Cross-border network ties of returnee entrepreneurs and foreign market diversity

Abstract

PurposeThis study examines the effect of cross-border network ties of returnee entrepreneurs on the foreign market diversity of their ventures. The study further investigates how two cross-cultural competencies (global mindset and cultural intelligence) moderate this effect.Design/methodology/approachA sample of 135 returnee entrepreneurial ventures from China was used to test the hypotheses.FindingsThis study finds that returnee entrepreneurs tend to enter into a wide range of culturally different country groups when returnee entrepreneurs have strong cross-border network ties. Moreover, global mindset and cultural intelligence function as complements in strengthening the effect of the cross-border network ties on foreign market diversity.Originality/valueThe authors contribute to both returnee entrepreneurship and foreign market entry literature in two ways. First, by examining the effect of cross-border network ties on foreign market entry, the authors add new and important insights into the role of social networks in the pre-internationalization phase. This is useful in understanding the internationalization process of new ventures founded by returnees, which have not been fully understood in returnee entrepreneurship literature. Second, by examining the moderating roles of global mindset and cultural intelligence, the authors enhance the understanding of the extent to which cross-border networks can be valuable in foreign market entry.