Letter from the Editor-in-Chief: The how and the impacts of going international

Abstract

Journal of International Business Studies (2009) 40, 1239–1240. doi:10.1057/jibs.2009.53 This issue of JIBS consists of eight articles, seven of which were originally submitted under former Editor-in-Chief Arie Y. Lewin and then transferred to my editorial team, and a research note. Three topics are covered under the general research question of the how and the impacts of going international: international entrepreneurship, cross-border acquisitions and cultural/human resource management (HRM) implications of going international. Entrepreneurship has been defined as the identification and exploitation of previously unexploited opportunities. Often, additional funding is needed to bring new opportunities to market, so entrepreneurs turn to venture capitalists. Scholars tend to think of venture capitalists as local firms that provide financing for new businesses (e.g., through loans, angel investors and initial public offerings (IPOs)). However, ‘‘Understanding global flows of venture capital: Human networks as the ‘carrier wave’ of globalization,’’ by Madhavan and Iriyama argues that venture capital has now become a cross-border activity. The authors contend that industry drivers for globalization are both economic and network based. Economic pressures cause venture capital to be drawn to large economies and correlated with cross-border investment flows. Socio-cultural drivers are generated by transnational technical communities that form a ‘‘community of practice,’’ creating intensive, trust-laded interactions that facilitate cross-border venture capital flows. Examining US outbound venture capital flows for 1982–2002, the authors find support for both the economic and network arguments. One of the major activities of venture capitalists is helping entrepreneurs launch an IPO. An IPO can be a springboard for rapid internationalization of sales by the newly listed firm. ‘‘R&D, internationalization and growth of newly listed firms: European evidence’’ by Filatotchev and Piesse investigates the growth of foreign sales by newly listed firms in the UK, Germany, Italy and France during 1985–2004. The authors find that R&D intensity is positively correlated with internationalization of newly listed firms. Both R&D and export intensities are positively related to overall sales growth. The next three articles examine cross-border acquisitions. Chari and Chang in ‘‘Determinants of the share of equity sought in cross-border acquisitions’’ argue that foreign firms will seek a lower equity share if the acquisition involves adverse selection hazards in valuation, post-acquisition costs related to cultural distance, unbundling costs of selling non-desired assets and the real-options Journal of International Business Studies 40, 1239–1240 & 2009 Academy of International Business All rights reserved 0047-2506