Drinks-Up! The Pitfalls of Digital Innovation

In July 2016, in Philadelphia, a group of aspiring entrepreneurs had developed a proof-of-concept prototype for the Drinks-Up! mobile drinks-ordering app, a digital innovation designed to provide a better bar experience. The team had received an investment proposal that included a plan for app development and a partnership opportunity from the potential investor’s company, and they were facing an investment decision: Was an agreement that would see the investor develop the app the right option to develop Drinks-Up!? If not, how much time and sweat equity was this really going to take? Was Drinks-Up! truly a disruptive innovation that was worth the risk?

This case is designed to discuss the topics of digital innovation and entrepreneurship for undergraduate or graduate classes in information systems, marketing, strategy, and entrepreneurship. The case provides an overview of the bar industry, describes the opportunities and business model of a proposed digital innovation, and then details the financial and social challenges of pursuing the opportunity. By completing the case and answering the assignment questions, students will do the following:<ul><li>Discuss the challenges of creating a start-up that focuses on digital innovation.</li><li>Understand the technical, financial, and marketing aspects of creating a start-up.</li><li>Understand the “systems thinking” underpinnings of digital innovation.</li><li>Discuss and evaluate the different forms of disruptive innovation.</li><li>Analyze the costs and benefits of using external resources such as angel investors and software development vendors.</li><li>Understand the societal pressures and life-situation challenges associated with start-ups.</li></ul>

• Systems Thinking, Disruptive Innovation, Societal Pressures, Technology Challenges