute differently.
► The currents limits of the virtual infrastructure spurs more user innovations.