Industry associations are a known mechanism for collective action. Recent research has also identified their role in innovation and industry emergence. We identify a role for industry associations in facilitating business model innovation across an industry. This function is distinct from their external-facing activities described in the extant literature. Their role in business model innovation represents an important cooperative strategy with potentially wide application given a broad set of boundary conditions: a lack of scale economies and the presence of variety externalities. An historical study of the venture capital industry illustrates how an industry association facilitated horizontal coordination and learning to promote the discovery of a new business model in an economically significant setting.
