Examining Relational Capital, Structure Embeddedness, and Open Innovation in Indonesian Business Incubators and Startups

Despite the growing role of business incubators in fostering digital startups in emerging economies, the mechanism through which business incubator characteristics, specifically relational capital and structural embeddedness, influence startup innovation performance remains underexplored, particularly in the context of open innovation practices. This study examines how relational capital and structural embeddedness of business incubators affect the innovation performance of digital startups in Indonesia, with open innovation as a moderating variable. Using a cross-sectional survey design, data were collected from 201 startup owners or managers in Jakarta, West Java, and Banten. Partial Least Squares Structural equation modelling (PLS-SEM) was employed to test the hypothesized relationship. The results indicate that relational capital significantly enhances both innovation performance and structural embeddedness. However, structural embeddedness does not directly affect innovation performance nor mediate the link between relational capital and innovation. Notably, open innovation significantly moderates the relationship between structural embeddedness and innovation performance. This study contributes by integrating relational capital, structural embeddedness, and open innovation into a coherent framework within the underexplored context of Indonesian digital startups. The findings reveal that while relational capital is crucial, structural embeddedness alone is insufficient without active open innovation practices, offering nuanced insights for incubator management in emerging economies.