Handling metadata and module-based capabilities are enablers for radical new ways of interaction within and between small and medium-sized enterprises (SMEs) in terms of innovation. A challenge in this often complex actor and interaction picture is that there can be organizational, process-related, financial and practical barriers which tend to reduce innovativeness. There is thus a need for methods which can provide dynamic and company-based innovation networks. This study investigates the main barriers for effective interaction and sharing of innovation capabilities within SMEs. The factors identified are individual, technological and organizational factors. The success of SMEs lies in overcoming all these barriers in order to ensure effective interaction and sharing of innovation capabilities through their networks. This study suggests the main conditions and elements which can contribute to overcoming the barriers against effective interaction on innovative capabilities among SMEs.